Development of Europe s technological ecosystem for large scale growth

In 2025 Europe demonstrates a surprising paradox: a region that accounts for less than 7% of the world’s population generates almost a quarter of global spending on R&D and holds leading positions in the Global Innovation Index. On the other hand, only 10% of European startups reach the scale-up stage, and the share of technology companies from Europe among the world’s “unicorns” still lags behind the US and Asia. Why is this happening? How can Europe’s technological ecosystem become a catalyst for large-scale business growth and competitiveness in the global market?

The adoption of innovations, the development of technology clusters and integration with digital platforms are becoming key success factors for European startups and corporations. But along with this, entrepreneurs face a range of challenges: complex regulation, barriers to scaling, AML and GDPR requirements, as well as strong competition for investment and talent.

In this article I share an expert perspective and practical recommendations based on the experience of the COREDO team in legal, financial and regulatory support of technology companies in the EU, Asia and the CIS. We will look at how to build an effective technology ecosystem for scale-up growth, which legal and investment aspects to consider, and which strategies actually work in today’s Europe.

The technological ecosystem of Europe – current state and drivers of development

The technological ecosystem of Europe is currently undergoing a phase of significant transformations, driven not only by the adoption of deep-tech solutions but also by comprehensive initiatives to support startups, talent and regional cooperation. The current state of the ecosystem and the key drivers of its development are creating new opportunities for market participants and setting directions for sustainable technological growth.

Main components of Europe’s technological ecosystem

European startups actively leverage the benefits of integration with venture funds and funds of funds (FoF), which allows them to attract financing not only at early stages, but also for scaling deep tech projects.

In recent years the COREDO team has implemented legal support projects for startups in clusters such as Berlin, Tallinn, London and Limassol. COREDO’s practice confirms: successful companies build business models at the intersection of technological innovation and flexible legal structures, which enables them to quickly adapt to market and regulator requirements.

Large corporations such as Airbus and Siemens invest in their own laboratories and startups, forming a stable environment for technological breakthroughs.

The role of the EU digital strategy and «Digital Europe 2025»

These initiatives aim to create a unified operating system EU OS, develop biometric border systems EES and implement a European data strategy.

The implementation of these programs creates unique opportunities for technology companies: EU state support for innovation is expressed not only in financing, but also in creating a favorable regulatory environment for large-scale business growth in Europe. Solutions developed at COREDO allow clients to effectively use state support tools and integrate into the European technological ecosystem.

The impact of the Global Innovation Index and Europe’s competitiveness

Europe consistently ranks high in the Global Innovation Index, ahead of most Asian and American competitors in terms of the development of innovation infrastructure, quality of education and investment volumes in technology. However, despite the high index, many companies face barriers to scaling and entering international markets.

This is precisely what distinguishes successful European startups and deep tech companies capable of attracting investment and executing large-scale projects.

State support for innovation in the EU

State support for innovation in the EU today is a key factor for the technological development of the region. Thanks to systemic government programs and large-scale funding, European startups and deep tech companies gain access to resources at the research, implementation and market entry stages. These mechanisms create conditions for the growth of global technology leaders and accelerate breakthrough innovations in the fields of artificial intelligence, medicine and sustainable development.

Government innovation support programs and their role in deep tech

State support for innovation in the EU is implemented through grants, tax incentives, acceleration programs and direct financing of R&D. Special attention is paid to deep tech projects in the areas of artificial intelligence, space, medicine and cybersecurity. The public sector becomes not only an investor, but also a major customer of technological solutions, which opens new opportunities for scaling.

The COREDO team supported clients in obtaining financing from European venture funds and government progra…, including Horizon Europe and the EIC Accelerator. Our experience shows: success in obtaining support depends on competent legal preparation and the compliance of project documentation with international standards.

EU technology regulation: challenges and opportunities

Technology regulation in the EU is characterized by a high degree of detail and constantly evolving requirements. This applies both to product certification and cross-border compliance. Certification and technology regulation issues in the EU are becoming one of the main barriers to scaling deep tech startups.

We recommend that technology companies integrate legal expertise at early stages of development to minimize costs and accelerate entry into new markets.

