DLD Conference 2023: Is Europe still competitive?January 18, 2023 | By Peter Bakenecker
Europe was once the undisputed leader when it came to innovation: The continent's researchers and innovators contributed significantly to groundbreaking inventions such as the combustion engine, the radio and the World Wide Web. Over previous decades, investments in R&D across European countries were second to none – anywhere in the world.
But for some years now, European companies seem to be falling behind, in particular in the development of new technologies and digital innovations.
Last week, I had the pleasure to participate in Hubert Burda Media's DLD conference and discuss the cornerstones for a successful Europe.
Peter Bakenecker at DLD Munich 2023.
Europe has great potential for innovation
My co-panellists and I all agreed that there is no shortage of innovative ideas and companies in Europe. However, there are many obstacles to the implementation of these ideas, not least an ecosystem that does not always incentivise innovation.
Mastercard has a strong presence in Europe and a long history as a platform that helps European businesses of all sizes take advantage of digital technologies. Over the past 50 years, we have been a reliable partner to European companies at every step of the digital transformation.
Mastercard bundles know-how in European tech hubs
Over the years, Mastercard has invested a lot in Europe to drive new technologies and innovations, in particular in areas such as e-commerce, artificial intelligence, the Internet of Things, blockchain and cyber security. Last year, Mastercard opened a new tech hub in Dublin with a capacity of 2,000 experts, adding to the work already done at our other European hubs on sustainability, cybersecurity and tourism.
At these hubs, we work with leading companies and research institutions. We bring together the leading minds of Europe and beyond to harness advanced technologies and deliver innovative business solutions. Together with customers and partners, we work on new concepts and products - from customer journey mapping to UX design, rapid prototyping and technical planning. We support both established players and start-ups in the development, marketing and scaling of new products and solutions.
As I see it, the concept of money is being redefined right now. In the future, we will increasingly pay with non-traditional assets such as data, cryptocurrencies or digital goods in our everyday lives.
Startups are driving digital transformation
In particular in the financial sector, the rapid digital transformation is primarily driven by startups. According to some estimates, the European technology industry is worth around 2.5 trillion Euros. This makes Europe one of the fastest growing regions for private capital investments. European startups accounted for about one third of global financing rounds of up to $5 million (compared to 35 percent for the US). This shows the confidence investors have in European startups.
However, the current economic and geopolitical upheavals are having a lasting impact on investment behaviour. After years of massive growth, last year, the overall value of the European ecosystem declined for the first time since 2010.
Mastercard supports startups with know-how and scalable technologies
Mastercard has long supported innovative late-stage startups, helping them to successfully shape digital transformation on a global scale. With the Start Path program, Mastercard leverages its partnerships around the world and provides participating tech startups with its expertise and technologies that enable efficient access to the ecosystem, rapid market entry and global expansion. This enables tech startups to scale faster.
More than 250 startups have participated in the program since 2014, including many European success stories such as N26, Railsr or Revolut. The program also helps banks and retailers to accelerate the development of commercial products and solutions by collaborating with startups.
Reason for optimism
I am very optimistic and I believe that innovation will continue to come from Europe. We will continue to play an active role and be a partner to all the great innovators, to make Europe the best region it can be. At the same time, the speed of digital transformation will also depend on Europe’s ability to establish and maintain an innovation-friendly ecosystem with the appropriate legal framework.
See the full discussion also here.