Switzerland can officially boast the worlds fastest growing venture capital (VC) ecosystem, with only Dubai and Singapore preventing Austria from making it a DACH double at the top. An exciting tech sector has undoubtedly contributed to these impressive regional rankings, but those at the heart of both ecosystems have slightly differing views on how sustainable the growth is.Pitchbooks annual Global venture capital ecosystem rankings for 2024 revealed the perhaps surprising ascent of Austria and especially Switzerland. Despite both countries sitting much further down the broader development scores, the country growth index framed both countries among the top tier, with Switzerland at the summit.At first glance, the news reflects a concerted period of success for startups and scaleups in the DACH region, which would seem to bode well for the future too.Yet growth is relative. And regardless of the positive grounding and traits that both share, there are differing opinions on whether this growth will now drive Switzerland and Austria to the top of the VC Development rankings as more entrenched and embedded powerhouses.Switzerland and Austria have fostered thriving startup ecosystems, largely thanks to their strong academic hubs, such as ETH Zurich, says Markus Gleim, principal at renowned global VC fund Northzone.These institutions have a consistent track record of producing top-tier talent and cutting-edge spin-outs such as AI innovators LogicStar. And, as a result, both nations have been able to carve out strong niches in deep technological sectors like medtech and cleantech.However, while signs of growth have been promising, to sustain this momentum both regions will need to create an environment that allows their emerging cohort of startups to become stable, high-growth companies.Addressing late-stage funding gaps and leveraging cross-border partnerships within the DACH region will help startups scale internationally. Even closer collaborations between universities and industry will also help prolong the growth of these startup hubs, he adds.Gleims vision for that transition from scaleup to global, high-growth company can, in part, be remedied through these more practical, collaborative steps. However, Felix Ohswald, CEO and co-founder at education gamechanger GoStudent, believes there is also a mindset element to address.To this end, he poses that the success of GoStudent itself has partially contributed to an outlier period which has launched the companys native Austria towards the top of the VC growth rankings.I was a bit surprised when I read that Austria is one of the fastest growing countries in this context, he says. It needs to be understood in terms of your starting size, so when you then have some very big financing rounds for companies in a smaller ecosystem, the relative growth is proportionally higher. You can also then see this doesnt equate to the wider development scores. The 2018-2024 period has been a bit of an outlier.Ohswald is quick to emphasise that this isnt to undermine the success of companies that have risen to prominence during this period, or even to downplay the success of the regional VC ecosystem in capitalising on these opportunities. His only concern is that the default DACH mindset may now prevent the region from leveraging these successes and to demand more sustainable competitiveness.These past few years in both Austria and Switzerland it has been proved how many great people, ideas and companies there are in these environments, he adds. But that just means we can grow and ignite more of these companies more frequently. It all starts with the drive and mindset.This needs to come from the very top, with country leaders who are proud to not only support and spark new companies, but to push them to be the best globally.This is independent of socio-economic circumstances and, even to an extent, from the leading academic frameworks we have here, Ohswald adds. Mindset means having something in you to build better, faster. Less red tape and bureaucracy can certainly help to then speed things up, and why not elevate our education institutions even further?What this ranking shows, if nothing else, is that we have all the ingredients here to be the best. So, lets not be shy in aiming for that. Not everybody has to be good at everything. The mindset shift Id be looking for is to promote an elite ecosystem that encourages the best minds here, that pushes the best to the top, and that then has all those favourable conditions to push these cool ideas out to the world to benefit as many people as possible.While everyone is keen to capitalise on recent growth, there are some within the DACH ecosystem who foresaw this golden age long before. In particular, Andre Retterath, partner at Earlybird Venture Capital, predicted a European-wide purple patch driven by talent, collaboration, funding, success stories and interestingly mindset.The rankings and Switzerland being at the top in particular, came as no real surprise to me, he says. I completely agree with the relativity element as they both have small denominators in terms of funding, against a situation where lots of big funding then came into the country.What doesnt surprise me, however, is that the money did come. The region houses so much great research, access to industry and especially big tech, and is in close proximity to ecosystems in Germany, France and the UK. The only surprise is that so little funding came into the ecosystem before.Retterath has comprehensively explored and dissected the notion of ecosystems, and deduces that a successful golden age relies on different components coming together in harmony: Smart minds, seamless business formulation, and a collaborative environment.Beyond these factors, hes also keen not to compare countries such as Switzerland and Austria to the likes of Dubai and Singapore, who split the two DACH entries in Pitchbooks Growth scores.The other element a successful VC ecosystem needs is its own personality, he affirms. What makes us great? Look at ETH Zurich or EPFL, the Swiss Federal Technology Institute of Lausanne. These are top academic institutions. Then look at the regions history with big tech, or with finance, or medtech. Look at their socio-economic groundings. Its a great place to live or to relocate to very clean, neutral, highly ambitious.To me, the strength of the DACH VC ecosystem is the DACH region itself. Its own personality and capabilities. Singapore and Dubai are great for their own reasons, but Id say our fundamentals are as naturally suited to startup success and VC activity, as any.The potential of DACHs VC ecosystem is doubtless. From those within and those looking in, the only disagreement is around whether the recent ascent in the global context was inevitable or not. For some, like Gleim and Ohswald, recent success stories are a sign of what could be, but are in danger of remaining outliers if both Austria and Switzerland dont actively strive to convert growth into longer-term development.For others, DACH has been a sleeping giant, with its tech prowess and VC support finally combining to put Austria and Switzerland in the global consciousness.Alan Poensgen, partner at Antler, a global VC fund targeting zero day investments, concludes: Both the Swiss and Austrian ecosystems have always been promising, yet, historically, many successful founders left once their startups reached a certain stage other ecosystems with proximity to larger pools of talent or capital were too attractive.Lately, weve seen the flywheel in both ecosystems begin to spin faster: more innovation, more exits, more liquidity, human capital moving through, Zurich outperforming even Cambridge when it comes to unicorn founders.Regardless of what the future has in store, everyone agrees that there is reason to be excited right now. All the ingredients are there. The question is, has the golden age only just begun?Read more about tech innovation in Austria and Switzerland