Start-up challenges – innovation, growth and
internationalization
An Overview of Macedonian Entrepreneurial Ecosystem
Prof. d-r Radmil Polenakovikj Business Start-up Centre, Faculty of Mechanical Engineering, Ss. Cyril and Methodius University
&
National Centre for Development of Innovation and Entrepreneurial Learning
An Overview of the Macedonian Entrepreneurial Ecosystem
Macedonia before 1990:
• Part of Yugoslavia
• Centrally planned economy based on big organizational systems (> 1000, 5000, … employees)
• 20,000,000 citizens – big domestic market and huge export
• Public companies (very narrow private sector)
• Relatively strong economy
• Decent standard of living
• Poor system of free labor market, but low level of unemployment
• Entrepreneurship was not on the Agenda
An Overview of the Macedonian Entrepreneurial Ecosystem
• International (donor) support was necessary in late 90’s and beginning of
XXI century to establish entrepreneurial ecosystem in the country (many
failures, but also – successful cases): • World Bank (7 business indicators established in the country – 1997)
• GTZ (Germany – 4 technology transfer centers – 2003)
• Holland (MRFP – microcredit facilities – 2003)
• ADA (Austria – UKIM Business Start-up Centre – Skopje – 2006)
• SINTEF (Norway – YES Incubator – Skopje – 2006)
• SPARK (Holland – Business Start-up Centre – Bitola – 2007)
• USAID (USA – CEED – Skopje – 2007), now also with Swiss support….
and
• many EU programs (Tempus, FP7, Erasmus+, H2020, CBC, transnational, with
direct support to many public organisations, but also NGOs…)
An Overview of the Macedonian Entrepreneurial Ecosystem
Recent key moments for the development of the Macedonian
Entrepreneurial Eco-system (1):
- Law on Innovation activity – 2012
- Establishment of the Fund for Innovation and Technological Development –
end of 2013 and intensification of its activities in 2017-2018
- Entrepreneurial Learning Strategy 2014 – 2020:
- Introduction of courses “Innovation” in Primary Schools (IX grade) – 2013
- Introduction of courses “Innovation and Entrepreneurship” in I, II and III grade
of Secondary education, while in IV grade there was already course “Business
and Entrepreneurship” – 2012
An Overview of the Macedonian Entrepreneurial Ecosystem
Recent key moments for the development of the Macedonian
Entrepreneurial Eco-system (2):
- Stronger support to NGO sector and institutions
- Establishment of Technology Park at the Southeast University in Tetovo
- Establishment of 3 Associations of Business Angels – after 2015
- Development of private Start-up supporters (SEAVUS, New Mans Business
Accelerator, Start-up Macedonia, CEED Hub Skopje, ….)
- Strong emphasis on domestic economy and support to domestic
companies – Vice-Premier responsible for economic affairs – since 2017
- Foundation of INNOFEIT - 2018
- and all of this lead to . . . strenghtening of start-up community in the
country
An Overview of the Macedonian Entrepreneurial Ecosystem
Fund for Innovation and Technological Development activities:
• Supported over 100 innovative projects/companies with over 10 mil EUR (public co-investment up-to 85% of the total project value)
• These projects have mobilized about 7,5 mil EUR additional private capital in co-investment
• Over 500 people are newly engaged in innovative projects. Average salary of these people, engaged in innovative companies is twice the level of average salary in Macedonia
• It is expected for another 50 innovative projects with a total budget of about 6,5 mil EUR Fund co-financing and 3,5 mil EUR additional private capital co-investment to be contracted by the end of 2018
• Supported establishment of three business accelerators with total contribution of 1,5 mil EUR
• In 2018 the Government increased its support to innovation and technology development over 13 times (1300%) in comparison to previous period
An Overview of the Macedonian Entrepreneurial Ecosystem
Main problems/challenges of the Macedonian Entrepreneurial
Ecosystem:
- Low level of collaboration among actors of MK ecosystem
- Continuity after finishing of the donor support
- Continuity after the change of the Government (political parties)
- Too much politics in day-to-day business
- Lack of entrepreneurial education in the formal education system
(especially on the university level)
An Overview of the Macedonian Entrepreneurial Ecosystem
Main problems/challenges of the Macedonian Entrepreneurial
Ecosystem:
- Lack of funding for the intermediate stage of start-ups development
- Problems with legislative (especially IP rights)
- Low interest among entrepreneurs and the business community to
work as start-up mentors / coaches
- Lack of support from the local community and lack of experienced local
leaders (on the municipality level)
- Low level of human capacities among institutions providing start-up
support (usually 1 to 5 persons)
An Overview of the Macedonian Entrepreneurial Ecosystem
Lessons learnt • It was wrong just to make “Copy-Paste” from best practices worldwide. Best
practices should be adopted and adapted to the local circumstances.
• However – not only international support was / is prerequisite for building the national entrepreneurial eco-system. System of triple / quadruple helix in a basic form exists in Macedonia, but it is based more on the individual level initiatives (person or single institution).
• Hard working and committed Government (+ dedicated Ministries and Agencies) with increased involvement of private sector are STRONG precondition for development and growth of the entrepreneurial ecosystem and whole economy. But also, respect what predecessors done – and continue.
• Continuous support from the top management (Director of Agency, Rector, Dean or Head of the institute) is a MUST prerequisite for sustainability of good practices. Find domestic champions in different areas and support them.
An Overview of the Macedonian Entrepreneurial Ecosystem
Next steps • Internationalisation of the Macedonian start-ups. Increase the access
to customers and networking with other start-up communities
• Strengthening the capacities of institutions that provide start-up
services (both public and private)
• Increase the access to finance (private funds, business angel
networks and state support)
• Increase the access to talents and to ideas. More entrepreneurship
in formal education and better pre-acceleration programs.
An Overview of the Macedonian Entrepreneurial Ecosystem
Next steps • Finalised Smart Specialisation Strategy (Ministry of education and
science and Ministry of Economy)
• New activities of FITD:
• Finalizing the feasibility phase of the process of establishing a Science and Technology Park in Skopje.
• Initiated process of establishment of an Equity and Mezzanine Fund which will invest 7,5mil EUR public money and mobilize additional private capital to enhance growth of start-ups
An Overview of the Macedonian Entrepreneurial Ecosystem
Thank you very much for your attention
National Centre for Development of Innovation and Entrepreneurial Learning & Ss. Cyril and Methodius University Business Start-up Centre Faculty of Mechanical Engineering Karpos II bb., POBox 464 1000 Skopje, MACEDONIA Tel: +38923099481 / Fax: +38923099482 e-mail: [email protected], [email protected]
Prof. d-r Radmil Polenakovik