How Europe can win the battle for tech talent

There’s no doubt that Europe has ambition. Over the last decade, we’ve laid the foundation for a thriving digital economy, from regulatory leadership to tech-driven reforms and rapidly growing regional hubs. But infrastructure alone doesn’t build the future; people do. And today, we face the very human challenge of how to win — and retain — the talent that powers innovation.

We’re seeing highly skilled individuals, such as founders, engineers, and product leaders, move their operations or careers to the US and, in some cases, to Asia. This trend reflects global competition at its fiercest. But it’s also a moment to reflect on what can make Europe uniquely capable of attracting and keeping the tech talent it needs.

Why talent moves — and why that’s not the whole story

In a deeply interconnected global market, talent follows opportunity. The US, for example, offers late-stage capital at a scale that’s still difficult to match in Europe. Its unified domestic market allows startups to grow without navigating the complex regulatory borders we often find in Europe. In areas like AI and deep tech, there are simply more large-scale deployments and resources to attract engineers hungry to push boundaries.

But talent doesn’t just move in one direction. Many entrepreneurs return with sharper skills, not only to build European ventures but also to reconnect with a sense of home and achieve a better work-life balance. Increasingly, founders are building cross-border teams, running product and engineering out of Europe while scaling sales or partnerships globally. 

Europe faces a test of its competitiveness and confidence in the global fight for talent. I believe we can meet this test, not by mimicking other ecosystems but by focusing on what sets us apart.

Sweden as a showcase of European strength

Sweden provides a powerful example of Europe’s strengths. With 41 unicorns, it ranks among the top 10 countries globally. Stockholm, its capital, is second only to Silicon Valley in unicorns per capita. Startups from Sweden have scaled globally yet stayed rooted in a strong local ecosystem.

What’s made that possible isn’t just capital — it’s also driven by a culture of trust, digital readiness, innovative infrastructure and long-term investment in education. Higher education is tuition-free for EU citizens, and digital public services, such as e-ID, have long been integrated into everyday life. There is a consistent alignment between the public and private sectors in supporting entrepreneurship.

This kind of foundation doesn’t guarantee success, but it does create a platform for talent to grow — and stay. And Sweden isn’t alone in fostering these conditions. Across the continent, cities like Tallinn, Lisbon, Berlin, and Málaga are developing tech ecosystems rooted in local strengths and specialisations — turning them into hubs for talent.

Europe’s strengths are structural and undervalued

Europe is often criticised — sometimes fairly — for being over-regulated, with policies that can slow down product cycles or add complexity for startups. However, these standards also serve a deeper purpose: to build the trust desired by modern consumers and talent alike.

Additionally, Europe invests early and equitably in its people. Many countries provide universal healthcare, subsidised childcare and free or low-cost education, reducing the personal financial risk of founding or joining a startup. For employees, this creates a broader sense of safety and support that extends beyond the workplace. This stability can be invaluable, giving more people the freedom to take meaningful entrepreneurial risks.

Europe tends to foster a different growth environment for startups than other global markets. With less access to hyper-scale capital, companies often grow at a more deliberate pace than their US counterparts. Stronger work protections and greater awareness of a startup’s footprint can also appeal to talent seeking more than just fast exits. For many of today’s builders, sustainability isn’t just about metrics, but about values.

Of course, the picture isn’t perfect. Fragmented regulation across EU member states, limited access to late-stage growth capital and complex cross-border hiring all create friction. In recent months, we’ve seen companies, particularly in fintech, tighten operations or shift capital toward the US, as global investors seek quicker returns and more predictable scaling environments. That dynamic risks pushing top talent out of Europe.

But these challenges aren’t unsolvable — and they’re not reasons to be pessimistic. They’re signals that we need to evolve faster, more boldly, and with a greater sense of cohesion across the continent.

What Europe must do next

To stop these forces from driving talent away, the first step is to reclaim the narrative. Europe is not a junior partner in global innovation; it is already leading in areas such as open banking, green technology and privacy-first digital services. Rather than framing all regulation as a burden, we should position certain key regulations as a competitive advantage. It creates stability and transparency that today’s talent and investors increasingly value. If we want the next generation of entrepreneurs to build here, they need to believe in the vision, and that starts with how we tell our story.

Second, Europe must address its regulatory fragmentation if it wants to unlock its full innovation potential. While our diversity is a strength, inconsistent rules across member states — from tax and employment law to data compliance and licensing — create friction for startups looking to operate across borders. This patchwork forces founders to choose between cities, when they should be able to build seamlessly throughout the bloc. Greater harmonisation of startup-relevant policies and more integrated funding mechanisms across markets would make Europe feel like one cohesive innovation space for tech talent, rather than a patchwork of jurisdictions.

The continent also needs to invest in homegrown innovation, retain ownership of its core digital infrastructure, and protect its intellectual property. That requires a stronger late-stage funding environment, more ambitious public-private R&D initiatives, and long-term support for innovative companies. It means continuing to build on what makes Europe unique. To deepen the talent pool, the continent’s long-term thinking, inclusivity, and sense of responsibility should be harnessed as competitive strengths, not just soft ideals.

A tech ecosystem worth building and staying for

Talent doesn’t only follow money — it also follows meaning. Today’s innovators want to work in environments where they can create real impact. They are looking for flexibility, diversity, trust and purpose. Europe is uniquely positioned to meet those expectations — if it embraces what makes it different. In a changing and uncertain world, Europe remains a stable democracy, offering a degree of security that can attract investor interest and capital. 

This is not a zero-sum game — and talent going abroad doesn’t mean Europe is losing. However, if we want to be a global innovation leader in the decade ahead, we need to champion our values, remove barriers, and tell our own story more effectively. If we do that, we can make Europe the place where world-class talent not only begins, but also belongs.