This country could be the next fin-tech hot spot

When it comes to expansion for fin-tech companies in Europe, all roads lead to Luxembourg. Having recently expanded our operations into this country, we have found it to be an ideal business center.

First, Luxembourg is the Silicon Valley of Europe. It is home to the European branches of PayPal, Amazon, Microsoft, eBay and others.

City of Luxembourg.
Richard Elliot | Getty Images
City of Luxembourg.

One major advantage of Luxembourg over California is the strength of its financial sector. Luxembourg is the No. 1 investment-fund center in Europe (second worldwide behind the U.S.), and No. 1 for listing international bonds in Europe.

Another advantage of Luxembourg over California is the absence of unbearable traffic and enormous housing costs. When you're in Luxembourg, you can get around much faster and live less expensively than in the San Francisco Bay Area.

Luxembourg has one of the largest concentrations of top-notch data centers. It's home to 20 percent of all European Tier IV data centers — the highest mark possible — according to Uptime Institute, which measures the efficiency and reliability of business-critical infrastructure. Two-thirds of Luxembourg's data centers are Tier IV, which means when you choose hosting in Luxembourg, you're very likely to have the most reliable hosting on market.

On top of that, it is inexpensive. Luxembourg has the most available power in Europe (six times fewer power outages than in the UK or France), at one of the lowest costs. This means your data-center provider spends less to give you more.

The Luxembourg government is also very business-friendly. It makes a persistent effort to attract financial and IT companies.

A recently adopted E-Archiving Act has enabled all legal actions to be carried out using electronic versions of documents instead of paper ones, which shows Luxembourg is committed to shifting to a digital economy. Luxembourg has special procedure allowing customers to retrieve data from a company that went bankrupt — something not many countries can account for.

Luxembourg Prime Minister Xavier Bettel has also called out fin-tech specifically.

"Fin-tech holds huge promises for innovation and growth in Luxembourg," Bettel said while visiting software company Ripple Labs.

Luxembourg is located in the geographical center of Europe; 60 percent of European GDP is reachable within a one-hour flight. On top of that, it is on the crossroad of two major continental cultures. Luxembourgers speak German and French, the languages of the two largest countries in Europe.

Luxembourg is a mini-version of a global melting pot: 46 percent of the population (and 71 percent of the workforce) are non-nationals, making Luxembourg the EU's most "international" country.

Nikolay (Nick) Dvas is COO of, which is aimed at bringing enterprise-grade hosting to small- and medium-sized businesses. Nick has been working in the hosting industry since 2010, and joined XBT Holding, now the parent company of, in 2013.