How equity crowdfunding develops Romania’s Tech Sector
Stimulated by the success of UiPath – the first Romanian unicorn, the local tech start-ups ecosystem is experiencing a radical transformation. 2020 was the Year of Angel Investments in Romania - we’ve seen double-digit growth in the…
Stimulated by the success of UiPath – the first Romanian unicorn, the local tech start-ups ecosystem is experiencing a radical transformation. 2020 was the Year of Angel Investments in Romania - we’ve seen double-digit growth in the ecosystem indicators: number of start-ups, new accelerators, capital raising rounds, total funding amount. While in 2019, approximately €3 million have been invested in Romanian start-ups, by Romanian business angels, with about 20 start-ups receiving pre-seed and seed funding, 2020 has seen a breakthrough: 54 start-ups received funding, totaling approximately €18 million of angel investments and equity crowdfunding campaigns.
In this positive investment context, Romania should take advantage of its second largest economy in Central-Eastern Europe and its long tradition in IT education, to strengthen its position in the region. The pipeline of local and international ventures is no longer led by a few small-sized E-Commerce companies and their marketplaces; it rather shows now a balanced mix of innovative ideas in FinTech, E-Health, Blockchain, Artificial Intelligence and some HR related solutions. Romanian start-ups are significant growth drivers, contributing to economic dynamism,spurring innovation and stimulating competition. The Romanian Software Industry Association (ANIS) states that the objectives of the local IT industry for Digital Romania in 2025 are for the IT&C sector to reach 10% of the GDP, from about 6% currently, stimulating the digital economy.
Funding of Romanian start-ups became more sustainable and diversified. The ability to invest & the collaboration spirit, are constantly increasing in the communities of investors, business angels, mentors, accelerators and incubators. In the last year, most pre-seed and seed funding were driven by a blend of local Romanian VC funds, micro-investors and international investors, connected by the SeedBlink investment platform. The top of the locations for Start-ups & investors shows Bucharest as leading, followed by Cluj-Napoca, Iasi and Timisoara where new tech hubs are emerging.
Equity crowdfunding mobilizes the communities of micro investors, and the ecosystem accelerates exponentially its development, due to their collaboration. Not being focused on angel investors, the equity crowdfunding platform SeedBlink had a serious contribution to the start-up ecosystem in 2020, by hosting 26 crowdfunding campaigns with a total value of more than €8M, out of which more than half sourced from equity crowdfunding investors.
