EU4Digital Facility has published a study report that maps and diagnoses the start-up ecosystem in the Eastern Partnership (EaP). Produced by the EU4Digital ICT Innovation stream, the report defines the concept of high-performing incubation, presents analysis of the current situation and provides recommendations for the development of associated support programmes in the partner countries – Armenia, Azerbaijan, Georgia, Republic of Moldova and Ukraine. The report is available online.
The study of the EaP start-up ecosystem was prepared by a central team of experts. They developed the mapping, conclusions and recommendations by holding multiple consultation rounds with country-level stakeholders, such as organisations performing ecosystem building and incubation activities. During the report preparation, a wider community of national stakeholders – more than 100 local and international market stakeholders such as government organisations, investors, large corporations, academia, international donors, and others – was engaged in sessions to raise awareness about the importance of developing the region’s start-up ecosystem.
High-performance innovation and start-up ecosystems drive the growth and development of innovative businesses throughout their lifecycle stages. The start-up ecosystem in Eastern partner countries has been developing in recent years, but is still in early stages compared with more mature ecosystems in other countries, the study found.
54%
increase in growth rate in number of new start-ups thriving within EaP incubators between 2021-2023
70%
lower conversion rate of EaP start-ups compared to those in Central and Eastern Europe
8.6%
of incubated EaP start-ups reached seed stage and generated sustainable revenue (compared to 12.5% in selected Central and Eastern European countries)
To boost the performance and growth of the innovation and start-up incubation ecosystem in the Eastern Partnership (EaP) region, the EU4Digital report includes eight recommendations supported with proposed action points. These recommendations address:
regulators and donors – focusing on empowering ecosystem builders through capacity building, collaboration with donor organisations and government bodies, and increased support for wealth enablers;
ecosystem builders – focusing on empowering incubators to improve their impact on the creation of high-growth-capacity start-ups by delivering knowledge, capital, market and resources to entrepreneurs.
Aiming for impact
For maximum impact, the report’s recommendations should be consolidated into a comprehensive regional programme with a focus on enhancing incubation efforts. Since the Eastern partner countries share similar gaps and requirements, a coordinated effort would ensure a more efficient distribution of resources and facilitate the exchange of best practices. Such a programme could be supported by both public and private sector stakeholders, who could work together to create and support a vibrant regional start-up ecosystem.
EU4Digital Facility will continue to support such activities in line with its commitment to the European Union’s aim to connect EaP and EU innovation and start-up ecosystems and close any gaps, drawing on EU best practices, principles and standards. The study was conducted in line with the long-term policy objectives for the Eastern Partnership beyond 2020, in which the European Commission highlighted its plan to support the scaling up of highly innovative digital start-ups and scale-ups in the region.
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