PUBLISHED July 10th, 2025 12:49 am | UPDATED August 6th, 2025 06:03 am
In 2025, Portugal stands at a crossroads, celebrated for its booming startup scene and investor-friendly climate, yet grappling with rising housing costs, immigration pressures, and shifting public sentiment. The SIM Conference in Porto showcased the country’s innovation momentum, while updated citizenship laws and evolving crypto tax rules signal a nation redefining its openness.
For digital nomads and founders, Portugal remains enticing, but the dream now comes with bureaucratic hurdles and social tensions. As economic ambition meets the realities of local displacement and political recalibration, Portugal offers both a compelling opportunity and a cautionary tale for those eyeing Europe’s western frontier.
SIM – Startup, Investment & Matching Conference
Back in early May, we visited the historic Alfândega Congress Center in Porto and it was pulsing with entrepreneurial energy. It was the inaugural edition of SIM – the Startup, Investment, and Matching Conference, and by all accounts, it made waves. Over 3500 participants, including 400 startups, 230 investors, and 190 speakers, gathered for an agenda that was as ambitious as it was curated.
More than just another tech gathering, SIM is a platform where business cards were traded with intent and ideas pitched with passion. With tracks focused on Fintech, Health Tech, Smart Manufacturing, Sustainability, and AI, the event carved out serious credibility as a launchpad for innovation. Startups got full-access passes, Showcase Area slots, and face-time with investors via pitch competitions and matchmaking sessions. On the other side, investors were matched with high-potential startups aligned with their portfolios, backed by bespoke support from the SIM team.
In Porto, innovation felt intimate and human. It wasn’t about unicorns and valuations for the sake of buzz, but about building something meaningful. Which, in many ways, mirrors what Portugal has been quietly doing on the global stage.
An Ecosystem in Motion
Fast forward to the national picture, and Portugal’s momentum is unmistakable. As of November 2024, the country boasts 4,719 startups and a 16% annual growth rate over the last year. The density of innovation is no accident, rather it’s the result of strategy, infrastructure, and political will.
Portugal is nurturing quality, not just quantity. There are 40 unicorns operating locally, with six proudly carrying Portuguese DNA. Remarkably, 58% of startup revenue comes from exports, proving that this small country is thinking globally from day one.
Trust in the system is reflected in investment figures. The ecosystem features 52 fund management companies handling 135 funds, including 11 that exceed €100 million. And for startups? The average wage hovers around €2,000, which, while modest by international standards, is a competitive rate in Southern Europe.
Flagship ventures like Bhout, the smart boxing bag that raised a record €10M seed round, and Sound Particles, which made it to the Academy Awards, demonstrate Portugal’s creative edge. Smartex, with its AI-driven textile manufacturing solutions, shows how deep tech can transform even the most traditional sectors.
Backing all of this is robust policy support: from Startup and Tech Visas, to a One Stop Shop that has facilitated over 7,000 international connections across 110 countries, and series of regular community events such as the Above & Beyond Hangouts, by Startup Portugal, which drives cross-country collaboration. Portugal isn’t just startup-friendly; it’s startup-ready.
Living the Dream, or Rethinking It?
But for all the buzz and growth, real life on the ground tells a more complex story. Portugal has long been a favourite for digital nomads and expats, with its sunny skies, great food, fast internet, and affordable living made it feel like Europe’s best-kept secret. Not anymore. The influx of remote workers and investors has sent rental prices skyrocketing, especially in Lisbon and Porto, where one-bedroom apartments can now exceed €1,500 per month. The Golden Visa no longer offers the perks it once did, with property investment routes restricted, and even the once-streamlined D7 and D8 visa processes have become bureaucratically slow.
For locals, the gentrification wave has become hard to ignore. Wages haven’t kept up, and many feel squeezed out of their own neighbourhoods. The contrast is stark. While expats work from beachfront cafes, Portuguese families struggle to afford housing. Frustrations have spilled into protests, and resentment is growing. In the public eye, digital nomads are no longer harmless freelancers, they’re part of the displacement puzzle.
