The Spanish innovation ecosystem
The Spanish entrepreneurial ecosystem has grown and matured in 2021, with the fintech sector leading the way and a considerable boost from investors. While Madrid and Barcelona continue to dominate the national landscape, regions like the Canary Islands are working hard to make a name for themselves, showing the wealth of opportunities for innovation and the diversity of sectors in the Spanish archipelago.
Almost $3 billion of venture capital invested in startups in the first eight months of 2021, more than triple the amount for 2020. Some 10,500 emerging tech companies, 300 of which are scaleups with a proven track record. Four unicorns, technology companies valued at over $1 billion (€887 million) without going public. These figures, provided by Atomico, Dealroom and CB Insights, reveal that the Spanish entrepreneurial ecosystem is in very good shape.
‘The data are incredible compared to 2020 and it’s not something that’s unique to Spain – the positioning of European startups has improved’, says María Benjumea, President of Spain Startup, the platform responsible for organising the South Summit. This year, financing for startups on the Old Continent has reached the $100 billion milestone (€88.7 billon), with Spain in sixth place in the ranking.
Following the hurdles of the pandemic, innovation in Spain has not only picked up again in 2021, but has really hit the floor running. Before the year comes to a close, we take a tour through entrepreneurial Spain, stopping off at the local hubs and taking snapshots of financial innovation along the way.
A consolidated ecosystem with a fintech focus
The average age of Spanish startups is 2.7 years, a figure higher than that of previous periods according to a Map of Entrepreneurship by the South Summit, an event that BBVA partners with on a global level.
The report also indicates that the fintech sector is leading the way – the country is home to more than 650 fintech startups, of which 133 have foreign roots, according to the Finnovating platform. Of these, those dedicated to lending, payments and financial infrastructure are dominant. “The fintech sector has matured – we’re becoming an international hub”, confirms Rodrigo García de la Cruz, CEO of Finnovating and President of the Spanish Association of Fintech and Insurtech (AEFI).
A tour around Spain
Spanish startups are not evenly distributed around the country – Madrid and Barcelona are the major hubs and account for 75% of fintechs, according to EY.
Nevertheless, Atomico points out that it is one of the European countries where investment is most well distributed among cities. ‘One feature of Spain is its capillarity’ agrees Benjumea. Throughout the year, BBVA Open Innovation has profiled some of the most innovative regions, where it also has a presence and is involved in collaborations.
Regarding the Canary Islands, they combine ingredients to gain visibility, such as a tech and startup ecosystem currently immersed in a wave of innovation, driven by advantages such as technological infrastructures, local talent, tax incentives unique in Europe, and outstanding quality of life, a magnet destination for digital nomads.
The Canary Islands is the fastest growing region of Spain in attracting technological talent, and offers incredible opportunities to innovate in marine maritime and renewable energy industries. There is also room for fintechs, as proven by eSignus, which focuses on blockchain.
It is quite likely that the arrival of the European funds ’Next Generation EU’, the Startups Law and the financial sandbox (a controlled testing environment) will keep fueling the fire of Spanish entrepreneurship on the road to innovation.