Category Archives: Romania

Romania has potential to become tech startup hub

Although Romania is one of the poorest countries in the EU, it has good chances to become the new continental hub for technology startups. Thanks to its unique culture, history, educational system and telecommunications infrastructure, the country has created a generation of entrepreneurs in technology industry who hope that Bucharest will become the new European startup capital.

Romania has been a member of the EU since 2007 and is now the second fastest growing economy in Europe. Well educated in the field of new technology talent base, low wages and operating costs make it an attractive location for international companies planning to use outsourcing. However, Romania also stresses its own technological startups, especially those whose development seems to be relatively cheap. The niche has been growing rapidly for 5 years and currently concentrates already about 170 startups. One of these startups is the company Accelerole, which is a branch of the global co-working platform TechHub. Romanian company gathers already about 100 technological freelancers and entrepreneurs.

Paradoxically, the technological boom has occurred thanks to some communist heritage. The previous system left a strong telecommunications network and the educational system largely focused on new technologies. The major advantage of Romania are also creative people, who are accustomed to working in difficult and demanding conditions. Another important factor that drives the technology boom in the country is high-speed Internet. Bandwidth of best Internet links make Romania the EU leader and the country has the 6th fastest network in the world. For comparison – the US occupies this ranking only on the 17th position. Such strong position of Romania in this field stems from the fact that it disregarded the stage of development of broadband networks and immediately set (like other countries of the Eastern bloc) fiber links. With rapid development of Internet network, Romanian users have had an advantage over their European peers. It is worth recalling that they attended education system which traditionally puts the emphasis on science. This culture of technology extends to women as well. Perhaps the biggest advantage over other EU countries is that Romania has a large percentage of women working in the sector of information and communication technologies. In this category, the country occupies the 3rd place in Europe.

The main obstacle holding the industry back is access to investment capital. However, to stimulate sustained growth, Romania needs more than foreign investment. It needs an internal marketing team. There are still many problems for Bucharest to overcome, yet there is a lot of potential here.

Innovative startups from Romania

Romania’s most valuable asset is its tech talent force and it is still quite easy to find and hire a good developer here. Yet, funding is insufficient and propitious startups usually move their teams abroad in order to have more chances in raising capital. Romania has a progressive tech ecosystem which does not get enough coverage. Therefore, here is a rank of a few startups from this Eastern European country which should leave you with no hesitancy whether Bucharest may really play a significant role in the tech world.

DeviceHub provides cloud services for the Internet of Things communication. It can be linked to any hardware and is meant for smart metering, fleet management, medical industry, home automation, IoT makers, automotive, wearables. The app lets users to transfer data between devices equipped with Windows or Android. The company received a EUR 80,000 funding from hub:raum Krakow, Deutsche Telekom’s Innovation Hub for the CEE region. This startup is already the second Romanian startup that has been given funds from hub:raum. The first one was OmniPaste in 2013.

Vector Watch promotes itself with 30-day strong battery for smart watches. The company has two product lines pushing a stainless steel frame with a fancy style. They also opened offices in American, British, Swiss and Hong Kong markets. The startup received a $5 million investment led by the GECAD group in 2015.

Skobbler produces navigation apps which have its digital mapping technology, which is based partially on OpenStreetMap. Their series of consumer apps include hybrid online/offline maps app, ForeverMaps2, as well as licensing its mapping engine technology to other companies which plug OSM data into their apps as an alternative to paying for Google Maps. The startup was purchased by the German subsidiary of California-based Telenav for $24M.

SkinVision is a mobile app which reveals mistrustful moles on
people’s skin, advising a doctor appointment or not. The startup states the accuracy of their system is 81%, which is the same as a dermatologist’s eyes. The startup moved to Amsterdam in 2012 following an investment round. It raised about €4.5 million in 5 years. The company currently participates in several research and data-gathering projects. It has collaborated with the Ludwig Maximilian University of Munich, a partnership which resulted in a paper published in the European Journal of Dermatology.

Pocketo  is a hardware platform which helps you develop Internet of Things projects with or without using physical components (like sensors, buttons, leds etc.) by providing a Bluetooth and WiFi development board. The app simulates those physical components, which would fit neatly into your design when you are finished. Then, the physical components fall right into place with your code, no adjustment needed.

123ContactForm provides web forms and surveys for different companies and NGOs worldwide. The company offers fast, easy and cost effective way of creating an online form which users can publish on Facebook, on their blog or on their website. They can link their web forms with 3rd party services, such as Google Docs, MailChimp, SalesForce and Twitter, with only one mouse click. The startup has raised €1 million from 3TS Catalyst Romania, the leading private equity growth and venture capital fund dedicated to Romania.

