2023 is the year of resilience and adaptability.  

It is clear that the tides of the global startup ecosystem have shifted. As expected, high interest rates have ended the era of cheap money, slashing valuations and forcing startups to focus on what really matters: profitability and sustainable business models.

This is a good thing. The startup ecosystem is going through a cycle of cleaning; “vitamin” startups that provide luxury are out, and “aspirin” startups that reduce real pain are getting the attention they deserve. Some of the world’s most successful startups were born in a period when easy funding was not available, and we expect the same to happen in this period as well.

Taking the results of the Global Startup Ecosystem Index (GSEI) into account when charting your startup course is now more important than ever. This period is all about precision and focus. In a time when wrong decisions can determine the fate of our startups, a key decision we all need to think about is the following: “Where should we build our startup?”

This is a question that is not asked often enough. When successful founders share details about their moments of breakthrough, we find many startups were born from chance encounters, unexpected connections, or insights that arrived from a random conversation. Those moments tend to happen in thriving startup ecosystems, with a concentration of high quality startup stakeholders and a general mindset of cooperative innovation. 

Not everyone can be in the best global startup ecosystems. It depends on our ambitions and unique life circumstances. But if our Index can offer you options to improve your current situation by relocating to a more robust and active ecosystem, we encourage you to do so. The impact of this change will be a happy surprise. 

Our basic rule of Leave it or Lead it for underperforming startup ecosystems stays the same. If your life circumstances do not allow you to leave an underperforming startup ecosystem and relocate, remember that you can take a more active role in helping your startup ecosystem grow. Organize small gatherings, open a startup whatsapp group, mentor, and seek mentors.

This year more than 100 governments have partnered with us in preparation of the Index release. These governments get it. They understand that a great startup ecosystem is a future engine of economic growth and that the government should take an active role in supporting the growth of their startups. Those that ignore this responsibility and fail to budget for ecosystem development infrastructure are paying a massive price in brain drain, as their most ambitious talent leaves for growing startup hubs. 

Every country should strive to become a startup nation. Every city should focus on becoming a startup hub. In the past, oil and natural resources were distributed randomly between countries, and success happened largely by chance.