Which European countries are most conducive to the creation of companies in the field of AI?
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The global generative AI market is expected to grow by 30-40% each year. Competition is intense to attract new businesses. Although the United States is undoubtedly winning the battle currently, some European countries are also considered hot spots for the creation of new AI companies.
Global AI market expected to accelerate
Generative AI technology, which generates new text or videos and helps accelerate product development, is a booming market. Globally, it was valued at more than €130 billion in 2023.
The latest AI report from Stanford University indicates that most private investment (62.5 billion euros) took place in the United States in 2023, followed by China (7.3 billion euros). euros). The EU and the UK together received 9 billion euros in investments.
Last year, the number of newly founded AI companies increased by more than 40% globally.
The best places to create an AI company: Europe
New ranking finds the U.S. as the best country to start an AI company, with the most newly funded AI companies, according to a report from AI Quick Start Tool AI AIPRM.
Of the 14 countries analyzed, six are European. The report ranks the best countries for building an AI startup based on factors such as number of newly funded AI companies, total private investment, research and development (R&D), startup financing and revenue growth. (The data used for this study comes in particular from the Stanford report on AI and the Deloitte study on the subject).
Singapore takes second place and Sweden third, with exceptional revenue growth of 1,127%.
The business environment has boosted Switzerland’s scores, which takes fourth place in the world. Germany also performed well, but the business environment and funding for startups seems less favorable there than in Switzerland, placing Europe’s strongest economy in sixth place.
Spain is highly rated for its business environment and startup funding and ranks higher than Germany and France.
The latter scores 68.58/100 and is ranked 9th best place in the world to start an AI company. France has a total private investment in AI of €9.42 billion and is home to the highest number of newly funded AI companies in the EU. However, hiring in the field of AI in France decreased slightly in 2023 compared to the previous year.
“Getting started in AI is becoming increasingly competitive as the industry continues to expand and grow at a rapid pace”said Christoph C. Cemper, founder of AIPRM.
What Europe can gain
Generative AI could add €521 billion to the European economy, according to global management consulting firm McKinsey & Company. This is equivalent to around a tenth of Germany’s GDP.
To better assess Europe’s competitiveness in this emerging market, European organizations need to adopt AI technologies more widely.
In the creative market, Europe leads in only one of the eight segments, that of AI semiconductor equipment. According to the McKinsey report, the continent has less than 5% market share in raw materials, AI semiconductor design, AI semiconductor manufacturing and AI infrastructure. cloud and supercomputers.
To support investments, the European Commission launched an AI innovation aid package in January 2024 to support startups and SMEs in the artificial intelligence sector.
ADVERTISEMENTThe report suggests further increasing investments, for example in AI applications for the health and defense sectors, and supporting programs that target workforce reskilling and retention. talents.
Another key element is achieving competitive energy prices in Europe. AI is expected to accelerate data center electricity demand, which could reach up to 5% of total electricity consumption by the end of the decade.
In Europe, labor productivity has slowed; The McKinsey study estimates that generative AI could boost Europe’s annual productivity growth rate by up to 3% by 2030.
