Switzerland is the most innovative country in Europe for the 13th consecutive year.

Nestled amidst the snow-capped peaks of the Alps, Switzerland is an unlikely setting for a bustling startup ecosystem. Yet, this nation is quietly emerging as a global powerhouse for innovation and entrepreneurship.

With a strong financial market, a supportive government, and an innovative culture that lives in its bones, Switzerland has it all.

Switzerland’s strong pillars

Switzerland emerges as a prime destination for startups, thanks to its unique combination of global reach, economic stability, and innovative talent. Positioned at the center of Europe, it offers startups vast international exposure, access to diverse markets, and skilled multilingual talent.

Source: Swiss Tech Startup Ecosystem — NOAH21

Let’s quickly tour the country and discover what makes it shine!

International reach and exposure.

Switzerland's central location in Europe and multilingualism provide startups with easy access to international markets, networks, and talent. This global perspective allows Swiss startups to tap into broader opportunities and expand their reach.

A stable economic landscape.

Switzerland's political stability, strong economic performance, and low unemployment rate create an environment that encourages entrepreneurship and investment. The country's high GDP per capita further enhances its attractiveness for startups seeking a strong foothold in the global market.

Strong local innovative talent.

Switzerland's education system consistently produces high-quality graduates with a strong technical expertise and innovation focus. Local universities and research institutions are hubs of cutting-edge research, providing steady talent for the startup community.

The startup funding landscape in Switzerland

Until January 2023, Switzerland witnessed $2.2B raised in 213 equity funding rounds. In comparison, in January 2022, the country had raised $5.2B across 313 rounds. It indicates a significant decrease of 57.52% in funding for Swiss companies in 2023 compared to the same period in 2022.

Switzerland is in the top 5 European countries by venture capital raised in 2023, with $2.3B raised, representing 36% growth compared to 2019.

Source: Europe Tech Q3 2023 by Dealroom

The country has a strong background in ICT, Fintech, and Biotech sectors. In 2022, Switzerland saw a significant increase in these sectors, with investments exceeding CHF 2 billion for the first time.

The ICT sector experienced a notable 70% increase in funding, crossing CHF 1 billion, while fintech companies also upped their financing, with famous companies like Wefox and SonarSource reaching high valuations.

Starting a startup in Switzerland is increasingly appealing for entrepreneurs due to various factors. Swiss startups are attracting large global companies, offering collaboration or acquisition opportunities.

Source: Venture Capital 2023 Swiss Report by startupticker.ch.

Additionally, international investors are showing more interest in this region due to more attractive valuations compared to overseas, predictable financing market development, favorable general conditions, and legal certainty.

Source: Venture Capital 2023 Swiss Report by startupticker.ch.

However, the number of funding rounds slightly dropped in ICT by 8.8% and increased in fintech by 17.4%. The average funding amount in ICT increased, while it decreased in fintech. Together, these sectors represented over half of the total investment amount and the number of funding rounds in 2022, showing steady growth in other areas, too.

Source: Venture Capital 2023 Swiss Report by startupticker.ch.

Foundation FIT is one of the most active local venture capitalists that backed three European seed unicorns.

Source: Funding Venture Report — Dealroom

Switzerland’s venture ecosystem is roughly four times larger than that one of Austria, and Swiss startups dominate the rankings. 2023 has been a bit slow in the venture capital scene in Switzerland and Austria, with only two new funds launching.

This is quite a drop from the 15 funds in 2022 and 11 in 2021. Despite the tech industry's tough times, Switzerland and Austria are surprisingly seeing a boom in startup exits, especially in the first quarter of 2023. It's looking like a record-breaking first half of the year.

Source: Ranking: the Swiss and Austrian startups to watch in 2023

Major startup communities in Switzerland

Switzerland's startup ecosystem is thriving, with 18 cities among the 100 best cities for startups. The Swiss startup ecosystem is ranked eleventh globally and has grown nearly 15 times in the past decade.

