MOST ATTRACTIVE SECTORS FOR INVESTMENT IN SPAIN

Accelerate your business with these expert tips on "The most attractive sectors to invest in Spain". Analyse and discover this TIP!

Spain offers great business opportunities in growth sectors: environment, new technologies, automotive, aeronautics, pharmaceuticals, healthcare, chemicals, biotechnology, etc. For example, Spain is the third most attractive European country to invest in real estate.

In recent decades, foreign investment has been a determining factor in Spain's economic development. Italy, the United States, France and Germany are the main investors in Spain.

Why invest in Spain?

Despite the crisis, Spain is a competitive country with great potential for growth. Its benevolent climate compared to the rest of Europe is in itself an opportunity for some sectors such as tourism and renewables. Also, its magnificent geostrategic location, which provides quick access to the rest of Europe and North Africa. Spain is also an excellent bridge to Latin America, a region with which it maintains a very intense economic relationship. 

Spain's domestic market is made up of 47 million consumers, and this is expanded by the arrival of 68 million international tourists each year, as Spain has an excellent communications and infrastructure network.

Another important factor is its relative legal, social and economic stability. Spain is a country with a democratic constitution that provides political, economic and social stability. This is an important incentive for foreign investment.

On the other hand, Spain offers important opportunities, as it is currently developing a strategy to change its production model by incorporating activities with higher added value, promoting internationalisation and innovation and R&D.

Foreign investment in Spain is encouraged by a series of support measures provided by organisations such as ICEX, tax incentives and support for "landing" in our country in the case of foreign companies that want to set up subsidiaries in Spain.

Here is a list of the economic sectors of greatest interest for investment in Spain:

ICT SECTOR

According to Marca España, Our country is an attractive place to invest in this sector, which has seen strong growth in recent years. According to their data, this sector accounts for 5.7% ofl gross value added of GDP, employs more than 440,000 people and has a turnover of more than 101 billion euros.

The most interesting activities within the ICT sector are:

• SOFTWARE

  • It is the leading sector at the moment and also the favourite of investors, who do not want to miss out on the new Google or Salesforce.
  • Most of the business angels (+) has software companies in its portfolios (specifically 56%), according to AEBAN data. And IT is also one of the favourite sectors of the funds of venture capital (+). 
  • Investment in information technologies amounted to 116 million in 2018, 63% more than a year earlier. IT companies were especially popular with international funds, accounting for 86% of their investments, according to ASCRI data.
  • Among other things, the advantages offered by the software industry are the scalability (+) in sales and the potential for internationalisation (+) at minimal cost. This is thanks to cloud technology.
  • Of particular relevance are the so-called SaaS, Software as a service. These are companies that offer IT solutions in the cloud, which means that the customer does not have to install them.

• ARTIFICIAL INTELLIGENCE (+)

  • It is a revolutionary technology that will change the economy as we understand it today. It brings important advances for other sectors such as retail, law, education, human resources, etc. The startup (+) robotics are transforming sectors such as industry and medicine.
  • Investors are aware of the potential of these companies. Thus, the Basque company Sherpa raised €7.5 million last January and is negotiating another round of around €17 million, while the Catalan company Inbenta raised €6 million less than a year ago.

• BIG DATA (+)

  • Data is the raw material of the 21st century. But its potential depends on the ability to collect, analyse and apply it.
  • Big data companies are one of today's trends. A market niche (+) to be exploited is that of open data, which is generated by companies and public institutions and is freely accessible.
  • Related to big data is the Internet of Things (IoT). This technology allows certain devices to accumulate information and transmit it to a support centre in the cloud, where big data analysis, combined with artificial intelligence, allows conclusions to be drawn and solutions to be provided.
  • This field includes everything from wearable companies such as Geeksme, to companies linked to the automotive industry, such as Boonder.
  • Another growing sector is machine learning, which aims to enable artificial intelligence systems to learn from data, identify patterns and make decisions with minimal human intervention.

• HEALTH AND HEALTH SECTOR

  • According to Marca España, "the biotechnology sector concentrates more than 3,000 companies, employs 202,250 workers and has a turnover of more than 53,152 million euros". Let's take a closer look at the options offered by this sector.
  • Startups that innovate in the field of healthcare are taking off in Spain. In view of what has happened in the United States, experts predict that eHealth will be the fastest growing start-up segment in the coming years. 

The principle of the four P's now prevails in the provision of health services:

• Participatory.
• Personalised.
• Predictive.
• Preventive. 

