London has been named as the best city in Europe for digital entrepreneurs, according to a new European Digital City Index.

The capital beat rivals Paris, Berlin and Amsterdam to be named as the number one destination for digital entrepreneurs looking to start and scale up a digital business.

The European Digital City Index, is launched by the UK innovation foundation, Nesta, as part of its work on the European Digital Forum, a project to promote the digital economy.

The Index (www.digitalcityindex.eu) measures and ranks the EU’s capital cities and known digital innovation hubs against ten criteria set by digital businesses and supported by policymakers and academics. The criteria relate to a city’s ecosystem and include digital infrastructure, culture, and skills availability.

Entrepreneurs can identify the strengths and weaknesses of a particular city and help policymakers understand where they need to devote more resources to make a city more attractive to digital businesses.

Top Ten Cities for Digital Entrepreneurs:
Ranking         Start-ups       Scale-ups
1                    London              London
2                    Amsterdam        Stockholm
3                    Stockholm          Amsterdam
4                    Helsinki              Helsinki
5                    Copenhagen      Copenhagen
6                    Paris                  Paris
7                    Berlin                 Brussels
8                    Dublin                Dublin
9                    Brussels            Berlin
10                  Munich              Munich

London scores highest overall for startups and scale-ups and specifically for access to capital, entrepreneurial culture and knowledge spillovers. Other UK cities that feature on the list include Cambridge and Oxford which appear 11th and 13th respectively for startups and scale-ups.

Berlin, which has produced a number of billion dollar startups, including online fashion shop Zalando and restaurant delivery service Delivery Hero, is only ranked 7th for these businesses. This is because of its expensive and relatively sluggish digital infrastructure and high cost associated with employing staff.

Brussels scores higher for scale-ups because of its greater access to capital.

Chris Haley, Head of Startups and New Technology Research at Nesta, said, “Entrepreneurship, particularly digital entrepreneurship, is vitally important for innovation and growth but not all cities provide equally fertile ground for these businesses. Our research indicates that location does matter, and illustrates the ways in which top cities create a supportive environment and where lessons can be learnt.”