A new working paper from the OECD, one of the most authoritative voices on global economic policy, has just published one of the most comprehensive analyses of startup ecosystems ever assembled. Tracking nearly 4.5 million companies founded between 2000 and 2025 across every major region of the world, the report paints a striking picture of where innovation is thriving, where funding is flowing, and where the gaps are widest.
For anyone working in technology transfer, startup funding, or innovation strategy, this report is essential reading. At KnowTransfer, we've gone through it so you don't have to. Here's what it means for you.
The Biggest Finding:
Most Innovative Companies Never See a VC
Here is the number that should stop every innovation policymaker in their tracks:
Fewer than 0.1% of active companies in the United States receive venture capital funding.
And the US accounts for roughly 60% of all venture capital invested globally. Which means that in the rest of the world, including Europe, VC-backed companies are an even rarer species.
This matters enormously because virtually all of the databases researchers and policymakers have historically used to track startup activity were built around venture capital. They measured what VCs funded. Everything else (the grants, the angel rounds, the public innovation programmes, the university spinouts) was largely invisible.
The OECD's new database changes that. For the first time, we have a genuinely global picture of entrepreneurial activity that includes companies that never raised a VC round. And what it reveals is that the startup ecosystem is far larger, far more diverse, and far less well-served than the traditional data ever showed.
Europe Is Undercounting Its Own Innovation
When the OECD compared its new database against the official statistics published by national venture capital associations across Europe, the results were remarkable. The new database captured 104% more VC funding in Europe than what the official figures reported. In other words, European startup investment activity was more than double what the established benchmarks suggested.
This is not a rounding error. It reflects a structural problem: European innovation data has been captured through member surveys that asked VC firms to self-report, which systematically missed angel investors, family offices, non-member funds, and the enormous volume of grant-based funding that underpins a large share of European startups.
The gap is even more dramatic in other regions. In Japan, the OECD database captured 364% more funding than official figures. In Korea, 166% more. In Australia, 200% more.
What does this mean in practice? It means that the case for investing in innovation, including the evidence base that funders, policymakers, and corporate decision-makers rely on, has been systematically understating the scale and vibrancy of startup activity outside the United States for years. European innovators have been making their case with one hand tied behind their backs.
The Europe–Asia Shift Nobody Is Talking About
One of the most significant trends buried in the data is this: Asia has overtaken Europe in total startup deal volume.
In terms of the number of deals, Europe still ranks second globally behind North America. But when you look at the money (the actual euros, dollars, and yen flowing into startups), Asian companies surpassed European ones in the early 2020s and haven't looked back. Transactions within Asia and Oceania are approximately twice as large as those within Europe when measured by deal volume.
Meanwhile, the rest of the world, including Africa, Latin America, and Southeast Asia, is growing its startup base at a pace that far exceeds Europe and North America. The share of innovative startups is now roughly equal across North America, Europe, and Asia.
The global innovation landscape is rebalancing. The question for European innovators and investors is whether they are positioned to compete in that new landscape, or whether they are still operating as if the old geography of innovation still applies.
What Europe Does Differently, and Why It Matters
The OECD data reveals something important about how European startups fund themselves. In Europe, grants account for approximately 20% of all startup funding deals, far higher than in any other region. In North America and Asia, this figure is negligible.
This is a double-edged reality. On one hand, it reflects Europe's strong public innovation infrastructure: Horizon Europe, EIC grants, national innovation agencies, and the deep network of research institutions that seed technology development. This is genuinely a competitive advantage, and one that is chronically undervalued when it is not captured in the data.
On the other hand, grants are small relative to the scale of what startups need to grow. While they represent a significant share of the number of deals, their contribution to total deal volume is comparatively modest. Grants get companies started. They rarely get them scaled.
This is the European innovation paradox: exceptional at generating technology, weaker at commercialising it at scale.
This is precisely the gap that KnowTransfer exists to bridge.
