Over the past decade, Europe’s tech sector has grown to nearly $4 trillion in value and a workforce of more than 4.6 million people. But its economic gap with the US has widened in that time. Since 2019, the US economy has grown almost twice as fast, and its 50 largest companies are now worth around seven times as much as their European counterparts.
This divergence is also visible in Stripe’s commercial data. The Stripe SaaS Index, based on same-business revenue trends across an average of 72,000 SaaS companies each week, found that US SaaS growth had returned to and exceeded 2024 rates in 2026, while European growth returned to approximately its late 2024 and early 2025 pace.
For European policymakers, closing this economic gap is imperative. The 2024 Draghi Report and the European Commission’s 2025 Start Up and Scale Up Strategy and 2026 One Europe, One Market Roadmap each described possible policy interventions for legislators to advance.
An example is the reform of corporate legal regimes in Europe. An optional pan-European corporate form, commonly termed “EU Inc.,” is now in final-stage negotiations, with the institutions targeting political agreement by the end of 2026. The reform is intended to allow faster, cheaper, and digital-first procedures to reduce friction caused by fragmented law across Europe. It stands as an early test of the EU’s ability to deliver against its ambitious policy agenda with implications for the competitiveness of the European economy as a whole.
This guide examines European tech leaders’ views on Europe as a place to build. It asks whether policymakers’ emphasis on competitiveness has translated to improved business confidence. Examined through the lens of the EU Inc. proposal, it consolidates insights from a survey Stripe conducted among 200 founders, senior leaders, and policy leads at technology companies operating across the 27 EU countries. These findings establish three benchmarks of success policymakers should have top of mind when finalizing EU Inc. and wider competitiveness reforms.
Section 1: Europe’s tech sector has grown, but confidence remains fragile
Europe remains a strong place to start a technology company. Tech leaders recognize the level of education (66%), proximity of markets (61%), and depth and availability of talent (44%) as the three most commonly identified advantages of the European tech ecosystem. Some of the world’s most iconic enterprises and most promising startups are located here.
Despite these strengths, only 21% of those surveyed are confident about the potential for Europe to become the global tech leader in the next five years. These persistent doubts factor in decisions about where to start or grow their companies. Thirty-six percent of tech leaders said that the EU regulatory environment made them consider establishing or hiring elsewhere, up from 33% in our findings in 2022.
Starting a business in Europe is generally difficult. Economies and regulatory frameworks are not geared toward ‘fast fail’ models.”
When asked to identify a policy that would allow their company to grow quicker and in more markets, the most commonly cited solution by EU tech leaders (36%) was administrative harmonization and an EU Inc.–style corporate framework. The highest ranked solution in our 2022 survey was digital-first administrative procedures, the catalyst for a comprehensive regime such as EU Inc.
Our findings demonstrate the importance of delivering an ambitious and attractive EU Inc. as the culmination of long-standing demands for cohesive procedures that companies will choose to use versus global alternatives. Among builders, the first metric of success is adoption. Our findings show the market appetite, and the proposed benchmark aligns with the European Commission’s own projections for uptake of the EU Inc. corporate form.
Section 2: The promise and shortcomings of the European single market
The single market aims to simplify trade across Europe. By adhering to common rules, companies can streamline their compliance processes when selling to customers across the EU. For tech leaders, a shared operating infrastructure across borders enhances commercial opportunities. A majority of those surveyed (52%) strongly agreed that harmonization facilitates increased cross-border sales.
In practice however, many tech leaders described a single market as a fragmented experience. This impacts how leaders view Europe as an attractive investment environment: less than a third (29%) of leaders identify harmonized rules as a European advantage currently, down from 50% in the 2022 survey.
Today, the underlying EU rules are largely harmonised on paper but transposed and enforced differently in each country... That duplication is pure cost with no added security.”
That duplicative work uses time and resources companies might otherwise dedicate to building or entering new markets. Worryingly, nearly three-quarters (73%) of respondents said the time dedicated to regulatory compliance is increasing. This burden is not simply a nuisance; the majority of leaders (51%) pointed to it as the leading regulatory threat to their businesses.
