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The venture ecosystem of Poland

The venture ecosystem of Poland

23 Sep 2019

Poland is a country with perhaps most demostracion prices in Europe and rich cultural heritage. However, it is not a full list of remarkable characteristics of it. It turns out that in Poland startups have excellent conditions for development. In this article, we will find out what is interesting in the venture ecosystem of Poland and the way for a foreign startup can get there.

Startup Jedi

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What is interesting in Poland for startups

1. Region and prices.

Poland is a good place for startups in the terms of geography and demography. This is a big country by the area and population, however, the prices are lower than in most of the other countries of the region. Thus, if we talk about the costs for the office and services, the startup development in Poland would be relatively reasonable. Plus, there is a possibility of entering the pan-European market.

By the way, the overall Central European region attracts the investors, since a few famous startups, that is referred to as unicorns, were born there: Skype (Estonia), AVG (Czech Republic), CD Project (Poland), Allegro (Poland) — and Poland itself in particular. There are branches of some transnational corporations located in Poland: Google, Microsoft, HP, IBM, SAP, Samsung, Intel, Oracle. Dozens of venture capital funds and private investors from the USA, UK, Germany, Czech Republic, Finland are interested in finding the best investment solutions here.

2. High positions in international rankings.

Poland is illustrative of the highest activity in the private investment market among European emerging economies. 

The venture company Atomico in its report of 2018 named Warsaw, Wroclaw and Katowice the most fast-growing technological centres of Europe.

In 2018, Poland took the 30th place in the World Bank: Foreign Direct Investment 2018 Ranking by countries and areas, that was compiled by the International Monetary Fund.

According to the Venture Capital and Private Equity Country Attractiveness 2018 Index by IESE Business School, Poland is ranked 26th among 125 countries, Belarus is 97th. There is a lot for us to strive for.

3. Startups are supported at the government level.

The neighbouring country supports startups at different levels, from the governmental to municipal.

The authorities have their interest in financing foreign startups, including Central and Eastern European ones, and attracting them to the country. The procedure of entering the Poland market by a foreign startup is going to be described precisely below. Meanwhile, I will give another interesting fact. Universities take care of the students to learn about how to create and launch their own startups. There are dozens of IT companies which work in the informational technology clusters, that have been formed around universities.

4. Startups evolve in various fields.

In 2017–2018, the largest investments in Poland could attract startups from sectors such as medicine (64.5 million PLN), education (53.2 million PLN), beauty (43.9 million PLN), lifestyle (19.3 million PLN) and software (17.7 million PLN). When a project has a well-designed business plan and a minimum viable product, the question of finding an investor and attracting money for it is a matter of time and team enthusiasm.

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polish startup ecosystem

Poland-based VCs

At the beginning of 2019, the Polish Private Equity and Venture Capital Association (polish — Polskie Stowarzyszenie Inwestorów Kapitałowych — PSIK) has had 55 full-fledged members. The organization unites active private and venture Polish investors. The mission of the association is to promote and evolve the private equity and venture investment industry in Poland, as well as to represent the interests of community members at the domestic and international levels.

An interesting fact: to this date, association members have already invested 11 billion euros in more than 1,400 Polish companies.

There are Polish venture funds that have displayed great activity during the last few years. It is noteworthy that almost all major Polish startups easily attract investments from abroad on a par with domestic ones.

Market One Capital

Website: http://moc.vc/
Total funds raised: e35M
Total number of investments: 10

This is the venture capital fund which is interested in the marketplaces and software for B2B. Alongside this, it is noted at the website of the organization that, first of all, investments are made in people. To put in other words, the project team, their member’s motivation and development of professional competences are on top of importance for the investor.

The fund works with startups from European countries. They have offices in Warsaw and Barcelona. In May 2017, alongside with other investors, the company invested in the startup Docplanner. It is a service for booking visits to doctors. The total amount of investments is $16.8 million. The startup is working in 15 countries already, 30 million unique patients visit doctors by booking the slot via the service. Currently, the project`s offices are located in 6 cities around the world, the website presents information about a few dozens of job opportunities in the spheres as IT, marketing and PR, sales, HR recruiting, etc.

In July 2018, alongside with 2 other investors, the fund invested in a CallPage startup, founded by Ukrainians. The total size of investments counts is equal to $4.5 million. The startup is devoted to sales. In particular, the project offers one-moment calls service to the site visitors. By the way, Audi is one of the startup`s clients.

Inovo VC

Website: https://inovo.vc/
Total funds raised: e6,79M
Total number of investments: 14

This venture capital fund is investing in innovative companies with a high potential for significant growth at the late Seed/Series A in Poland and Central and Eastern European countries.

Investing criteria:

  • A market has to be vast enough for a company to become a unicorn;

  • The team aims to conquer the market;

  • Proven Product market fit;

  • The startup presence at least in two countries with the demonstrated growth of minimum 2 times per year.

Experior

Website: http://evf.com.pl/en/
Total funds raised: e18,46M
Total number of investments: 16

The venture fund that invests in small and middle-sized companies with a high potential for growth. Alongside with the capital itself, the fund offers the strategic and operational support to the teams and owners of the businesses/startups.

Investing criteria:

  • The startup has a motivated and qualified team of managers;

  • The product has hard competitive positions;

  • There is a specified value proposition for the client;

  • The product is scalable;

  • The startup is at the growth/expansion stage;

  • The project has a potential for money generation.

Innovation Nest

Website: http://www.innovationnest.co/
Total funds raised: e100M

Invests in European companies, engaged in software programming. The project investment volume is from 100 thousand to 1 million euros.

