Austria invests heavily in science and technology, ranking among Europe’s top nations for research and development spending, yet it significantly underperforms in translating that scientific strength into successful companies, economic growth, and new jobs. A new expert paper published by the Vienna-based firm New Venture Scouting highlights a stark gap between the country’s academic output and its commercialization weakness, a challenge mirroring the broader “European Paradox”.
The report, dated August 2025, reveals that while Austria is a leader in public R&D expenditures, it has slipped from 6th to 8th place in the European Union’s innovation rankings. The disparity is most pronounced when compared to the United States. In areas like venture capital investment per capita and the number of “unicorn” companies—startups valued at over $1 billion—Austria’s performance is just a fraction of that in the U.S.. Globally, over 60% of unicorns are based in the U.S., compared to only 8% in the EU.
The heart of the problem, according to the report, is the creation of academic spin-offs, which are new companies founded on university research and are considered a key mechanism for transforming knowledge into prosperity. Austria, however, generates only about 90 such academic startups per year. This weakness is illustrated in a comparison of universities across the German-speaking world, where not a single Austrian university ranks in the top 10 for startups founded between 2014 and 2024. The numbers are even more telling for companies based directly on university-owned intellectual property; in 2024, all of Austria’s public universities combined produced just 22 such “exploitation spin-offs,” a figure lower than the output of single leading European universities like the University of Cambridge or ETH Zürich.
A primary obstacle identified in the report is a severe lack of venture capital. Venture capital investments in the U.S. were four to five times higher than in the EU in 2023. Austria itself ranks 16th among EU countries for venture capital investments relative to its GDP, falling below the EU average. This funding gap makes it exceedingly difficult for promising spin-offs to evolve into larger “scale-ups”.
Despite the challenges, the Austrian government has recognized the issue, with its FTI-Strategy 2030 aiming to double the number of successful academic spin-offs. The report argues that Austria’s relatively late start in systematically promoting this area—only beginning in earnest 10 to 15 years ago—means it must now accelerate its efforts by learning from established ecosystems in the U.S., U.K., and Switzerland.
To do so, the authors propose a multi-layered strategy. The paper argues for regional cooperation, urging different institutions to bundle their strengths to create a “critical mass” of projects. Such an approach, it suggests, would make the Austrian ecosystem more visible and attractive to international investors and corporate partners. This must be paired with direct action at the university level, where institutions must become more proactive by actively “scouting” for commercial potential within their research labs, providing professional support from commercially experienced teams, and acting as a crucial “door-opener” to capital for fledgling companies.
According to a separate study cited in the paper, every euro invested in targeted support for spin-offs generates seven euros in GDP growth. The report concludes that a concerted effort could close the innovation gap and position Austria as a leading innovation hub in Europe.
