For many years, Switzerland has been categorized as a place where you could go admire the beauty of the Alps, eat some delicious cheese and chocolate and do your banking. But now, Switzerland has emerged as one of the important technology hubs in Europe and even in the world. The Global Innovation Index has ranked Switzerland as the most innovative country in the world in 2017, which shouldn’t come as a surprise for those who already know that more and more startups are choosing Switzerland as the place to start a new business.
Access to excellent talent
Since funding is so important for a startup it considerably helps to already have a strong basis in regard to other business aspects, such as having highly skilled employees. To develop all kinds of innovative products and services, it is necessary to have talented people, which can be a challenge for other business hubs, but not for Switzerland.
The level of secondary and university level education in Switzerland is ranked among the highest in the world, due to its prestigious universities and schools that attract talented students from all over the world. In addition, most universities organize fairs and events that are meant to bring together companies and students, so that startups can recruit their employees even before they complete their education. For example, the Swiss Federal Institute of Technology in Zurich has become a real launching pad for startups, either by collaborating with them in various research projects or by helping them find the talent they need within the university. Over the recent tears, approximately 2,500 jobs were created with the help of the strong connections between ETH and startup companies.
Considering Switzerland’s high standard of living and high wages paid in most industry sectors, the majority of those who graduate a secondary school or a university are willing to find a job at home, without having to move to another country. While it can be difficult to compete with multinationals and large corporations that also have a strong presence in Switzerland, startup companies can attract talented employees by offering them more challenging and interesting roles. Rather than starting from the bottom of the hierarchy, talented students will surely contemplate occupying a more desirable position in a startup company than a standard job with few perspectives in a multinational.
Startups that are looking into expanding their activities on foreign markets as well have no problem in finding workers that have excellent language skills in English, along with at least one of two to other languages. This can be an important advantage because it’s easier to find the right person to fill out the right position when the business is expanding.
Extensive business network
One of the main advantages of Switzerland as a startup hub is the fact that the government and local authorities are very open to create a favorable business environment for all types of companies and for foreign entrepreneurs. For example, the Swiss public administration, tax authorities and social insurance institutions are constantly trying to simply as much as possible the incorporation process.
Although multinationals and Swiss corporations are strong players on the market, the majority of companies registered in Switzerland are SMEs. As a matter of fact, corporations are not direct competitors for startups, because they actively seek to create business partnerships.
Leading organizations, including some of the biggest companies in the world, are increasingly interested in building connections with the Swiss local startup scene. They know that this is where they can find valuable talent, innovative products and extensive research. All these corporations are organizing their own innovation labs and are constantly on the lookout for interesting startups which they can fund, partner with or even acquire at some point.
Funding is still difficult, because it is never easy to find investors for startup projects that may or may not offer consistent profits, but there are several support programs and entrepreneurial communities that promote networking events, exchanging information and sharing their experiences.
Access to a strong local market
Switzerland may not be a large country, but the local market is very diverse, perfect to test and research all kinds of new products. Swiss consumers also have high buying power, due to the high wages. According to sales figures, the Swiss tend to remain loyal to local businesses, so they most often choose Swiss made goods and services rather than popular global products. For example, the leading online store in 2016 and the most popular online retailer in 2016 were both Swiss.
This not only creates an attractive local market, with high buying power, but it also provides a good opportunity for startups who want to recreate and adapt existing products to the Swiss market. Zurich, Geneva, Basel or the canton of Vaud have already emerged as important business hubs, while for new fintech businesses, Zug is considered an important Swiss hub.
For further information regarding launching a startup company in Switzerland, don’t hesitate to request the support of our Swiss company formation specialists.