A new survey reveals that European entrepreneurs are losing faith in Europe. The pan-European legal form of EU Inc. could help change this perception. Financial services provider Stripe proposes three factors by which the success of such a venture should be measured.
The financial services provider Stripe published a new survey on how European founders assess the framework conditions for start-ups in Europe and how policymakers can strengthen Europe’s competitiveness.
Two hundred founders and executives from the 27 EU member states were surveyed. Respondents cited the level of education (66 percent), proximity to key markets (61 percent), and the availability of skilled workers (44 percent) as the three biggest advantages of the EU as a business location.
Despite these strengths, significant hurdles remain: Only 21 percent of respondents are confident that Europe will become a world-leading technology hub within the next five years. 36 percent have considered establishing their business outside the EU, primarily due to the regulatory environment. In a comparable survey in 2022, this figure was only 33 percent.
Fragmentation and increasing compliance requirements remain ongoing challenges.
73 percent of respondents report that their company is spending more time on regulation and compliance. 81 percent believe that policy measures are geared more towards established companies; only 14 percent say they meet the needs of startups in their early stages of development.
Greater harmonization of rules within the EU, including the introduction of a cross-border legal form for startups, remains one of the most important demands. 52 percent of respondents believe that harmonized rules would help them sell in more markets.
Such a pan-European legal form, also known as EU Inc., is currently in the final stages of negotiation. The reform aims to enable faster, more cost-effective, and fully digital processes, thereby reducing the friction caused by differing national legal systems in Europe. This would benefit the competitiveness of the European economy.
Stripe argues that the success of EU Inc. should not be measured solely by the introduction of the legal framework. Crucially, it depends on whether companies actually choose this legal structure and perceive it as an improvement. Stripe therefore proposes key performance indicators (KPIs) to assess its use and suitability for startups: How many EU Inc. companies were founded one year after the introduction of the legal form? And do founders actually spend less time on compliance as a result?
“European founders want clear, harmonized rules that will allow them to grow faster,” says Eileen O’Mara, Vice Chair at Stripe. “EU Inc. offers the opportunity to make Europe a more relevant global startup location. Let’s make sure this opportunity is seized.”
The full guide is available here .
