Belgium’s capital city is becoming known for more than just housing major international institutions like EU Parliament, EU Commission and NATO. The region is also home to an active and fast-growing startup scene. In this week’s Tech Center tracker, Patrick Lastennet, director of business development and financial services for Interxion, joined PYMNTS to discuss the continued development of Belgium’s tech environment and how it may make Brussels a go-to destination following Brexit.
Before we jump into the post, here are a few quick facts about Brussels and its tech scene:
- Brussels has an estimated population of 1,019,022, making it the largest city in Belgium.
- Brussels the third wealthiest region in terms of GDP per capita due to this number being twice as high as the European average.
- The city was ranked as a strong innovator by the latest edition of the Regional Innovation Scoreboard (RIS 2016).
- Brussels is home to numerous international institutions, including EU Parliament, the European Commission and the Council, NATO, Eurocontrol and many more.
- The World Bank ranked Belgium as the seventeenth best country in which to do business in 2017, out of 190 regions. It was also ranked in first place for trading across borders.
- The country’s “Digital Belgium” initiative is an ongoing effort to bring Belgium into the digital top three of the European Digital Economy and Society Index by the year 2020. The plan also hopes to help the country see 1,000 new startups take root and 50,000 new jobs to be created in a variety of sectors.
- Brussels is the second most diverse city in the world and is known for being a multinational, multilingual and multi-industry region.
Belgium is on the path toward a digital revolution.
Its capital city of Brussels, which serves as a home base for various international organizations, is working to also becomes a top contender as a global tech center.
The country has a long-term vision to put Belgium on the digital map, which involves a strategic focus on five priorities: digital infrastructure, digital confidence and digital security, digital skills and jobs, digital economy, and digital government.
Though the “Digital Belgium” initiative, Belgium’s Deputy Prime Minister and Minister for the Digital Agenda Alexander De Croo said by 2020 the country plans to be ranked in the digital top three in the European Digital Economy and Society Index, become home to 1,000 new startups and create 50,000 new jobs.
It’s an ambitious plan, but being at the center of Europe — where corporates, startup resources and policy makers all converge — and having a buzzing hub of entrepreneurship provide a strong foundation for the country’s digital revolution goals.
Patrick Lastennet, director of business development and financial services for Interxion, which specializes in colocation services for companies that want to establish a physical presence in the EU, also noted that the Belgian government is intent on promoting FinTech innovation.
This has the potential to setup Brussels a top destination for companies looking to escape the uncertainty of operating in a post-Brexit U.K. environment.
“The sector has primarily been driven by the larger bank and insurance industry players, but with the new impetus to attract more financial tech business in the wake of Brexit and a concerted effort for regulation to facilitate cloud adoption, we believe there will be an increase in positive growth for startups,” Lastennet explained.
Just last month, Belgium and London formed a “FinTech bridge” to help enable a supportive link between startups in both jurisdictions.
The Brussels-based hub B-Hive is a new FinTech platform designed to facilitate innovation between the FinTech sector in Belgium and other traditional financial and technology sectors. The Belgian government signed a memorandum of understanding (MoU) with the trade body for Britain’s FinTech sector, Innovate Finance, last month officially establishing the “FinTech bridge.”
When it comes to the country’s overarching tech and startup ecosystem, Lastennet said that efforts are also being made to establish Belgium/Brussels as the continental European bridgehead to the U.K.
“In addition to serving as a home of several large global payment institutions, Brussels is also the European center for interfacing with the key EU policy makers that are shaping regulations around digital transformation and innovation,” he added, such as Digital Europe, the European organization that represents the digital technology industry across the region.
Belgium also offers other attractive features to both entrepreneurs and investors, including an overall high quality of life, close proximity to other major European cities and a tax regime that is highly favorable to successful entrepreneurs.
However, there are some challenges that startups operating in Brussels do have to overcome. Lastennet said that compared with the very strong competition across Europe for attracting both established companies and startups, Belgium is still considered a relatively small market.
But as the country’s digital infrastructure and tech ecosystem continue to evolve, many efforts are being put forth to address those barriers.
“The combination of emphasis on compliance-driven innovation and the onset of Brexit could lead to a resurgence of activity,” Lastennet stated.