Programmers in Romania released from income tax

Europe lacks programmers, especially IT industry lacks those professionals – the problem face both: highly developed countries and those, that are chasing the forefront. Struggle for professional programmers is a fact, and with time the problem will probably grow. Therefore, companies and countries are developing strategies to give these employees an advantage in this race. An example is Romania, which releases the mentioned professional group from income tax.

The solution may be, of course, to invite programmers from other countries. But after a while, they can leave. A serious increase in the number of students in these field may, in turn, negatively affect the quality of teaching and level of skills of graduates. To give out diplomas will rather not improve the situation. Therefore, companies are increasingly trying to attract their employees to keep them for longer. This direction is followed by countries, just like Romania does it.

Romania wants to exempt from income tax all the programmers. Currently, such a privilege has only a part of them. This way the government wants to keep them in the country. Currently, in Romania, from the income tax there released those programmers, who work for companies whose annual revenue from software sales is at least $ 10 thousand per employee. These rules have been applied since 2004. Recently, the Ministry of Communications of Romania signaled that the state should take further steps to keep the IT experts in the country. The $ 10 thousand limit may be abolished in order to encourage start-ups, especially because IT is the best-paid sector of Romanian economy.

Deloitte published the Technology Fast 500 rank

Already for 16 years Deloitte has been conducting the Fast 500 EMEA ranks, which bring together the fastest growing technology companies in Europe, Middle East and Africa. The ranking is prepared based on the percentage increase in operating income from sales over the last 4 years (2012 vs. 2015). The average revenue growth rate of all companies included in the newest rank amounted to 967%. For comparison, in last year’s edition it was 1 012%  and 1 711% in 2014. This result indicates the growing maturity of the technology industry in the EMEA region.

For the third time in the history of the rank, a Central European company is on the podium. The last time was in 2012, when Romanian company Vola.ro with the increase of 17 323% took the third place. This year’s leader is Swedish company Fingerprints Cards, specializing in biometric technologies. Over the last four years, the company recorded an increase in revenue of more than 28,000%.

Companies from Central Europe are becoming more apparent among the fastest growing technology companies operating in global markets. Gaining importance are especially those operating in the field of nanotechnology, biotechnology and energy. An example might be HiProMine, which developed the technology of industrial breeding and insects processing. Deloitte strongly supports ambitious technology companies by its platform for cooperation and exchange of experience, for example: the Alumni Fast 50 Program or strategy workshops for the winners.

The largest category of companies, which have been included in the Deloitte Technology Fast 500 EMEA, are software developers. They constitute up to 50% of the entire list. Another large group are companies operating in the media – there are 14% of them. Third place was taken by entities of the communications industry – 10%.

As in previous years, the most strongly represented country is France. There are 94 French companies on the list. The second place belongs to Great Britain, and the third to the Netherlands.

Who are Internet users in Europe?

Gemius analysts have just recently published data on the number of Internet users in Central and Eastern European countries and calculated their internet penetration rate (they checked what percentage of the population are Internet users in a given country).

There were taken into account European countries, where Gemius conducts Internet research: Denmark, Poland, Czech Republic, Slovakia, Hungary, Slovenia, Serbia, Croatia, Estonia, Lithuania, Latvia, Bulgaria and Romania. The data comes from 2015 and refers to population aged 18-69 years (with the exception of Bulgaria, for which data refers to 15-69 years old people).

GemiusAccording to the estimates, the audited country where Internet users represent the largest percentage of population is Estonia. 86% of Estonians are active in the network. In the forefront there are also the Czechs and the Poles. Only every fourth citizen of these countries at the age of 15-69 years did not use the Internet. In turn, the country which recorded the lowest percentage of Internet users, is Romania – 58%.

Internet users in Europe

Countries, where you can observe the greatest gender disparities in structures of Internet users, are: Serbia, Croatia, Romania and Latvia. In Romania and Latvia, males account for 53% of Internet users. On the other hand, in Serbia and Croatia women outclass men by even more percent points. Serbian females account for 56% of Internet users in their country, while Croatian females for 54%.

On the other hand, Moldova is a country where people aged 15-24 constitute the largest group of Internet users – 29%. In Ukraine the largest age group of Internet users are those aged 25-34 (29%). Every fourth Czech person using the Internet is 35-44 years old, every fifth Latvian is 45-54 years old and one in five Estonians is 55 years old or more.

In all the analyzed countries the greatest share in population of Internet users are people with secondary education. The leader of these countries is the Czech Republic, where representatives of this group are 67% of network users. The country with the highest proportion of Internet users among people with higher education is Ukraine – 4%. Meanwhile, the country with the lowest percentage of Internet users with university degree is Slovakia – 21%.