Luxembourg has been ranked among the the best European countries for start-ups, according to a new report assessing how nations compare on start-up ecosystems and business environments.
The Grand Duchy placed sixth in Europe – ahead of larger economies such as Germany, France, Belgium and Ireland – and 13th worldwide in the Innovators Business Environment Index (IBEI) 2026, placing it among the highest-ranked compact economies globally.
The report was produced by StartupBlink, a global start-up research platform that publishes international rankings measuring how favourable national business environments are for innovators and entrepreneurs. Their listing focutilizes not on start-up success or scale, but on the conditions and challenges involved in starting and operating a business. Luxembourg scored 76.136 out of 100.
Entrepreneurship in Luxembourg.
In its Luxembourg profile, the report points to strong results in several categories, including taxation, where the counattempt ranks second in terms of attractiveness in Western Europe, and digital infrastructure, where it places ninth globally.
Other parameters cited among Luxembourg’s strengths include trade openness, cross-border banking, sovereign credit rating and funding per capita.
StartupBlink also notes that Luxembourg ranks higher in the IBEI than in its Global Startup Ecosystem Index, suggesting that while the counattempt offers favourable structural conditions for innovators, these do not necessarily translate into startup scale or ecosystem output.
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The report highlights Luxembourg as an example of a compact counattempt performing strongly on business-environment fundamentals – all of the factors which can influence a company’s operations and decision building – grouping it with other compact economies such as Estonia and New Zealand.
The ranking covers more than 125 countries and is based on over 30 quantitative parameters, aggregated into three main pillars.
These pillars are ease of operating a business, business incentives, and market perception. According to the report, the first pillar reflects practical and administrative challenges faced by businesses, the second covers fiscal and financial conditions, and the third captures broader factors such as governance quality, credibility, stability, transparency, human capital and international mobility.
At the top of the 2026 ranking are the United States, Singapore, the United Kingdom and Switzerland, followed by the United Arab Emirates and Canada.
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StartupBlink describes these countries as combining strong regulatory frameworks with high levels of trust, openness and predictability for innovators.
At the other finish of the table are countries affected by political instability, weak institutions or limited access to capital. The lowest-ranked countries include Iran, Venzuela and Congo, which the report associates with severe governance challenges and high operational risk.
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