In any internationalisation strategy, the choice of anchor territory shapes market access, cost structure and execution speed. It is precisely on these three dimensions that Madrid has built its positioning.
The Madrid Region attracts 72% of all foreign direct investment entering Spain — some €17 billion annually. It is the third wealthiest region in Europe by purchasing power, with a regional GDP that grew by 3% in 2025. Its ecosystem — more than 300 funded startups with an aggregate valuation of $5.4 billion, 29,000 new companies created in 2025, and a regional university funding agreement of €14.8 billion through 2031 makes it one of Europe’s most competitive bases for establishing operations, hiring talent and scaling. N26, the German fintech powerhouse, drew its own conclusions: it chose Madrid not only for its Spanish headquarters, but for its second European operations hub.
First space: the European Union
Madrid is fully embedded in the European single market, with all the regulatory, legal and financial guarantees that entails. For a German company, establishing here does not change the frame of reference.
Second space: Latin America
This is where Madrid’s case takes on a dimension few European capitals can match. Spain is the world’s second largest investor in Latin America, behind only the United States. Madrid is the natural centre of gravity: more than one million Latin American residents live in the city – 14% of its population – creating a pool of bilingual, bicultural talent unique in Europe. The Puentes de Talento programme, recognised by the Inter-American Development Bank as an international best practice, regularly brings Latin American startup founders into the Madrid ecosystem for immersive stays, potential future partners, clients or relays for a German company looking to expand from Mexico City to Buenos Aires.
Third space: North Africa
Less visible, but strategically coherent. Trade between Spain and Morocco reached a record €12 billion in 2023, with Madrid at the epicentre of an economic relationship that continues to deepen. As Morocco positions itself as a logistics and financial hub for sub-Saharan Africa, access to a market of 1.3 billion people through a stable European platform represents a structural advantage that is difficult to replicate from Berlin or Munich.
Few territories in Europe allow companies to address the single market, Latin America and North Africa simultaneously through a single legal and fiscal structure. It is this combination, more than any other argument, that explains Madrid’s trajectory as an investment destination and makes it difficult to ignore for any company thinking at an international scale.