Prague is undoubtedly one of the world’s most beautiful cities, with an abundance of breathtaking Baroque, Gothic and Renaissance architecture. However, Prague’s historical aesthetic has not impeded its transformation into one of Europe’s most fertile technological centres. Beneath this outwardly traditional city lie richly innovative startups, more established tech giants, and a host of investors willing to fund the next big project.
An Appealing Location for Tech Investment
Prague enjoys a recipe of economic, social and geographical conditions that is a huge draw for startups and entrepreneurs. In a study by the international consultancy company Arcadis, it was ranked the second best city to live and do business in Central and Southeast Europe. Its corporate tax levels are some of the lowest in Europe at 19%. It has low living costs. You would need around £2,236.42 (Kč65,966.03) in Prague to maintain the same standard of life that you can have with £4,700.00 in London (assuming you rent in both cities). Labour force costs are also low, meaning companies are able to scale quickly and with lower risks.
A rich talent pool of English-speaking tech professionals is complemented by Prague’s close proximity to the rich market areas of Berlin and Krakow. All of these factors have contributed to the Czech Republic becoming the second-largest private equity market in Central Eastern Europe.
Prague has been the birthplace of numerous industry-leading technology companies. The city also acts as base of operations for a number of others.
Tech hubs, particularly those in smaller countries, often focus on one field in particular. For Prague, this is cybersecurity. This has been driven primarily by success of Avast, one of the world’s biggest cybersecurity companies, which is headquartered in Prague. Founded in 1988, it has now expanded into machine learning and artificial intelligence research. In 2016, it acquired rival AVG Technologies for $1.3 billion, and in 2018 it has its first IPO on the London Stock Exchange, with a value of £2.4 billion — one of the UK’s largest technology listings.
Apiary.io is another exciting Prague success story. They provide tools for companies to build their own APIs. In 2017, it was bought by Oracle, and moved its base of operations to San Francisco. They have raised more that $14 million in funding already, with members of Prague’s startup scene closely monitored by larger investors from the tech scene’s more established markets. Socialbakers, BudgetBakers, Spendee, Gamee… all have received significant investment and are now well on their journey to success.
Prague as a Smart City
Unlike many metropolitan cities which have been slow to devise a strategy for updating their infrastructure to accommodate IoT integration, Prague has developed a well-funded, centralised roadmap. In 2017, the Prague City Hall approved the Smart Prague initiative, which set aside Kč 600 million for the development of a number of projects to modernise the city’s infrastructure and services with IoT functionality.
The Smart Prague initiative has overseen Operátor ICT, a city-run organisation responsible for developing the Lítačka Prague public transit card. A number of pilot projects have already been implemented, including solar-powered benches with WiFi and phone chargers, and smart trash bins that compact waste, and report to the collection company that they are filled, thereby ensuring more efficient pickup and emptying.
A number of other projects are either being assessed for approval, or are already being implemented. Examples include smart sensors in buildings to optimise energy management, installing charging stations for electric vehicles, and installing city-wide sensors to help construct a 3D model of Prague that can aid in planning traffic flow, and optimising future city planning.
Prague may be a smaller tech hub than London and New York at the moment, but their rapid growth across various technological and entrepreneurial areas could teach some of the bigger cities a thing or two.
Primalbase is always looking to establish itself in areas that our international community wants to be. Where would you like to see us open up one of our shared workspaces for the tech community next? You can nominate a city that would benefit here.