The tech industry is booming in Lisbon. The city is buzzing with innovation, as start-ups and big name tech firms alike settle in. Discover how this era came to be and what it means for Portugal.
Back in 2016, a sense of excitement took hold of Portugal when the Dublin-founded Web Summit tech conference took place in Lisbon for the first time. It attracted over 50,000 attendees, filling the city’s hotels and opening many eyes to the attractions of a life in Portugal.
A new start: Web Summit…
It was the beginning of a new era for tech businesses in Lisbon.
Web Summit is a huge global conference, supported by the likes of Cisco, Microsoft, Amazon and Google. The original plan was for it to be based in Lisbon for three years, but the decision was then taken to make the city its permanent home. After a temporary move online during the pandemic, it’s continued to grow. It brought over 70,000 visitors to Lisbon in 2022.
On the first year of the conference, much attention was paid to the short term benefits it brought to Lisbon – not least a huge boost for the city’s hospitality businesses. Seven year later, Lisbon is known globally as a thriving hub for tech firms, entrepreneurs and start-ups – and that reputation continues to grow.
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Crypto – the next phase for tech businesses in Lisbon?
The latest accolade for Lisbon is being named as “the most important crypto hub on the planet”. This title was coined by Greenfield, a European crypto investment firm. CNBC recently reported on how Lisbon is now becoming a hub for crypto, blockchain projects and decentralised finance. Its article cites Portugal’s “bitcoin friendly tax laws” and its thriving community of expat tech specialists.
Legislation around cryptocurrency is reasonably consistent across mainland Europe, thanks to Markets in Crypto-Assets (MiCA) laws. However, there are considerable differences in how individual countries treat and (perhaps more significantly) tax cryptocurrency.
While laws have been tightened slightly of late, residents of Portugal can still pocket cryptocurrency gains tax free if coins have been held for over a year. Investors talk of doubling their profits due to the tax savings of moving to Portugal.
Of course, cryptocurrency still remains a complete mystery to many non-technical people. It’s sufficient to understand that cryptocurrency is yet another thing that’s come along to continue the stratospheric growth of tech businesses in Lisbon.
Capital of innovation?
The coming months will reveal whether Lisbon adds yet another string to its bow. The city has been named among the semi-finalists for the title of European Capital of Innovation for 2023. Its competitors include Kyiv, Istanbul and Warsaw.
Lisbon mayor Carlos Moedas cites the city’s “enormous capacity to attract companies and professionals from all over the world” – something impossible to argue with!
What attracts tech businesses and start-ups to Portugal?
Lisbon is a beautiful and agreeable city. Its likeness to San Francisco doesn’t go unnoticed by those referring to it as Europe’s closest thing to Silicon Valley. However, Portugal’s “tech hub” reputation hasn’t come about by chance.
Specific attractions of Lisbon (and Portugal in general) include:
Lisbon has turned itself into an attractive location for online workers.
The non-habitual resident tax scheme
The non-habitual resident tax scheme allows many entrepreneurs to receive their foreign-sourced income tax free for up to ten years. They can also pay a fixed rate of 20% on Portugal-sourced income. While the scheme is restricted to “high value individuals”, the list of qualifying professions is extensive.
It includes Information and Communication Technology Specialists and Technicians, ticking the box for most people working in the world of tech. It also includes “general managers and executive managers of companies”.
A range of visas
Not only can EU residents move to Portugal under freedom of movement laws, the country has also introduced a range of visas covering those from further afield. The most recent addition is the D7 visa for digital nomads.
While Portugal is sometimes known for its lengthy bureaucracy, many new arrivals mention how straightforward it is to gain residency and get business underway. In Lisbon, in particular, the influx of international residents has helped to crystalise procedures and make the experience more consistent. Plenty of companies also specialise in helping businesses and individuals gain the paperwork they need.
Travel connections
There are direct flights from Lisbon to over 130 destinations. London is just 2.5hours away, and travel to elsewhere in mainland Europe is straightforward – not just by plane, but increasingly by high-speed train. Lisbon’s airport is also only a short hop from the city centre by metro.
A vibrant community
From small crypto gatherings to international conferences, Lisbon is buzzing with like-minded people. The city is also packed with co-working spaces and freelancer-friendly bars and cafés.
Access to the big names
There’s a laundry list of big-name tech businesses in Lisbon. IBM, Cisco, SAP, Microsoft, Amazon, Oracle and Google all have HQs in the city. This is not only a boon for start-ups hoping to do business with those companies, but also for techies who work for them directly or as consultants.
The march of tech businesses in Lisbon has transformed Portugal’s capital in less than a decade. Not everybody is delighted. The impact of newcomers on the price and availability of homes is well-documented. However, it’s worth remembering that not that long ago, Portugal was one of the most hard-hit European countries in the wake of the financial crisis.
The government took steps to attract new talent, new money and new energy. They’ve certainly succeeded in that ambition.
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