Switzerland: A Start-Up Nation? - Experis Switzerland

Switzerland: A Start-Up Nation?

by Nina Schröter

Amongst London, Berlin, Paris and Copenhagen, Zurich is host to one of Europe’s most dynamic start-up ecosystems. Today, an average of 300 start-ups are founded each year and are encouraged by Switzerland-wide university initiatives including the EFPL Innovation Park and the ETH’s launch of Digital Zurich 2025. Advancements in Information Technology stand at the forefront of such programmes. Whilst the Reg-Tech, Insure-Tech and Fin-Tech scene is steadily growing, cutting-edge Artificial Intelligence technologies are revolutionising business processes across all sectors. Whether in Financial Services, Life Sciences, Telecommunications or Engineering; technological innovations are sought after to increase both productivity and efficiency.

In Switzerland, old-ancient political stability and consistent economic growth — barring the Dot-Com Bubble Burst and the collapse of Lehman Brothers in the early 2000s — have certainly fuelled this entrepreneurial spirit. Favourable corporate tax legislation and comparatively low starting capital requirements are likewise attributable. Moreover, Swiss business culture has long endorsed the merits of research and innovative thinking. Today, SME’s make up more than 99 per cent of all Swiss companies, employing two-thirds of the workforce (approximately three million employees), as Axa confirms.

An Uncertain Future

Concurrently, data suggests that only half of Swiss start-ups survive for longer than five years. In comparison with other Western nations (particularly the United States), company growth is slow and fraught with risk. Whilst only 6% of Swiss start-ups are eventually registered to a stock exchange listing (as cited by the Swiss Start Up Radar 2018/2019), most rely on continuous investor funding and struggle to meet client needs due to inadequate market knowledge and impractical expectations. Lacking transparency, team-spirit and business forecasting often also cause company structures to crumble from the inside-out. 

The Long-Term Outlook

As Millennials continue to shake up the workforce and the Baby Boomer generation is nearing retirement, we may nonetheless witness a flourishing of start-up culture and practices both in Switzerland and abroad. The goal must be to strengthen the growth, competitiveness and prosperity of newly launched companies, as the Swiss Entrepreneurs Foundation has set out to achieve since December 2017. UBS, Julius Baer and Credit Suisse are already supporting such initiatives through venture capital and private equity investments. In the long-term, collaborations between corporations and start-ups should play an even more active and mutually reinforcing role.