This is definitely interesting data and I would assume that the following factors could be at play here: Germany has exceptional engineering talent that is distributed across the country, thanks to the breadth of excellent universities. This allows founders to start companies in cities where living costs are still fairly low and in addition to that benefit from remote talent to complement their respective teams.
The more that Europe sees the emergence of successful companies that have scaled to billions of dollars of enterprise value, hundreds of millions of revenue or thousands of employees, the deeper and broader is able to grow its pool of experienced operators that have helped to build and scale world-class products, design, build and run large-scale organisations, or grow billion-dollar P&Ls.
As these companies then go through the full lifecycle, including an exit event via an IPO or M&A, they can play an important role in injecting scale and liquidity into the talent marketplace. This potential to recycle talent is a crucial enabler to accelerate the progression of the ecosystem by unlocking new generations of founders and operators that are powered by extensive knowledge and networks hard earned through their exposure to the ups and downs of the company-building process.
To contribute to a better understanding of the scale of talent recycling at work in the European tech ecosystem, we have attempted to quantify the number of founders that have started companies having previously gained experience in some of Europe’s most successful companies. More specifically, this focused on the founder alumni networks of 24 European tech companies that have previously scaled to a valuation of $5 billion or more.