GDPR and AML for technology companies in Europe and Asia

GDPR and AML (Anti-Money Laundering) requirements significantly impact the business processes of technology companies. The implementation of GDPR has become a mandatory condition for all companies processing the personal data of EU citizens, which requires a review of IT infrastructure and legal procedures.

COREDO has implemented comprehensive projects to introduce AML policies and ensure GDPR compliance for technology companies in Europe and Asia. Our solutions include developing internal regulations, staff training, and integrating digital tools for transaction monitoring. This approach not only reduces legal risks but also increases trust from investors and clients.

Legal registration of companies in the EU and Asia for technology businesses

Company registration in the EU and Asia requires considering many nuances: from choosing the optimal jurisdiction to preparing constitutive documents and obtaining specialized licenses (crypto, fintech, payment, forex). In COREDO’s practice there have been cases where choosing the right jurisdiction (for example, Cyprus, Estonia or Singapore) significantly sped up business launch and reduced tax burden.

Special attention should be paid to KYC/AML issues, corporate law and disclosure requirements. For technology companies it is important to ensure transparency of ownership structure and compliance with international standards, which becomes critically important when attracting investments and entering foreign markets.

Investments and venture financing for business growth

Investments and venture financing for business growth are becoming a key tool for scaling companies and implementing innovations across industries. In a changing economic environment and with the emergence of new technological trends, approaches to venture financing are transforming, and the role of funds, including FoFs, acquires particular importance for sustainable business growth.

Venture financing trends in Europe and the role of FoF funds

Venture financing in Europe shows steady growth: in 2024 alone the volume of investments in deep tech projects exceeded €50 billion, and venture funds and FoFs are becoming key market players. The European model of venture financing emphasizes long-term partnerships and support for projects at all stages of development.

COREDO’s solutions enable technology companies to effectively structure deals with venture funds, taking into account the specifics of European corporate law and disclosure requirements. This approach increases the chances of successful capital raising and further scaling.

Institutional investors: insurance and pension funds in technology

Institutional investors, including insurance and pension funds, actively invest in technology companies, especially in the deep tech segment and digital platforms. Their participation provides not only financial stability but also access to strategic industry partners.

The COREDO team has supported projects on structuring investments from institutional investors, which requires special attention to compliance, risk management and protection of the interests of all parties to the deal.

Assessing ROI of digital technology implementation in business

Assessing ROI from implementing innovative technologies is a key indicator of the effectiveness of a company’s digital transformation. European companies use comprehensive metrics: cost savings, revenue growth, reduced time-to-market and increased customer satisfaction.

COREDO’s practice confirms: maximum ROI is achieved by integrating legal, financial and technological expertise at all stages of innovation implementation. This approach not only optimizes investments but also ensures sustainable business growth.

Barriers to startup scaling and exit strategies

Among the main barriers to scaling are complex regulation, talent shortages, market fragmentation and limited access to large investments. Exit strategies for European technology companies include IPOs, M&A deals and strategic alliances with international corporations.

COREDO’s experience shows that a successful market entry is possible only with a transparent corporate structure and compliance with all regulatory requirements.

Scaling technology companies and startups in Europe

Scaling technology companies and startups in Europe is associated with unique challenges and opportunities,

conditioned by the specifics of the local market, regulatory requirements, and investor expectations. To grow successfully in this region, businesses must consider not only market conditions but also the specifics of European regulation and infrastructure.

Scaling technology companies with regulatory considerations

Scaling technology companies in Europe requires a balance between innovation and compliance. Best practices include implementing flexible business models, integrating digital platforms, and building resilient partner networks.

The COREDO team has supported the scaling of startups in fintech, cybersecurity, and artificial intelligence, helping to build processes that account for cross-border regulation and AML/KYC requirements.

Cyprus and Southern Europe startup ecosystem in innovation

The startup ecosystem of Cyprus and Southern Europe is becoming an attraction point for technology companies thanks to a favorable tax regime, access to the European market, and active support from government programs.

COREDO’s projects implemented in Cyprus demonstrate that the right legal and financial structure enables leveraging the advantages of the European innovation ecosystem for rapid scaling and entry into new markets.

Innovative business models and digital transformation of the EU public sector

The digital transformation of the EU public sector opens new opportunities for technology companies: public tenders, contracts for the development of digital platforms, and the implementation of biometric and navigation systems. Innovative business models based on subscriptions, platform solutions, and SaaS are becoming the standard for European startups.