Common, or harmonized, rules sit at the center of the EU Inc. proposal. Making company information easy to exchange and letting EU Inc. companies choose where to register their offices are two ways to make better use of the single market. These measures reduce complexity for founders and investors, freeing up resources to build and scale companies in Europe.
Beyond sign-ups, EU Inc. needs to solve central problems experienced by EU tech leaders. This transforms EU Inc. into a durable corporate form that businesses choose to adopt. The proposed benchmark measures how far EU Inc. can reverse the present-day experience for founders shown in our findings and provide a reduction in compliance burdens.
Section 3: Leveling the playing field for startups
Regulations can apply equally to every company, but the suitability of those rules and the ability to bear their cost varies with a company’s size, business model, and maturity. Eighty-one percent of tech leaders surveyed believe policymaking is designed around established corporations, while only 14% said it was designed with early-stage startups in mind.
Different rules around employment, taxation, and administration make scaling across Europe unnecessarily complex and expensive for early-stage tech companies. A more harmonised EU framework would let startups focus more resources on growth.”
For startups with fewer resources to understand and comply with complex regulations, this issue can slow investment and innovation. Early-stage companies feel this pressure acutely. Among respondents from companies less than a year old, 39% ranked the resources needed to build a policy, legal, or compliance team among the three leading threats to their businesses.
Our research found that innovation speed is a growing area of concern for newer and AI-focused companies. Just over a quarter (27%) of tech leaders cited it as a key disadvantage to operating in Europe, rising to 45% of AI-native companies.
Beyond administrative simplifications, the EU Inc. proposal responds to barriers that are felt strongly by startups and scaleups in Europe, but are less relevant to, or can often be absorbed by, more established companies. A workable common European framework for employee stock options would help startups compete for talent as they scale across Europe.
With identifiable demand and a solution to businesses’ problems, EU Inc. should earn strong approval and become a credible option for companies building and scaling in Europe. Our findings identify areas where confidence in the EU is low. The benchmark will judge whether the final framework satisfactorily addresses the company law problems startups and scaleups experience in practice.
Conclusion
As the adoption of AI and frontier technologies shortens innovation cycles, rewarding scale, risk-taking, and rapid iteration will become central to a successful European economic model. The EU Inc. proposal reflects these principles, but the challenge is whether the final framework translates them into outcomes that founders benefit from in practice. Data is necessary to judge outcomes, and this guide proposes three clear benchmarks that policymakers should reflect on when determining the final shape of the EU Inc. rules and against which Stripe will continue to gather businesses’ views as the implementation of EU Inc. progresses. As one of the first new initiatives to be delivered under the competitiveness agenda, raising the bar is important to restoring confidence in Europe as the place to scale and grow.
EU Inc. is one of many similar necessary reforms. From the research, a common set of parameters that support European competitiveness emerges: rules designed from the outset to fit the needs of startups; harmonized rather than fragmented laws; and policies that are used in practice and support faster innovation cycles. Those surveyed offered ideas for specific policy changes, including further simplification, the use of regulatory sandboxing, or measures that enable Europe to lead in capturing the opportunities of frontier technologies.
Notably, founders and leaders do not simply call for regulatory repeals. Instead, leaders seek decisive, rather than incremental, improvement to the common rules of the road and to capitalize on a single market that delivers against its promise.
If you would like to contribute to the next phase of research, examining how the EU can further improve its regulatory environment and support starting, scaling, and growing, please sign up here.
About the survey
Europe has the talent and ideas to build global companies. Stripe employs more than 1,000 people in Europe, where more than two million businesses use our products. The task now is to make it easier for the next generation of founders to build and scale in Europe. To understand their perceptions and experiences, Stripe surveyed 200 founders, senior leaders, and policy leads at technology companies operating across the 27 EU member states. The 20-question online survey was conducted in August and September 2026 and included companies in SaaS, AI, fintech, ecommerce, marketplaces, health tech, and other technology sectors. Open-ended questions provided additional context for the quantitative findings. The results are compared with a 2022 baseline of 146 EU technology leaders.