The Commercialisation Bottleneck Is Real, and
Measurable
The OECD data makes the technology-to-market bottleneck visible in a way it has never been before. Among the nearly six million companies in the database, roughly 16% qualify as "innovative startups", meaning companies that either received funding or filed a patent.
Of those:
• Only 5.86% were VC-backed
• Only 4.59% had filed a patent
• Only 0.99% had completed an IPO
These are not failure rates. They are pipeline rates, measuring the proportion of companies at each stage of the journey from idea to market. And they tell us that for every company that successfully commercialises its technology through equity markets, there are hundreds that did not make it through the funnel.
What separates the companies that cross the bridge from those that don't? In our experience working with researchers, universities, SMEs, and technology companies across Spain and Europe, the answer is rarely the quality of the technology. It is almost always the infrastructure around it: the valuation expertise, the investor access, the go-to-market strategy, and the knowledge of how to navigate the funding landscape.
What the Data Tells Us About Patent Activity
The OECD report also tracks how patenting activity has evolved among startups over two decades.
Patent filings have grown steadily since 2010, with two sectors leading the expansion:
• ICT and software: patents in information and communication technology doubled their share of total filings, from 10% in 2000 to 20% by 2024
• Computer hardware and electronics: patents in this category grew from 20% to 30% of total filings over the same period
Meanwhile, manufacturing-related patents have declined as a share of the total. The economy is shifting toward software, platforms, and digital systems, and the patent landscape is following.
For companies holding IP in these categories, this is both good news and a warning. The value of well-protected digital IP has never been higher. But the landscape is also more competitive, more complex, and faster-moving than ever. Understanding what your IP is worth and how to use it has become a strategic imperative.
KnowTransfer's technology valuation services are built for exactly this environment.
Three Takeaways for Innovation Leaders
1. Your funding landscape is bigger than you think. The OECD data confirms that the funding universe, especially in Europe, is far larger than official statistics suggest. Angel investors, family offices, corporate venture arms, government programmes, and non-VC instruments collectively represent a substantial and growing pool of capital. If your fundraising strategy focuses only on traditional VC, you are looking at a small fraction of the available opportunity.
2. The commercialisation gap is the real bottleneck. Europe generates world-class research and technology. The constraint is not invention. It is the structured process of turning invention into market-ready products, finding the right buyers or investors, and navigating the transfer process. This is a solvable problem. It requires expertise, networks, and the right intermediaries.
3. Your IP is likely undervalued. With patent activity surging in ICT and digital technologies, and with investors across the globe actively seeking differentiated technology assets, there has never been a more important moment to understand what your intellectual property is actually worth. An honest, rigorous valuation is the foundation of every successful licensing deal, acquisition, or funding round.
How KnowTransfer Can Help
KnowTransfer is a technology transfer consultancy and sci-tech marketplace, certified by ENISA as an innovative startup under Spain's Law 28/2022, and supported by the EU's Activa Crecimiento programme.
We work with researchers, universities, SMEs, and technology companies to:
• Value your technology and IP: honest, rigorous, market-calibrated valuations
• Connect you with the right investors and funding: not just the obvious names, but the full landscape of public and private opportunity
• Navigate the technology transfer process: from university spinout to licensing deal to full commercial launch
• Build your go-to-market strategy: with a team that combines scientific expertise and business experience
The OECD's data confirms what we see every day: the gap between what European innovation creates and what it successfully brings to market is large, persistent, and entirely addressable.
We are building the bridge.
Reference:
Berger, M., Calligaris, S., Dechezleprêtre, A., Dernis, H., Greppi, A., Kirpichev, D. and Muñoz Alvarado, A. (2026), The OECD Start-ups Database: A new lens on the global entrepreneurial ecosystems, OECD Science, Technology and Industry Working Papers, 2026/04, OECD Publishing, Paris.
Available at: https://www.oecd.org/en/publications/the-oecd-start-ups-database_be8e5317-en.html