Global founders weigh opportunities and obstacles as Taiwan climbs to No. 2 in entrepreneurship ranking

Taiwan was ranked the world’s second-best environment for entrepreneurship, but the lived experiences of founders — from European and African serial entrepreneurs to local social innovators — reveal a startup ecosystem that is both fertile and imperfect.

A global vote of confidence for Taiwan’s startup ecosystem

Taiwan has emerged as one of the world’s most favorable places to start a business, according to the latest report by the Global Entrepreneurship Monitor (GEM).

In the organization’s 2025–2026 Global Report, Taiwan ranked second worldwide in the National Entrepreneurial Context Index (NECI) among 53 economies, trailing only the United Arab Emirates (UAE).

The island scored 6.5, an improvement from 6.3 the previous year, reflecting strong performance across key indicators including, infrastructure, policy support, and social norms.

Saudi Arabia, Lithuania, and India rounded out the top five, while major economies such as Japan, the United States, and Germany ranked 17th, 20th, and 24th, respectively.

The index evaluates the broader framework conditions that shape entrepreneurship, including government policy, access to financing, education, infrastructure, and cultural support for business creation. In several of these dimensions, Taiwan scored particularly well.

Taiwan's Ministry of Economic Affairs said in a press release that the island’s strengths lie in efficient government policies, robust infrastructure, and a dense ecosystem of professional services that support startups, ranging from accelerators to research institutions.

Taiwan was also one of only four economies globally to receive an “excellent” rating in both sustainability prioritization and entrepreneurial awareness of AI applications, alongside the UAE, Norway and Sweden.

Yet behind these statistics are the lived experiences of Taiwan-based entrepreneurs — many of them foreigners — who have actually built companies on the island.

A hardware powerhouse with top tier talents and longer startup runway

A Swedish entrepreneur, angel investor, author, and Hult Prize mentor named Elias shared with TCN what he sees as Taiwan’s strengths and weaknesses when it comes to the entrepreneurial environment.

A serial founder whose entrepreneurial journey began from his teenage years when he tried launching a radio station, his ventures ranged from, among others, an e-commerce company in the United States established in the late 1990s and an online portal in Taiwan launched in the year 2000. He now runs a Taipei-based consulting firm helping companies solve sales and marketing challenges.

“The advantage here,” he told TCN, “is that specific sectors are extremely strong,” pointing to hardware, bicycles and machinery. He added that “the workforce is highly educated.”

Taiwan’s industrial clusters and engineering talent have long made it a global manufacturing hub, a foundation that gives startups an advantage, Elias stated.

Equally important are the practical economics of life on the island.

“The cost of living is lower, and you don’t need as much capital to start,” he noted. “That gives startups a longer runway, meaning they can survive longer before their cash runs out.”

But the ecosystem is not without friction. Elias pointed to a strict regulatory framework and the absence of widely used startup financing instruments such as SAFE notes.

Foreign investment can also be complicated, he said, citing tax burdens and rigorous regulatory scrutiny when overseas capital flows into Taiwanese entities. He added that he understands and agrees with the goal of avoiding suspicious foreign fund to flow into the island.

Lessons from a South African serial entrepreneur

For Andrew, a South African serial entrepreneur now running a healthcare startup in Taiwan, the path to business began decades ago in an unlikely place: a strawberry farm.

While studying forestry in South Africa, he once transported surplus strawberries to tourists visiting from Europe. After tasting the fruit, one traveler — whose father was a distributor — helped Andrew eventually export the strawberries to Europe after several failed attempts.

The episode left him with a lasting lesson. “It taught me the importance of networking,” Andrew told TCN. “And that entrepreneurship must always start from market demand, not just from your own ideas.”

Years of trial and error also sharpened his instincts as a founder. “After you’ve started companies before, you learn to recognize when something isn’t working — and pivot faster.”

Andrew said that there are indeed numbers to support decisions to start businesses in Taiwan, such as the island’s performance in hardware manufacturing and status as one of the world’s top 20 economies.

However, he highlighted, there are numerous drawbacks and the experience can be arduous especially for foreign founders.

“Visa restrictions and bureaucracy make things difficult,” he said. Opening bank accounts or establishing companies often involves layers of paperwork.

Andrew, who has helped many foreigners obtain the Taiwan Entrepreneur Visa, says expectations do not always match reality. “Many people arrive impressed by Taiwan’s economic performance,” he said. “But once they experience the system, the dropout rate among foreign entrepreneurs is surprisingly high.”

A locally-trained and internationally recognized social entrepreneur

Among Taiwan’s most prominent young founders is Anny Chang (張希慈), a graduate from National Taiwan University and a social entrepreneur recognized on Forbes' 30 Under 30 list.

Chang founded City Wanderer and later the Well Planet Foundation, organizations focused on experiential learning, youth empowerment, self-exploration and the well-being of caregivers and helping professionals.

Having lived and worked overseas, she sees Taiwan as an unusually supportive environment for social entrepreneurship, a niche often overlooked elsewhere.

Government initiatives, she told TCN, ranging from social innovation databases to dedicated incubator spaces have created a dense network of support. Multiple ministries — including those overseeing education, digital affairs, health and economic development — provide programs and funding.

“Taiwan’s policies strongly encourage entrepreneurship,” Chang noted. “They are constantly being revised and improved.”

The island is also relatively welcoming to women founders, with targeted programs and resources designed to support female entrepreneurship.

But Chang believes Taiwan’s startup ecosystem still faces structural limitations. One challenge is visibility.

“Many government programs exist,” she said, “but the communication isn’t always effective, so the right people sometimes do not know about them.”

Another constraint is international connectivity. Taiwan’s geopolitical position and language barriers can make global collaboration more difficult, particularly compared with startup networks in Southeast Asia, she stated, adding that operating in Taiwan can feel somewhat isolated from the international community.

Other opportunities and frictions

A French entrepreneur whose Taiwan-based company focuses on international trade, requesting to speak on condition of anonymity for privacy concerns, offered his insights and perspectives.

Taiwanese firms, he said, often display an outward-looking mindset. Having lived and worked in both Mainland China and Taiwan, he compared his own experience in these two places.

“Many companies here are overseas-oriented, targeting markets across China, Southeast Asia and the Asia-Pacific rather than relying solely on domestic demand, which is what many Chinese companies tend to do.”

As for the challenges, he said that traditional business practices still linger in some sectors. “Companies that operate only in Taiwan sometimes follow older methods that can be difficult to deal with,” he said, occasionally even involving actors from gray-area business networks.

A promising but evolving ecosystem

Taken together, the perspectives illustrate the dual reality of Taiwan’s startup environment.

On paper, global rankings portray a flourishing ecosystem supported by strong institutions, advanced infrastructure, and pro-entrepreneurship policies.

In practice, founders encounter a more nuanced landscape — rich in opportunity, but still navigating bureaucratic hurdles and limited international integration.

Yet with its world-class manufacturing capabilities, a highly educated workforce, and an increasingly supportive policy framework, Taiwan remains a place where ideas can take root for many entrepreneurs.