In November 2016, the Innovation Nest, along with many other investors, invested in a Silvair project for room lighting management via Bluetooth. The total investment volume was $12 million.

In April 2017, the fund became one of the co-investors for an Elmodis project, that specializes in the innovative decisions for the industrial enterprises. The total investment volume is $4.9 million.

In August 2017, in liaison with two other investors, the fund invested in a PerfectGym project. The total investment amount is $5.3 million. The PerfectGym is a polish startup. It is a software product for fitness club management. The project offers solutions for businesses in different fields of sport.

Protos VC

Website: http://en.protos.vc/

The company is focused entirely on Internet business in Poland. It invests in projects that are based on the software as a service, marketplaces, generators for potential customers and lead generators.

Giza Polish Ventures (GPV)

Website: http://gpventures.pl/
Total funds raised: e19,39M
Total number of investment: 32

The Polish venture capital fund, supported by the Israel company (Israeli VC group Giza Venture Capital). A parent organization has been operating in Israel since 1992. Its specialists have experience of working with startups from a number of business areas: from communications, informational technologies, corporate software development to entertainment and media. Being founded in 2012, the Polish GPV fund has already invested in more than 10 startups and companies — from biotechnologies to customer-oriented Internet services.

RTAventures VC

Website: http://www.rtaventures.com/
Total number of investment: 20

The Polish venture capital fund that focuses on investing in online businesses, developing healthcare products.

In May 2016, it invested to the already mentioned project Docplanner alongside with several other funds. Still, since May 2017, it had not been participating in investing anymore.

Over the past 8 years, RTAventures VC has made 30 investments in eight countries.

SpeedUp Group

Website: https://speedupgroup.com/en/
Total funds raised: e23,08M
Total number of investment: over 50

This fund is ten years old already. It is mostly interested in the projects in the next spheres: consumer Internet, financial technology, marketing technology. The company members believe that all the World is close to the point where each process becomes streamlined and structured, traditional human labour will be replaced by computerized machines work. In this context, the fund wants to create companies that can conquer global markets.

Smok Ventures

Website: http://smok.vc/
Total funds raised: e10,69M

It is a Polish-American investment fund. It invests in Polish startups in the early stages. The project investment volume is $ 100,000 — $ 1,000,000. Smok Ventures is mostly interested in startups related to games, artificial intelligence, financial technologies and marketing technologies.

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Poland startup ecosystem

Polish programs for foreign startups

Due to the fact that Poland is one of the most fast growing countries in Europe, opening a business or launching a startup here is going to be a good idea. Moreover, it is much easier to do it in Poland than in several other European countries. The reason is in the number of available programs for foreign startups. Let’s consider some of them.

Poland Prize

This is a part of the Start in Poland program, which provides a breeding ground for startups in Poland — from the incubation phase and development to expansion to the foreign markets. The Poland Prize program offers similar opportunities for the best foreign startups.

There are 6 operators which work within this program`s framework. Their main task is to prompt the most promising foreign startups to relocate their businesses to Poland. The operators are StarterHugeThingStartup Hub PolandSpace3acbrincAD VENTURES.

Startups that survive an elimination process of the program can bargain for the list of the following benefits:

  • Simplified visa route, assistance in resolving administrative issues;

  • Grants for up to 200 000 zlotys (that is equal to $50 780);

  • Up to 50 000 zlotys ($13 000) for the legal, accounting and consulting services;

  • Specialized technology consulting;

  • Mentoring and networking.

How to join the program?

  1. Select an operator. Each of the 6 operators has its own application deadline. For example, the HugeThing accepts forms from September 28 to November 30, 2019.

  2. Send your application and presentation of the business plan to the operator.

  3. Pass an interview with a consultant.

  4. Wait for the application approval and join the program.

Polish-Ukrainian startup bridge

This is a special program of the Ministry of Investment and Economic Development of Poland that aims at searching for startups in Ukraine. A lot of Ukrainian students study in Poland. More than 50% of the foreign students in the country are Ukrainians. Belarusians are the second-largest nationality of foreign students, figure up to only 8% of the total number.

Poland is interested in young people who create innovative products and launch them on its market.

As it has been already mentioned, one of the above-mentioned startups CallPage was invented and launched by Ukrainians. The cost of the project in April 2019 was estimated at $ 20 million.

Another example is the startup Buki, that was also transferred to Poland from Ukraine. The project`s concept is the tutors` search with the use of certain parameters. About 2300 teachers use the project at work today.

BValue Fund and neighbouring countries opportunities

In July, some pieces of information appeared noting that the Polish fund bValue was going to invest in startups in Central and Eastern Europe. Its capitalization is about $14 million. The investment region includes Ukraine, Belarus, the Baltic countries, Bulgaria, Romania, Hungary. This fund has already become one of the most active in Ukraine this year.

BValue is one of the most active venture capital funds in Poland. Projects in the field of B2B, that have a perspective of conquering the global market, are in the biggest interest for it.

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Resume

Venture ecosystem of Poland is somewhat of an ideal example of the startup environment development. Different venture funds operate here both from Poland and originated from foreign. Startups attract millions of investments and they are guaranteed with support at the international level, including the foreign projects that participate in the special programs.

In case if the startup of yours has a great business plan and a minimum viable product, it has a real chance to find an investor in Poland even without participating in a specialized government program for foreign startups. For example, an application filing for foreign startups that want to relocate to Poland will be open until November 30 (HugeThing, you remember?). Don`t wait and go ahead!

23 Sep 2019

 

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