68% of European tech startups already integrating AI to boost performance

Over two-thirds (68%) of European tech startups are already maximising the benefits of artificial intelligence (AI) and 58% plan to invest in AI in the near future, according to a new report by Cloudvisor, an Advanced Tier AWS Partner, and PwC Lithuania.

The Tech Trends: Current and Future Landscapes of European Tech Startups report, which surveyed more than 700 startups, found that AI is a central focus for startups with ambitions to transform various business functions, with 67% using AI for data analysis, and 53% planning to. The overwhelming interest in AI underscores its perceived value as a critical tool for driving innovation and business growth.

High adoption of emerging technologies

An overwhelming majority (91%) of startups use at least one emerging technology. Startups particularly prioritise AI, including Generative AI – capable of generating text, images, videos, or other data using generative models – but are also using data analytics and big data (47%), machine learning (ML; 32%) and 5G technology (22%).

Tech spending continues

Despite sluggish funding into the startup ecosystem, the majority of those surveyed remain resilient in their technology investment plans. Almost half (47%) reported no change in their technology investment plans, and 11% have increased their budgets.

Cost-effectiveness and gaining a competitive advantage

Increasing cost-effectiveness (54%) and gaining competitive advantage (38%) are the main drivers behind technology adoption, emphasising startups' focus on efficiency and market positioning. These factors drive strategic decisions as startups seek to maximise the ROI of their technology spend and differentiate themselves in a competitive landscape.

Amazon Web Services (AWS) dominates the web hosting landscape

AWS emerges as the clear frontrunner, with 50% of startups selecting it as their preferred web hosting provider. Following AWS, Cloudflare Hosting holds a notable market share at 27%, while Google Cloud, DigitalOcean, and Microsoft Azure account for 12%, 6%, and 3%, respectively.

“The European startup landscape is complex and dynamic, focusing increasingly on emerging technologies like AI, ML and data analytics. Despite economic uncertainties, our report shows that many startups continue to invest strategically in technology to gain competitive advantages and drive efficiency,” said Julius Gregorauskas, CEO of Cloudvisor.

“From Web Hosting to AI, Big Data, and beyond, the findings of this report underscore the pivotal role of digital infrastructure and emerging technologies in steering startups towards digital excellence and success. Serving as a helpful resource for stakeholders across the startup ecosystem, this report empowers informed decision-making and could foster sustainable growth,” said Linas Stankevicius, Senior Consultant of PwC Lithuania.

The report, which explores technological trends and investment strategies that define the European startup ecosystem, also provides valuable insights into digital infrastructure and communication solutions:

● CMS provider: 67% of startups choose WordPress, while Webflow and Wix capture a noteworthy 24% and 5% respectively.

● Analytics and tracking: Google Analytics commands 45% of the market, followed by Hotjar (26%).

● CRM platform: 76% of startups choose HubSpot to satisfy their CRM needs. Salesforce follows with an 18% share.

● Support and feedback management: Zendesk leads the pack, commanding 46% of the market. Intercom follows closely behind with 37%.