For newcomers still eyeing Portugal, smaller cities like Braga and Coimbra offer lower costs but lack the expat infrastructure of Lisbon. And while coastal escapes like Madeira or the Azores sound idyllic, they come with logistical and travel challenges and price tags to match.
Integration now demands more than a laptop and a visa. Expect to register for a tax number (NIF), healthcare ID, private insurance, and navigate a maze of tax implications, seemingly outdated processes and long waiting times. But for those who do their homework and embrace Portugal on its terms, the reward remains: a vibrant, beautiful place to live and create.
Portugal and Capital Gains Tax: Still a Long-Term Win for Crypto Holders
Portugal’s pull isn’t just for founders or sunseekers. For years it has topped “zero-crypto-tax” lists, drawing a steady flow of remote workers and digital-asset investors. Capital gains on coins held longer than 365 days remain exempt, making Portugal one of Europe’s most forgiving jurisdictions for long-horizon crypto holders. Those who secured Non-Habitual Resident (NHR) status before the 31 March 2025 cutoff enjoy an even sweeter deal. Most foreign-source crypto income escapes tax altogether, while domestic income is capped at a 20 percent flat rate.
But the small print is growing bolder. Short-term crypto gains (under a year) now face a 28 percent levy, and earnings from staking or business-like activity are taxable too. In practice, Portugal is still a magnet for crypto expats, but the window is narrowing, and the bureaucracy has caught up with the buzz. For newcomers, the lesson echoes other parts of Portugal’s story: arrive informed, budget for the paperwork, and recognise that even paradise keeps revising the rulebook.
How Emigration and Public Opinion Are Shaping National Policy
Once hailed as one of Europe’s most open countries for newcomers, Portugal is now rethinking its approach to immigration. Amid record-high arrivals and growing public unease, the newly elected conservative coalition is introducing stricter residency requirements for citizenship, a move that signals a shift toward policies more in line with mounting domestic concerns.
Under the draft law presented on 24 June 2025, the standard residency requirement will rise from six to ten years, while applicants from the Community of Portuguese Language Countries (CPLP), will still be able to apply after seven years. The shift comes as immigration dominates public debate:
- 68% of Portuguese adults now say the country’s immigration rules are “too permissive,” according to the Immigration Barometer published by the Fundação Francisco Manuel dos Santos in December 2024.
- A Gallup International / Intercampus survey released in February 2025 found that only 39% of respondents favour further immigration, while 30% are explicitly opposed.
- Concern has grown in parallel with record inflows: official data shows more than one million foreign residents in 2023, a 130% jump from the previous year, and the largest increase ever recorded. More recent data puts the current number of immigrants living in Portugal at no less than 1.6 million.
Against that backdrop, the tougher citizenship timetable is widely read as the government’s first substantive answer to voters who feel the system was moving faster than society could absorb.
Conclusion: A Nation in Balance
Portugal in 2025 is a study in contrasts. The nation finds itself being a thriving innovation ecosystem, a welcoming investor environment, and a society negotiating the cost of progress. The SIM conference reflected a forward-looking spirit: one that welcomes risk, builds networks, and dares to lead Europe’s tech future. Meanwhile, the streets of Lisbon and Porto are reckoning with the side effects of success.
The country’s challenge now lies in balance. How does it remain attractive to investors and founders without alienating its citizens? How can growth benefit everyone, not just the venture-backed few? How can citizenship policy reflect both national values and global realities? How might Portugal redefine openness in a time of growing political and economic strain?
As the world rethinks how and where we build the future, Portugal is a compelling case study. It offers sunshine and substance, regulatory policy environment and people, ambition and authenticity. For the startup crowd, it may be Europe’s next big thing. For the rest of us, it’s a reminder that paradise comes with paperwork, and responsibilities.