The startup sector in the country is an impressive mixture of ideas, talent and opportunities
"A journey of a thousand miles begins with a single step": the popular quote by Lao Tsu is relevant for business, too. Many of the innovations, the companies and the products that we now consider a necessity have started with a single step, a bold idea, an enthusiastic team, a lot of work and the right dose of luck.
Contemporary business understands that. Anticipating "the next big thing," states and investors develop business accelerators and incubators, create programmes and policies for stimulation of innovation in all fields of human knowledge and business. After a hesitant start, Bulgaria is already an active part of this trend. According to the European Investment Fund, while in 2012 barely 20 Bulgarian companies have attracted investments for $4 million, in 2016 their number rose to 74, and the investments increased to $74 million. The startup community in the country is getting more active. Competitions are held, seminars and conferences with international participation are organised. Founders of startups in the country are not only local entrepreneurs, but also foreigners and Bulgarians who have returned after emigration abroad.
What made Bulgaria such lively place for startups?
On the one hand are the favourable conditions for developing an IT business. Bulgaria is well known for its qualified workforce. In the past few years companies and specialists are actively searching for ways to break from the cliche that the country is a destination for cheap outsourcing only. That effort was inevitably reflected in the condition of the local startup field. Bulgaria also has advantages such as low taxes and good quality of the Internet connection.
However, startup companies – and their innovative ideas, need funding. In the past few years the opportunities to find it via local or international investors, venture funds, business angels and organisations such as the European Investment Fund are increasing.
"For a number of reasons at the moment Bulgaria is a good place to start a business – from the lower operational costs to the number of problems for solving that provide opportunities for innovations," says Elitza Stoilova, founder and CEO of Umni.co, virtual assistant' agency (www.umni.co). "Accelerators such as The Founder Institute, whose programme Umni.co graduated, make the testing of a business idea more accessible and the startup development more stable, as there is a place where you can work on your project while you are still going to your regular job, and you will receive valuable advice and help by entrepreneurs who already have accumulated knowledge and skills in this field. The interest towards startups is growing in our country as well as from businesses outside of Bulgaria. Young companies are taken more seriously now in Bulgaria and there are much more opportunities for funding, training and programmes for development."
The success of Bulgarian startups is usually associated with IT industry. It was in this field where impressive acquisitions were made, such as the sale of the software development startup Telerik to U.S. Progress in 2015 or of the aviation platform Vayant and the mobile images software MM Solutions in 2017.
In reality, startups search for, find and develop solutions in each field of the human knowledge, and Bulgaria is not an exception. Such companies could benefit a lot from a more diverse approach in funding.
"Over the last several years, the startup financing climate in Bulgaria has greatly improved and funding is now available through various instruments, institutions and VC's," says Olga Marcenac, co-founder of Nasekomo (Sofia, 2 Grigor Parlichev St, www.nasekomo.life), a company for use of insects as a sustainable alternative for traditional and resources-depleting animal feed. "However, these financing options are tailored mainly for companies in the IT sector. We would love to see similar options made available for the agtech sector, where we are. Another aspect that impacts us is due to the nature of our business. As insect farming is a fairly new industry, we experience some scepticism and hesitance when we first introduce the concept to various third parties. It is our job here to ensure that we educate the public about the benefits of insect farming and hopefully inspire others to take actions towards protecting the environment of our planet."
In spite of the problems, the excitement in the startup field in Bulgaria is a fact. This is evident by the rising number of coworking spaces, particularly in Sofia. They provide their tenants with all the amenities of a real office.
"Coworking's main advantage is that it allows companies to focus entirely on their growth as they don't have to bother with things like office maintenance and the expenses linked to it," says Gergana Dzhevelieva, Marketing and Communications Manager at betahaus Sofia, the first coworking space in Bulgaria (Sofia, 56-58 Krum Popov St, www.betahaus.bg). "The connectedness between the people and the opportunity to communicate and to help one another is also a major advantage from which everyone can benefit. We are open for people and companies from all fields."
That is exactly one of the startups' strongest points. Due to their small size, innovative ideas and enthusiasm they are better equipped to offer a flexible solution to dire social problems that everyone else neglects due to inertia. They can look at old problems from a new perspective, finding potential where the rest have seen only obstacles. This makes them carriers of positive change for the society.
"The feeling of personal social responsibility is in the basis of how the potential of startups can unfold and bring positive change," says Ashod Derandonyan, founder of the Listen Up Foundation for innovative solutions for equal access to information and communication for deaf people (www.zaslushaise.bg). "If every one of us, social entrepreneurs, takes as a mission what we do, then we will succeed. We should be open and authentic and we should know the people who our services and products are aimed at. We should closely examine if we succeed in meeting their needs for fulfilled and quality life. The potential is huge because it is social startups that are able to create a fairer society. Doing business does not mean making money. The successful social business is the one that has found the golden mean between social impact and financial sustainability. Last but not least, let's think on how to built a dialogue of partnership with people with different abilities, because they can provide a lot if they have the opportunity. As Helen Keller, the first deaf-blind person to earn a university degree, has said, 'Alone we can do so little; together we can do so much'," adds Ashod Derandonyan.