Executive Summary: Europe's Moonshot Moment: Fuelling its Tech Ecosystem for Scale

This report is a collaborative publication by McKinsey & Company and Boardwave and is based on qualitative and quantitative research conducted from September 25, 2024 to April 25, 2025.

Europe’s technology ecosystem stands at a turning point. While this ecosystem has matured significantly over the past decade, persistent structural barriers—fragmented markets, conservative corporate norms, and a slower flow of late-stage capital relative to early-stage investment—continue to constrain the region’s ability to scale global champions. However, a rare alignment of geopolitical, regulatory, and technological shifts is creating new momentum and, with it, a window to build global leadership.

This report offers an insider’s perspective of what is working and where targeted shifts could meaningfully accelerate the growth and success of start-ups and scale-ups. Produced jointly by McKinsey and Boardwave,1 the report is grounded in firsthand insights from conversations with more than 30 European tech founders, CEOs, investors, and ecosystem leaders, along with Boardwave’s annual member survey. The findings are further sharpened by an analysis of the continent’s top performing and fastest-growing software companies: those reaching more than €100 million in annual recurring revenue (ARR) within ten years or more than €500 million ARR in 20 years.

Taken together, the research findings indicate a striking consensus: What’s missing is not raw ingredients; Europe has world-class talent, growing capital pools, and committed institutions. Rather, what’s needed is the coordinated mobilization to set in motion the continent’s innovation flywheel to catalyze entrepreneurship, attract more risk-taking investment, and reach critical mass for turning these foundations into global outcomes. This is a moonshot moment, a rare point in time where the right vision, aligned resources, and decisive action could position Europe’s start-ups to lead in the next wave of technological and industrial innovation.

To seize the moment, ecosystem players can consider a set of priority actions centered on four ecosystem levers: leadership, incentives, focus, and teaming (LIFT). These actions include key strategies for founders and CEOs. They also include critical support that institutions (including governments, universities, and corporations), investors, and industry groups may consider, providing a shared agenda to turn today’s momentum into sustained scale.

Leadership strengthens the culture to prioritize scale and long-term growth. For founders and CEOs, that means assembling a diverse, growth-oriented management team and board of directors that can embed risk taking into company culture. For institutions, investors, and other ecosystem players, it can include providing more strategic guidance for scaling, including playbooks with best practices and support for pan-European innovation initiatives.

Incentives align financial structures to reward long-term, innovation-driven growth. The research suggests this could include company incentives built for boldness, such as founder-friendly equity models and long-term capital that reward ambition over short-term gains. It could also include targeted university incentives, growth-oriented procurement by governments and corporations, and consistent fiscal policies across markets.

Focus directs time, energy, and resources to areas that will matter for scale rather than localized growth. Anchoring the effort are globally minded founders who build for international scale from the outset and expand through strategic partnerships and targeted M&A. Ecosystem players can help shape the environment by supporting critical technology sectors and streamlining the foundational enablers of scale—talent mobility, administrative simplicity, and cross-border alignment.

Teaming is about learning faster together and inspiring the next generation to follow. Integral to this, the research finds, are well-executed go-to-market (GTM) strategies— supported by the talent to drive them—and engagement with industry groups and networks to share lessons and accelerate collective progress. At the same time, ecosystem players can cultivate forums and initiatives where ideas, experiences, and scaling successes are openly exchanged, where entrepreneurship is culturally celebrated, and where tomorrow’s founders are inspired to imagine what is possible.

Read the full report here.