Top Trends in Balkan Startup Scene
We’ve just concluded the first ever SEE Growth Bootcamp organized in partnership with Microsoft. Having worked with startup founders from Croatia, Slovenia, Bosnia and Herzegovina, Macedonia, Kosovo, Albania, and scouted for startups even wider, here are some of the trends we noticed along the way.
From what we have seen, the region overall is still on an early stage, but there are more and more programs to foster entrepreneurship.
We believe we are going to see at least a 5-fold growth of early stage startups. As one of our mentors Thomas Kösters from EIT Digital said after the event “we have been working in the region for years and feel a tipping point coming”.
In a way South East Europe (SEE) aka Balkan countries remind of the Baltic region around 2012 in terms of maturity of first time founders, business angel activity level etc. But SEE also has significant advantages, if you compare to the Baltics then, as the number of people in the market is way bigger, there are already established regional VCs like South Central Ventures, and having a large diaspora in US and UK might help entering those markets faster.
There’s clearly a lot of technical talent in the region, however, not that many deep tech startups.
Might be due to many large companies outsourcing to the region and employing tech talent. We do hope to see talented people going on entrepreneurial journey and building strong deep-tech and also blockchain startups in near future.
While there’s lots of startup activity in Serbia and Croatia, we would not be surprised to see next promising startups coming from Macedonia or Kosovo.
During Bootcamp we already worked with 3 teams from these countries — Qpick, Labbox, Fafi-ks.com — that showed great ambition, positive energy and focus. There are fewer large companies and investors, but the level of “hunger” for success might lead more young people in the entrepreneurship early on. This has been a very similar trend some years ago in Estonia and neighboring countries and we are excited to keep working with Balkan startups to see, what’s next.
However, on the flip side, there are of course areas for improvement and here are some of our tips for Balkan startups.
Most early stage startups are way too focused on home region.
If compared to the Baltics, thinking global from day one has brought around some unicorns (think Transferwise for example). Of course there is a logic behind it as Serbia alone has more inhabitants than all 3 Baltic countries together, so initial focus on Balkans might make sense especially for B2C companies. However, we think that more international and global mindset would help startups scale faster.
Very few entrepreneurs in the region have raised money from angel investors or VCs.
It is mostly due to the lack of availability of Angel Investment. However, EU money and regional grants levels it out for a short-term survival strategy, but cannot be considered fundraising. For a longer term success and scaling, startups need to be well trained and aware on how to lead negotiations with investors, how to prepare their company to be investable and what to expect once a larger investor joins.
Pitching is still a weakness.
It is not the English as some might think, but rather a lack of practice and understanding of the audience.
Many startups think that pitch is something you prepare for investors, but actually you do “sell” your startup every day — to your employees, business partners, loved ones. One of Startup Wise Guys alumni got an investor after a random conversation on a flight to give you an idea.
And the recipe for success is simple — leverage every opportunity to pitch and practice, and always keep in mind — what is the thing you want people to remember or do after.
We have seen quite a boom of Serbian and Croatian startups applying also to our accelerator based in the Baltics, but so far none of them have made it to the finals, mostly indicating too early stage or technological immaturity. We are for sure looking forward to the Balkan startup power and curious, if the next Startup Wise Guys B2B or Fintech accelerator would have a team from this region!
SEE Growth Bootcamp hosted 11 selected and hand-picked startups for a 3 day bootcamp dedicated to preparations for scaling and fundraising. The selected teams were: VRET, Bindwise, Little Dot, Scepter, Qpick, Unitfly, Labbox, Pontibus, Recogno Ltd., Fafi-ks.com and Xplorify.
Bootcamp was organized by Startup Wise Guys in partnership with Microsoft, hosted by Technology park in Zagreb and supported by ICT Hub, ABC Accelerator, South Central Ventures, EIT Digital and Development Agency of Zagreb.
