Biscay turns industrial roots into €9.4 billion startup cluster

A €9.4 billion hub built on industrial roots

Biscay, a region in Spain’s Basque Country, has built a €9.4 billion startup cluster by expanding its industrial base into biotechnology, advanced manufacturing and deeptech. The region now counts more than 300 companies, 20 research centres, four universities and several leading hospitals. Together they employ 62,000 people and generate €9.4 billion a year, concentrating on life sciences, robotics and renewable energy.

Life sciences dominate the ecosystem. Biscay hosts 45% of the Basque Country’s life-sciences firms and 56% of its sector revenues. Over 135 companies employ 27,000 people and contribute €5.2 billion to the regional economy, specialising in biomanufacturing and advanced therapies.

Public money and tax breaks fuel growth

I+Med is leading a €72 million bioscience and healthcare project that will run for three years and create more than 600 jobs. The initiative sets aside €28 million for R&D, reinforcing Biscay’s ambition in biomanufacturing and healthcare innovation, according to Tech.eu.

Tax breaks are central to the region’s growth. Investors in startups can deduct 35% of their personal income tax. Capital gains on exits are 50% tax-free, or completely exempt if the money is reinvested in new startups or technology ventures. Companies can claim back up to 70% of their R&D costs and 15-20% of their technological innovation spend.

To attract global talent, Biscay offers professionals moving from abroad a tax exemption on up to half their salary for 11 years. The region has also built specialist centres: the Energy Intelligence Centre, the Basque Hydrogen Corridor and the Bizkaia Quantum Advanced Industries initiative.

Grants and co-investment help startups at every stage

Biscay’s support for startups is split into three phases. First, entrepreneurs can apply for grants of up to €60,000 to validate ideas through prototyping, market tests and commercial analysis. Next, the Creation of Innovative Companies programme offers up to €85,000 for costs like incorporation, intellectual property, premises and hiring specialists.

Seed Capital Bizkaia, the region’s public venture-capital firm, then steps in. It covers 40-50% of each funding round through loans and equity, blending public and private capital. Oscar Ugarte, its director, told Tech.eu that banks are both shareholders and co-investors. Since 2019 the firm has also run a crowdfunding platform that backs projects with social or environmental impact, typically raising €100,000 to €200,000 per round.

Agencies remove hurdles for founders and talent

Public agencies in Biscay work together in ways other regions do not. Olatz Goitia Urkiaga, who heads the economic development agency BEAZ, explains that Seed Capital Bizkaia, the tax authorities and Lantik—a tech company owned by the Provincial Council—coordinate closely. Lantik gives startups access to advanced infrastructure like quantum technologies, while tax officials design incentives that draw businesses and investors.

A separate agency, Bizkaia Talent, smooths the path for international professionals. It helps them find housing and schools, and even sorts out work permits for their partners. Amaia Jugo, its managing director, says removing these practical hurdles is key to attracting global talent.

Startups solve public problems and spin out from labs

Biscay’s GovTech programme turns public-sector problems into opportunities for startups. Agencies identify challenges and ask whether startups can solve them more effectively, opening the door to government contracts. With 300 companies already in the region, the programme reinforces Biscay’s reputation as a hub for applied innovation.

The concentration of life-sciences research is already producing spin-offs. Protellix, for example, emerged from CIC bioGUNE in October 2026. Other startups are using AI in health: Fisify’s virtual physiotherapist, Aurya, watches patients exercise and gives real-time feedback, while Legit.Health’s platform spots more than 300 skin conditions. In manufacturing, Cocoon Bioscience, Woza Labs and Gloop are gaining traction.

What this means

Lazyfounder analysis — our interpretation, not reported fact.

Biscay proves that regions with deep industrial histories can reinvent themselves as deeptech hubs—if they pair targeted public money with tax breaks, co-investment and talent support. For founders, the model slashes early-stage risk: grants and R&D relief cut costs, while the 40-50% public co-investment makes scaling easier. The I+Med project also signals where demand is growing fastest—biomanufacturing and advanced therapies—so suppliers and partners can plan accordingly.

Key takeaways

• Biscay now hosts 56% of the Basque Country’s life-sciences revenues and 45% of its firms, making it a clear magnet for biotech and medtech startups.
• Startups can access €85,000 in launch grants and R&D tax breaks of up to 70%, sharply lowering the capital needed to get off the ground.
• Seed Capital Bizkaia’s 40-50% co-investment model is unusual: public money actively partners with private investors, reducing dilution and risk.
• The €72 million I+Med bioscience project will create over 600 jobs, pointing to strong demand in biomanufacturing and advanced therapies.

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