There are many promising new innovation hubs springing up around the world, but one of the most exciting is Bulgaria. The Balkan nation on the edge of the Black Sea has the history, the culture and the future to be a great tech nation in Europe — all the factors that made sense for Sciant to build its base from.
Start-up investment growth
Despite being one of the lowest recorded GDP per capita, Bulgaria has huge growth and expansion opportunities which is already being realised. Bulgaria is playing rapid catch up in tech innovation with 210 start-ups raising £74m, up from just 20 companies making $4m four years previous, according to the European Investment Fund. This, hand in hand with a 17% average annual growth in Bulgaria’s IT sector since 2007, led one commentator to call Bulgaria the “hidden start-up champion of Europe”, and the Brighton School of Business and Management to list it in its top ten cities in which to launch a start-up.
Eastern Bloc’s IT specialist
Post World War Two, Bulgaria became the Eastern Bloc’s IT and electronics specialist, providing at its height 40% of all computers to the Eastern Bloc, resulting in a solid base of talent where computing had reached the core of the region’s education. After the fall of the Berlin Wall, this talent-base was exploited by big western tech firms, outsourcing its skills to companies like Hewlett Packard, Microsoft and Cisco Systems.
Strongest coding reputation
In fact, so great is this wealth of talent that a survey of Stack Overflow data showed that Bulgarian coders have the strongest average reputation in the world on the coder Q&A platform. Add to this an excellent broadband infrastructure, a strategic location between east and west, competitive rates of labour and one of the lowest business income taxes in Europe (10%) and you have an excellent recipe for tech growth.
Women in tech
Another surprising factor — and another legacy of communism — is the excellent proportion of women working in the tech sector. In Bulgaria it’s 27%, compared to 16% across the rest of the EU. This broader workforce base originated in the Soviet era where workplace equality was encouraged. This solid foundation has continued with ongoing investment in a modern education system with outreach programmes in the tech sector.
But the biggest reason for the recent acceleration has been increased funding for innovation, both from government and EU sources. The EU invested $1.5 billion in Bulgarian micro and SME businesses, a quarter of which the government poured into start-ups. Start-up accelerators, incubators and seed funds were the main recipients, such as Launchub, which started in 2012, investing in 62 start-ups. And last year the government announced another $185 million programme for start-ups.
These initiatives have led to success, with companies like Telerik, Chaos Group and Tickey creating ripples. Telerik was sold to US Progress for $265 million in 2015, while Bulgarian travel start-up, Vayant, was bought for $35 million. And mobile image software provider MM Solution was acquired by a Chinese company for $37 million.
There are still many challenges left to overcome but the change in the last decade has been remarkable and looks set to continue. Bulgaria could soon be viewed as a Mecca for tech innovation, drawing coders, developers and engineers from all across the world. We’re proud to be part of this change, for which we have contributed to the last three years to bring digital and tech transformation to the hospitality, travel and logistics and transport sectors.