• • This will be achieved through the confluence of technologies such as big data, IoT and artificial intelligence, not forgetting the latest advances in genetics.
  • Femtech, meanwhile, is in full swing in the United States and is expected to boom in Spain.
  • Fertility and medical advice apps, such as the Spanish WOOM and B-WOM, as well as technology-based healthcare products and services companies are real manifestations of this trend, which, according to experts, will be worth some 55 billion dollars.

• AGROTECH AND FOODTECH

  • Technology also generates important opportunities in a sector as important as agriculture and food in Spain.
  • Companies in these sectors have the highest growth potential.
  • Current examples of such companies already operating in Spain are AgroMapping which uses satellite technologies to monitor crops. AgroPestAlert monitors pests through the Internet of Things.
  • Meanwhile, foodtech trends include the use of delivery robots, home delivery services and healthy eating.
  • Delivery companies had a turnover of more than one billion euros in 2018 in Spain. Glovo is a magnificent example of the prominence that this type of company is taking in Spain. 

• FINTECH (+) E INSURTECH

  • The financial services sector is also undergoing a technological revolution in Spain, where there are 400 registered companies, making it the country with the most fintech companies per capita. 
  • Despite this, it still offers great potential for entrepreneurs. It is one of the favourite activities of business angels.
  • This is because of the different opportunities it offers, from data analytics to transactions. It is a large and growing pie.

• PROPTECH

  • These are companies that use technology to optimise activities in the real estate sector. Since 2014, when the sector hit rock bottom due to the crisis, venture capital investments in these companies have been growing steadily. 
  • The most prominent business lines are digital real estate companies such as Housefy, Housell, Cliventa, Clicpiso or propertista. Badi, a leading Catalan company in the sector, has closed a financing round of 26 million. 
  • The rental market, too, offers opportunities, as does real estate valuation, which uses big data and artificial intelligence to develop its services. The interest of the appraisal sector is evidenced by BBVA's purchase of Madiva Soluciones.
  • Real estate financing also has its options. Hosers or Inveslar are two examples of the application of crowfunding (+) in the construction sector.

• CONSUMER AND RETAIL

  • The production and sale of consumer products is the star activity of entrepreneurs in Spain, accounting for 50% of investments by venture capital funds.
  • In addition, 21% of Spanish business angels have this type of investment in their portfolios.
  • However, the sector is undergoing a transformation that cannot go unnoticed.
  • On the one hand, the rise of the e-commerce (+) is unstoppable, as evidenced by the growth figures recorded in recent years. As a result, there are major opportunities in the logistics sector.

Thirdly, new business models (+), such as digital native brands, companies that design, manufacture and distribute their products on the Internet.

• TRANSPORT

  • The rise of collaborative consumption has opened the door to all kinds of new transport solutions. This is a thriving field for entrepreneurs, as the success of Cabify and Movo proves.
  • However, it is important to remember that it also presents some risks, particularly in regulatory matters.

• AERONAUTICS SECTOR

  • Also, according to data from Marca España, "the Spanish aeronautics industry is the 5th largest in Europe in terms of turnover and employs more than 37,000 workers.
  • Particularly important in this sector is its very high percentage of R&D expenditure.

• AUTOMOTIVE AND COMPONENTS SECTOR

  • This is already a classic sector. For decades, Spain has had a good number of world-renowned plants where vehicles and their components are manufactured.
  • Not in vain does it account for 10% of Spanish GDP and brands such as General Motors, Volkswagen and Renault, among others, rely on our factories. However, although it is a sector that deserves to be mentioned, it is a mature sector.

• CONSTRUCTION SECTOR, SECOND RESIDENTIAL HOUSING

  • Although it may seem paradoxical, for foreign investment, our country is an excellent option for investing in "bricks and mortar".
  • With the drop in real estate prices, both in coastal and inland areas, the sector has become very attractive for residents from other countries, who are attracted not only by the climate, the coast and the gastronomy, but also by the competitive prices in relation to their purchasing power.

• FASHION SECTOR

  • With large flagships such as the Inditex group, Mango or the important footwear sector, its economic weight in the Spanish GDP is close to 3%, employing more than 4% of the population and reaching almost 10% of Spanish exports.
  • Moreover, this mature sector is experiencing a new honeymoon thanks to the e-commercewith double-digit sales growth exceeding 50 and 60% in recent years.

• TOURISM SECTOR

  • In 2015 it broke all records once again and has become one of the key strategic sectors in our country.
  • A total of 68.1 million foreigners visited Spain in 2015, an all-time high, representing a 4.9% increase over the previous year.
  • The main countries of residence of tourists visiting Spain last year were the United Kingdom, France and Germany.