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Swiss businesses and start-ups set record in 2019

Entrepreneurs are thriving in Switzerland, with a record number of companies launched in 2019 and unprecedented investment pumped into start-ups.

Switzerland saw 44,482 companies founded last year, the highest number to date and a 3% increase on 2018, according to the Swiss Official Gazette of Commerce. Investments in start-ups also grew strongly in 2019, topping CHF2 billion ($2.06 billion) for the first time.

In recent years innovation parks have multiplied to accommodate start-ups and SMEs in Switzerland, as here in Wohlen in canton Aargau (© Keystone / Gaetan Bally)

This comes as the slowdown in eurozone economies, uncertainties around Brexit and the trade war between the US and China all took a toll on Switzerland’s general economic performance. Gross domestic product growth was just 0.9% in 2019, according to the State Secretariat for Economic Affairs (SECO).

Measures taken by the federal government and cantonal authorities in recent years have helped reduce the legal and administrative burden for small and medium-sized enterprises (SMEs). The Swiss National Bank’s decision in 2015 to abandon a minimum exchange rate against the euro also helped.

Factoring in the companies that go out of business each year, Switzerland gains on average 5,000 new companies annually, the vast majority (99%) of them are SMEs, which have fewer than 250 employees.

Setting up a company is a risky business: only half manage to survive beyond five years. And according to the Federal Statistical Office (FSO), 8.7% of self-employed people were living in poverty in 2017, compared with 3.7% of employees.

New Companies Created in Switzerland, 2009-2019

New Companies Created in Switzerland, 2009-2019

- Click to enlarge

Men dominate

As is the case for top management and boards of directors, there is a clear predominance of men in business start-ups. In 2019, three-quarters of all companies were founded by men, according to analysis by the Institut für Jungunternehmen (IFJ).

The IFJ notes that Switzerland still lags slightly behind the international average in terms of the number of companies created by women.

Finally, a large share of Swiss start-ups are founded by students, PhD students, or recent graduates of high schools. These young companies are increasingly attracting the confidence of investors: funds made available to start-ups exceeded CHF1 billion for the first time in 2018, and went beyond CHF2 billion last year.

Capital Invested in Swiss Start-ups, 2012-2019

Capital Invested in Swiss Start-ups, 2012-2019

- Click to enlarge

(Translated by Dominique Soguel-dit-Picard)
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