COREDO’s experience in supporting public sector projects confirms that integration with government programs requires special attention to legal details and compliance.

Risk management and compliance in Europe’s technology business

Best practices for risk management in the EU technology business include implementing internal control systems, regular audits, automating AML and GDPR processes, and staff training. COREDO’s solutions enable clients to minimize operational and legal risks, which is especially important when scaling and entering international markets.

Europe’s innovation ecosystem: development trends

Europe’s innovation ecosystem today is being shaped by long-term trends, where key drivers include deep tech, breakthrough space technologies, and new approaches to EU navigation. The development focus is on reassessing technological priorities, strengthening infrastructure, and active regulation that form the foundation for the next stage of growth of European high-tech industries.

Deep Tech, space technologies and EU navigation

Deep tech Europe is becoming a driver of development in strategic sectors: defense, space, and medicine. Space technologies and EU navigation systems, such as Galileo, open new markets for startups and corporations integrating AI and big data into their products.

COREDO has supported projects for the legal registration of companies in the EU for deep tech and space startups, which requires a deep understanding of international law and certification standards.

Secure communications and cybersecurity in Europe

Secure communications and cybersecurity are becoming priorities for European companies amid rising digital threats and tightening regulation. Implementing ISO standards, NIS2, and integration with EES biometric systems are mandatory elements of a strategy for technology businesses.

COREDO’s practice shows that timely implementation of cybersecurity increases trust from clients and investors and also facilitates certification processes.

Artificial intelligence and ecosystems in the digital future

artificial intelligence and open ecosystems are becoming the foundation of Europe’s digital transformation. The European data strategy and the development of platform solutions stimulate the creation of new business models and accelerate the adoption of innovations.

The COREDO team has implemented projects supporting the deployment of AI in the financial and medical sectors, which requires particular attention to ethics, data protection, and licensing issues.

International cooperation in defense and medicine

International technological cooperation is becoming a key factor for growth and scaling. Strategic sectors—defense, space, and medicine—require integration with global supply chains, compliance with export control standards, and cross-border compliance.

COREDO supports deals and partnerships involving European and Asian companies, ensuring legal clarity and protecting clients’ interests amid complex international regulation.

Recommendations for entrepreneurs and executives

Recommendations for entrepreneurs and executives will help look at business growth from the perspective of creating an effective technology ecosystem. In today’s conditions, only a properly built ecosystem can ensure sustainable development and a long-term competitive advantage for a company.

How to build a technology ecosystem for business growth?

• Choose jurisdictions with a developed innovation ecosystem and transparent regulation.
• Integrate legal, financial, and technological expertise at all stages of development.
• Use government support programs and venture financing instruments to accelerate growth.
• Implement digital platforms and risk management systems to increase efficiency.

Legal aspects of registering technology companies in the EU and Asia

• Prepare founding documents taking into account KYC/AML requirements and corporate law.
• Obtain necessary licenses (fintech, crypto, payments) at early stages.
• Ensure transparency of ownership structure and compliance with international disclosure standards.
• Use COREDO’s expertise to optimize registration and business support processes.

AML and GDPR compliance: key steps

• Develop internal regulations and train staff on AML and GDPR.
• Integrate digital tools for monitoring trtransactions and data protection.
• Conduct regular audits and update procedures in accordance with changes in legislation.
• Apply COREDO’s best practices to minimize legal risks and increase investor confidence.

Optimizing investments and risk management in tech businesses

• Assess the ROI from implementing innovative technologies using comprehensive metrics.
• Implement internal control systems and compliance automation.
• Use insurance and hedging instruments to protect against financial and operational risks.
• Apply COREDO’s strategic approach to managing investments and risks at all stages of scaling.

The technological ecosystem of Europe: key findings and prospects

Successful development and scaling of a technology business in Europe requires integration of innovations, state support, and strict legal compliance. Europe’s technological ecosystem provides unique opportunities for growth but requires a deep understanding of regulatory requirements, investment strategies, and risk management.

In the coming years, the key challenges will be tighter regulation, competition for talent, and the need for continuous investment in innovation. At the same time, for those ready to act strategically and leverage the opportunities of the European technological ecosystem, prospects open up for large-scale growth and leadership in the global market.