Some of the major startup cities in Switzerland include:

Zurich.

Zurich has established itself as a hub for innovation and is home to many startups. A strong focus on technology and entrepreneurship characterizes the city's startup scene.

The city is home to 1,794 startups, 2,010 rounds raised, and is ranked as the highest startup ecosystem in the country. Zurich's startup scene has experienced significant development, leading to its ranking as the 12th-best startup ecosystem in Western Europe.

Source: Swiss Tech Startup Ecosystem — NOAH21

The city benefits from strong local educational institutions like ETH Zurich, which has played a key role in the research and technology transfer, resulting in numerous spin-offs in various industries, including robotics, biotechnology, and fintech.

Switzerland and Lausanne have been accelerating fast in recent years, attracting significant investments from big tech and venture capital firms. Switzerland's attractiveness as a place to live, coupled with its supportive authorities and growing track record of producing unicorn businesses, has further enhanced its appeal to startups and investors.

Lausanne.

Lausanne, located in the French-speaking part of Switzerland, is known for its dynamic startup ecosystem, supported by the presence of EPFL (École Polytechnique Fédérale de Lausanne), a leading technical university.

The city is home to 185 startups, representing about 13% of Switzerland's startups, and is ranked as the second-best startup ecosystem in the country.

Geneva.

For centuries, Geneva has been synonymous with finance, hosting multinational institutions like the International Monetary Fund (IMF) and the World Trade Organization (WTO). While the city's financial prowess remains a cornerstone of its economy, a shift has been underway, with a growing emphasis on innovation and entrepreneurship.

“The innovation ecosystem surrounding Lausanne is humming.”

Says Julien Guex, Managing Director at FIT - Fondation pour l’innovation technologique.

Geneva, the cosmopolitan hub between France and Switzerland, has transformed remarkably from a traditional financial center to a startup haven. The city's strategic location and international outlook make it an attractive destination for entrepreneurs.

Geneva now has 120 startups, representing about 8% of Switzerland's startups, and is ranked as the third-best startup ecosystem in the country.

Swiss venture capital funds

• Versant Ventures — Versant Ventures is a healthcare investment fund financing biotechnology companies discovering and developing therapeutics.
• Lakestar Ventures — Lakestar provides seed to growth capital for European tech companies.
• Redapline Venture Partners — Redalpine is a sector-agnostic venture capital firm backing European founders.
• Swisscom Ventures — Swisscom Ventures is a Swiss corporate venture capital firm investing in global tech companies in the early and growth stages.
• Endeavour Vision — The fund provides growth equity for life sciences and healthcare technology companies.
• Alpana Ventures — Alpana Ventures seeks investment opportunities in deep tech solutions across Switzerland, Europe, and the US.
• Evolution Equity Partners — Evolution Equity Partners is a global VC firm specializing in information security, B2B SaaS, and consumer companies across the US and Europe.
• CV VC — CV Labs is a blockchain-focused venture capital founded in 2016.
• BackBone VC — ​BackBone is a pre-seed and seed VC firm funding ICT and food tech companies across Germany, Austria, Switzerland, and Israel.

These are just a few of the most local active venture capital funds.

Unicorns and future unicorns of Switzerland

Over the past decade, Switzerland's startup scene has experienced rapid development, significantly influenced by technological advancements and better integration between business and academia. In the last ten years, the country has produced 23 unicorns, over half of which are HealthTech startups.

Source: Swiss Tech Startup Ecosystem — NOAH21

In addition to the existing unicorns, Switzerland is also home to many startups with the potential to become unicorns soon. A Dealroom.co's report states that Switzerland has over 30 potential future unicorns, making it one of Europe's largest pools of possible future successes.

Want to learn more?

If you want to learn more about fundraising rounds, best practices, industry trends, and a snapshot of the venture capital market right now, prepare for your fundraising round; we’ve got you covered. Check out our Fundraising 101 resource for startups and subscribe to our newsletter below.