Innovation, at the heart of any advanced economy, has become essential to meet the diversified and rapidly changing demands of consumers. Without it, no new products, services or processes would be possible.

For the canton of Vaud, innovation is all the more strategic because of the strong sectors of its economy, particularly watchmaking, agri-food, catering and hotel industry, real estate, trading and wealth management.

An increasingly important strategic lever

In a competitive environment, participating or not participating in the innovation process is therefore not an option for the Vaud economy. Because, on a global scale, the latter is progressing with or without French-speaking Switzerland. Active participation allows the region to profit from the positive benefits of innovation through the renewal, take-off or implementation of new economic activities. On the other hand, doing nothing means taking the risk of retaining only the destruction of value resulting from innovations driven by others (for example, obsolescence of certain industries or replacement of jobs by algorithms managed elsewhere), which will inevitably occur.

For Switzerland and the canton of Vaud, innovation is all the more strategic because the country has a limited domestic market - even if it is rich and growing - and has no other resource than its grey matter. The country has also seen the gradual erosion of several drivers of economic growth, such as the financial centre and tax attractiveness for foreign companies.

Twenty years of hyper-growth of the innovation ecosystem in Vaud

However, the region has not remained idle: there are 30,000 students and staff at the Ecole polytechnique and the University of Lausanne, and more than 4,000 people employed by 400 companies spread over the canton's seven technology parks. In addition, there is the Centre hospitalier universitaire vaudois (CHUV) with its new Agora oncology research centre (300 researchers), the neighbouring Ludwig Institute (250) and Nestlé's two research centres (250 scientists at the Nestlé Research Centre and 220 at the Nestlé Institute of Health Science). Not to mention the schools of the network of universities of applied sciences in Western Switzerland and, in particular, the ECAL/Ecole cantonale d'art de Lausanne, the Ecole Hôtelière de Lausanne and the Haute école d'ingénierie et de gestion du Canton de Vaud, in Yverdon-les-Bains.

The size of the canton's university research system has almost doubled since the 2000s


There are also incubators such as that of the EHL, co-working spaces oriented towards innovation that have recently appeared, such as Gotham in Lausanne or UniverCité in Renens, which hosts the MassChallenge start-up accelerator.

« However, the region has not remained idle »

The canton, land of deeptech

In recent years, the canton of Vaud has built or expanded research and entrepreneurial infrastructures that are now reaching a remarkable size. This highly scientific and technological infrastructure influences an important feature of the innovation ecosystem in Vaud: it is specialized in deeptech, in other words technologies with a high scientific content.

Switzerland is one of the top 10 countries in terms of science-based societies

These technology-intensive economic sectors are beginning to make a significant contribution to the canton's GDP, and their share has been growing for several decades. They are mainly carried by large groups and SMEs. But, over the past twenty years, a new business model centred on innovation has gradually emerged: that of start-ups.

«A new business model centred on innovation has gradually emerged: that of start-ups»

Start-ups, drivers of the innovation ecosystem in Vaud

In the canton of Vaud, this phenomenon has become so widespread in recent years that one is tempted to speak of a "start-up canton" by analogy with the Israeli "start-up nation".

According to the Swiss Venture Capital Report, start-ups in Vaud attracted CHF 267.5 million in 2018 (CHF 298.3 million in 2017 and CHF 461.7 million in 2016). Depending on the year, Vaud is either the first cantonal destination for financing start-ups or the second after Zurich.

Critical size, a determining factor for an ecosystem

Although regional or urban start-up ecosystem rankings tend to be lower in relation to the country’s overall results, they are beginning to reflect this dynamism of the Waldesian ecosystem. The 2018 ranking on the attractiveness of StartupBlink's start-up ecosystems by city has thus increased Lausanne from 192nd to 78th place out of 1,000. Startup Genome's Global Start-up Ecosystem Report 2019 included, for the first time, the Lausanne-Berne-Geneva region in its top 30 worldwide. Even more concrete signals: a number of Vaud start-ups are reaching respectable sizes in terms of both turnover and number of employees, such as Frontiers Media with more than 500 jobs, half of them in Switzerland, Nexthink with nearly 400 jobs, more than a third of them in Switzerland or Sophia Genetics with more than 200 jobs, half of them in Switzerland according to statistics published by the Scale Up Vaud initiative for 2019.

The determining factor for this promising dynamic to take place is the achievement of a critical size. The innovation ecosystem of the Lake Geneva region and the canton of Vaud has made considerable progress in this direction in recent years. And it's starting to show.

«We need to innovate and invest in tomorrow's products»