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When I tell the UK contacts of our Cambridge office that my company is headquartered in Biscay, I still sometimes get asked ‘where’? The startup ecosystem of Biscay in the Basque Country in Northern Spain, capital city Bilbao, is still not as well-known as Spain’s other tech Mecca, Barcelona. As with Barcelona, innovators are also partly attracted to Biscay – located on Spain’s Atlantic coast – for lifestyle reasons. There are wonderful beaches and food, and a very bucolic environment with access to nature and hiking that appeals to many Silicon Valley entrepreneurs; people here are known for their longevity.

It was not, however, for quality of life reasons that we chose to establish our headquarters in Biscay. Our company started its life in the US, having been spun out of the University of Florida in 2013 by a professor of astrophysics. His big idea was to use the optical technology that is deployed to observe stars in deep space for instance by the Hubble Telescope to look down at the Earth in order to achieve high-resolution monitoring of geographical features.

We considered keeping our headquarters in Florida but ultimately decided to establish them in Biscay in 2014 because of the industrial ecosystem in that existed in the region. There were financial instruments and support available to start-ups from the government of Biscay, including a €50M government award of seed capital and additional grants to help with expenses. We now have operations in Florida, France, and the UK – through the strategic acquisition of the majority of a Cambridge-based company in 2023 – but our headquarters remain in Biscay.

When people ask why we have chosen to be a Basque company, we tell them three things about the startup ecosystem in Biscay which often come as a surprise to them:

High level of public funding and support for startups

The Government of Biscay enjoys a great deal of autonomy. It’s not like a UK regional authority, it has the ability to set its own taxes and decide on spending. One of the things in which the Biscay Government is particularly committed to investing is its start-up hub and incubators, due to a prevalent belief that start-ups have the ability to improve the competitiveness of the region.

Any startup that is headquartered in Biscay – and indeed, some companies headquartered elsewhere in Europe which have their manufacturing facilities in Biscay – are therefore able to apply for a raft of public-led support. This is both financial (in the form of investment) and practical; recognising that the scientists who have developed pioneering tech, often in a university setting, may need training in the skills needed to establish and administer a company.

There are three levels to this support. The Biscay Government receives around 120 applications per year from innovators seeking a grant to support them in creating a start-up. Of these, the Biscay Government helps around 70 per year, resulting in the creation of 40-50 start-ups annually. These companies can then apply for public funds, grants of up to €60,000 to support a one-year analysis of the viability of their project, for example by looking at a prototype or conducting a financial study. Of these 40-50 startups, 80% survive long-term, which is a very attractive figure and the one which was the deciding factor for us in relocating to Biscay.

If the Department of Entrepreneurship, Talent and Business Competitiveness thinks that a startup is suitable after a year of development, it will facilitate the company’s launch via a new grant of up to €85,000. This is intended to go towards developing a marketing plan, hiring a CEO and helping with expenses over the first two years of the company’s life. Companies in receipt of a grant are provided with tailored, free training for entrepreneurs. This is delivered by BEAZ, a public company that helps the Department to promote an entrepreneurial ecosystem – and one which generates innovative tech – by working closely with startups at the launch and scaling-up stage. BEAZ delivers training in 6-7 subjects, for example on public speaking and on how to secure funding from private investors. Following completion of the training, they are then provided with free mentorship from a specialist in the department’s network.

SATLANTIS was selected to participate in an internationalization program together with five Biscay SMEs travelling to Boston and Israel in 2019, an initiative organized by DFB and CArdumen Capital. As part of our participation in Biscay’s accelerator programme we also had access to further training and €90,000 in investment funds from Seed Capital Bizkaia, a Biscay Government public company that has different funds available – from pre-seed funds to series A funds – to assist a start-up in scaling up. We received two different rounds of seed capital worth €250,000 and €1,000,000. We also benefitted from a tax tool, based on R&D&I deduction to develop our technology (called art 64 bis). The first disbursement corresponded to our first capital round in 2016 of €2.2 million, and the second belongs to the €27m in 2022. Today the company hosts €32 million in cash, and employs 170 staff, with the majority based in Bilbao, together with operations in Cambridge, Bayonne and Florida.

Environmental infrastructure and hydrogen corridor

Our technology has particularly important applications in tracking emissions of methane, the gas with the potential to make the biggest impact on climate change. As a climate tech company, it was therefore also important to us that Biscay – a region best known for its heavy industry – has launched a plethora of initiatives aimed at creating green skills and transitioning the region’s industry to be run on hydrogen instead of fossil fuels. This has included establishing centralized large-scale hydrogen production by building Europe’s largest green hydrogen plant located at the Port of Bilbao, with a 100-megawatt electrolyzer. There is also hydrogen mass storage in salt caves and Biscay is building a hydrogen port and corridor to import and export hydrogen between Bilbao and Amsterdam. The overall aim is to develop hydrogen and mixed-hydrogen fuels which are suitable for use by heavy industry.

There is also a great deal of green skills training available in the region, which is developing the integration of renewables into smart grids which can forecast and manage intermittent generation. Biscay has set up the Global Smart Grids Innovation Hub and the  Smart Grids Academy, the first academy worldwide to train professionals in new digital skills required by the energy transition and the future of smart grids.  

Close-knit and supportive business community

As well as having close ties with the rest of Spain and with Latin America, and of course with the French Basque Country, Biscay has a particularly tightly knit and supportive regional business community. We’ve found that there’s a high degree of people talking to each other across the private-public sector divide. As a result, deals are put together, clients are found and investment can be secured more easily than in some other parts of Europe. I think that this is in part due to the strong and distinct cultural and political identity of the Basque Country, which of course includes its own language which is co-official with Spanish. There’s a great sense of solidarity here and a desire to make the region a success for business and innovation, and that’s energising.

Juan Tomás Hermani is the CEO of Satlantis, which conducts high-resolution Earth observation via observation devices installed both on satellites and on the International Space Station itself.