Business Start-ups struggling to overcome EU bureaucracy, survey finds

Business Start-ups struggling to overcome EU bureaucracy, survey finds

A survey of some of Europe’s most successful digital start-ups and scale-ups has found new online businesses are already struggling to overcome layers of EU bureaucracy.

The survey of members of Digital Future for Europe - a coalition of more than 100 start-ups, scale-ups and tech associations, including Solita and Connecterra - revealed that more than half of respondents, 53% struggle with new regulation. Meanwhile a third also complained of encountering barriers to doing business across the EU’s new digital single market.

As the European Commission debates new regulations that could stifle innovation and prevent European start-ups from getting off the ground, a huge proportion of respondents, 90%, expressed their fears that badly designed regulation would make it harder for them to do business.

Kadri Tammai, Co-Founder and board member of Estonian startup Tehnopol Ventures said: “As the European Commission and decision-makers in Brussels look to introduce new rules and regulations governing the tech ecosystem it is crucial that the voice and concerns of Europe’s start-ups and scale-ups are heard.

“Clearly, now is the time to foster a more open environment to allow innovators and entrepreneurs to thrive instead of burdening them with more red tape and new regulations. Europe will continue to lag behind on the world stage if it doesn’t create the right conditions for new tech businesses to grow.”

Digital Future for Europe is a group of associations, think tanks, start-ups and scale-ups, from across the “digital frontrunner” nations that have come together to embed a positive, ambitious and innovative digital agenda for Europe.

The Coalition is broadly made up of SMBs of fewer than 50 employees and while members are based in Europe, almost half serve a global market (51%). The Covid-19 crisis meant that some of the businesses surveyed experienced difficulties during the pandemic, but they are bouncing back with 87% expecting to make new hires this year, 62% planning to launch new products and services, and 64% to planning to expand into new markets.

Despite voicing concerns, half of the respondents also felt that the EU was positive about the tech sector and 60% believed that the EU is an attractive destination for investment.