When looking at Central European countries in the context of startups, the Czech Republic — led by its capital, Prague — clearly ranks among the strongest. This bold statement is supported primarily by its placement in the Global Startup Ecosystem Index 2025, where it ranked 30th globally. At the same time, compared to last year, the ecosystem consisting of 701 startups registered by StartupBlink grew by more than 17 percent. Although there was a significant drop in funding between 2022 and 2023 — approximately by 50 percent — the year 2025 is already showing signs of recovery. A report by the company Eleven states that in the first months, five investment rounds took place with a total value of 24.8 million EUR, representing a year-on-year increase of 61 percent.* In general, investments in artificial intelligence, fintech, and data analytics are coming to the forefront. In order to increase competitiveness, the Czech Republic has also made a significant step forward on the legislative front. The amendment on Employee Stock Ownership Plans (ESOP), approved in 2025, introduces the possibility of deferring taxation of options linked to the company’s shares, which ultimately makes it easier for startups to motivate and retain specialists. It will take full effect on January 1, 2026.

Slovakia

The country in the heart of Europe, Slovakia, may remain a smaller player, but its startup scene is growing faster than that of the Czech Republic. In the aforementioned global ranking, it moved up to 60th place, while its ecosystem grew by almost 24 percent, thanks to a total of 183 startups. However, in terms of innovation performance, Slovakia lags behind. The European Innovation Index places it in the category of “Emerging Innovator,” with performance at 63 percent of the European average, reflecting that Slovakia still has room for improvement — especially in science, research, and digitalization. The key issue in this case lies in regulatory barriers. Since July 2025, Slovakia has introduced new quotas for temporary residence permits for the purpose of business for third-country nationals — only 700 applications per year — and has also tightened requirements for submitting business plans. Despite these restrictions, the Slovak market still represents an attractive opportunity for investors, thanks to low costs, a growing technical community, and successful examples such as InoBat and Vacuumlabs, which strengthen the country’s reputation in the fields of battery technology and fintech.

European Context

In the Innovation Performance Index for 2025, the European Union maintained a stable position, although it declined slightly compared to the previous year — by 0.4 percentage points. Since 2018, however, its innovation performance has increased by 12.6 points, confirming a long-term trend of improvement. Other statistics show that the volume of European venture capital financing in 2024 stabilized at 45 billion USD, representing a decrease compared to the previous year, as the 2023 figure stood at 47 billion USD. A more significant comparison is with 2021, when, according to Atomico, venture capital funding reached as much as 101 billion USD. On the positive side, activity in capital markets is picking up again — after a long period without major IPOs, European exchanges are preparing for the return of public offerings, which could revive later-stage financing, a long-standing challenge in the region.

The Future of Startups in the Region

A comparison of the Czech Republic, Slovakia, and the EU shows that although all three entities aim to support technological innovation, they do so in relatively different ways. The Czech Republic positions itself as a stable player with rapidly growing legislative support and an increasing number of investments. Slovakia, on the other hand, can boast fast growth and internationally recognized projects — though it remains hindered by regulatory restrictions. Finally, the European Union has a strong capital base and a direction toward long-term stabilization, but challenges in later-stage financing continue to persist.

*Past performance is not a guarantee of future results.

This text represents marketing communication. It does not constitute any form of investment advice, investment research, or an offer of any transaction involving a financial instrument. The content of this text does not take into account individual readers’ circumstances, experience, or financial situation. Past performance is not a guarantee or prediction of future results.