• New index reveals London has more of what matters to digital businesses
• Tool helps startups, scale-ups and policymakers identify city benefits and challenges

London is the best city in Europe for digital entrepreneurs, according to a new index that measures what startups and scale-ups1 say is important to them.

The European Digital City Index, is launched by Nesta as part of its work on the European Digital Forum, a project with the Lisbon Council to promote the digital economy.

The Index measures and ranks the EU’s capital cities and known digital innovation hubs2 against ten criteria set by digital businesses3, and supported by policymakers and academics. The criteria relate to a city’s ecosystem and include digital infrastructure, culture, and skills availability.

Available to search at www.digitalcityindex.eu the Index is intended to help entrepreneurs identify the strengths and weaknesses of a particular city and help policymakers understand where they need to devote more resources to make a city more attractive to digital businesses. Entrepreneurs can also personalise their search by applying more or less weight to each criteria.

Top Ten Cities for Digital Entrepreneurs:

Ranking

Startups

Scale-ups

1

London

London

2

Amsterdam

Stockholm

3

Stockholm

Amsterdam

4

Helsinki

Helsinki

5

Copenhagen

Copenhagen

6

Paris

Paris

7

Berlin

Brussels

8

Dublin

Dublin

9

Brussels

Berlin

10

Munich

Munich

The European Digital City Index reveals that London scores highest overall for startups and scale-ups and specifically for access to capital, entrepreneurial culture and knowledge spillovers. Across all ten criteria its lowest score is for lifestyle which assesses standard and cost of living. Other UK cities that feature on the list include Cambridge and Oxford which appear 11th and 13th respectively for startups and scale-ups.

Berlin, which has produced a number of billion dollar startups, including online fashion shop Zalando and restaurant delivery service Delivery Hero, is only ranked 7th for these businesses. This is because of its expensive and relatively sluggish digital infrastructure and high cost associated with employing staff. Brussels scores higher for scale-ups because of its greater access to capital.

The European Digital City Index follows a guidebook from CITIE that assessed the policy environment of 40 leading global cities. It identified New York City as having the most effective policy environment to foster innovation with London in second place.4

Chris Haley, Head of Startups and New Technology Research at Nesta, comments: "Entrepreneurship, particularly digital entrepreneurship, is vitally important for innovation and growth but not all cities provide equally fertile ground for these businesses. Our research indicates that location does matter, and illustrates the ways in which top cities create a supportive environment and where lessons can be learnt."

The European Digital City Index launches at the European Commission’s ICT 2015 Innovate, Connect, Transform Conference in Lisbon at on Wednesday October 21st.

The Index will be updated in 2016 and expanded to include more EU cities.

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Footnotes:

1. Scale-ups are defined in the European Digital City Index as rapidly growing businesses with at least ten employees.
2. Non-capital cities included in the European Digital City Index are Barcelona, Cambridge, Cologne, Milan, Munich, Oxford, Stuttgart.
3. More than 90 digital entrepreneurs, policy researchers and academics helped determine what the European Digital City Index criteria should be.
4. CITIE, a project which assessed the policy environment of 40 leading global cities, was led by Nesta in partnership with Accenture, and the Future Cities Catapult.