Research carried out by Stripe shows that European entrepreneurs are losing confidence when it comes to setting up a business in the bloc.
The financial services company’s survey found that more than a third of business founders have have considered launching their business outside the EU because of the regulatory environment, up from 33% in 2022.
Stripe is backing the proposed EU Inc legislation to help startups, while its survey findings examine EU Competitiveness and Policy Recommendations.
The EU Inc. proposal is part of the EU “One Europe, One Market” roadmap.
The reform aims to simplify the legal framework for startups and scale ups across member states.
Stripe surveyed 200 founders, business leaders and policy leads at technology companies across all 27 EU member states.
It’s respondents pointed to Europe’s education (66%), proximity of markets (61%) and talent (44%) as key strengths of its tech ecosystem.
However, the findings also showed that persistent challenges remain in fragmentation and compliance demands.
Almost three quarters of those surveyed say the time their company spends on regulation and compliance is increasing.
Less than a third believe harmonised rules are presently a European advantage.
Only one fifth of respondents are confident Europe will become a global tech leader within the next five years.
While 81% believe policymaking is designed around established corporations, with only 14% saying it is designed for early-stage startups.
Vice Chair at Stripe Eileen O’Mara said European founders are asking for clear, harmonized rules that enable them to innovate at scale.
“EU Inc. is an opportunity for the EU to put Europe back on the global startup map. Let’s make sure we get it right.”
The financial services company is recommending that the reform is measured not only on uptake, but on whether it improves startups’ experience.
Stripe said there should be defining benchmarks on uptake and startup fit: How many companies are incorporated under EU Inc rules after a year, and whether a target percentage of adopters report spending less time on regulatory compliance.
