In terms of ease of doing business or access to finance for start-ups, Warsaw is slightly below the European average. These are the conclusions of the “European Start-up Survey” conducted by PwC and Münster University of Applied Sciences. 64% of the surveyed start-ups intend to increase employment within 12 months, although recruitment of qualified employees with appropriate competences remains a major challenge.
The survey conducted by PwC and the Science-to-Business Marketing Research Centre at Münster University of Applied Sciences involved 540 start-ups from 18 key cities in the EMEA region. According to respondents, the key challenges for the development of their companies include: sales and reaching customers (23%), attracting talent and retraining (10%) as well as innovation and product development (9%). On the list of threats, the highest positions are occupied by competition (19%), fast-moving market (13%) and national regulations and bureaucracy (12%).
The main source of financing for start-ups are the founders' own funds (66% of cases). Only less than 9% have obtained financing from an external investor, the so-called business angel. 7% have been financed with Venture Capital of another company, and 6% – with Private Equity funds. Crowdfunding is not a very popular solution – it has been used by only 1.5% of the start-ups surveyed.
Representatives of start-ups who took part in the survey evaluated the ease of doing business in a given city. In this respect, Stockholm and Oslo turned out to be the best while Rome and Vienna were at the end of the list. With the average for all cities included in the survey at 85%, Warsaw is only slightly below at 83%.
As far as the ease of access to financing for start-ups is concerned, Warsaw also slightly differs from the European average: 43% vs. 45%. The best in this respect are Helsinki, Tel Aviv and Oslo. The largest financing problems are encountered by innovative companies in Rome, Dublin and Zurich.
Every year, the Startup Collider programme receives several hundred applications from young companies that want to reach potential customers with their solutions. In order to meet these needs, together with start-ups we develop an offer for corporate clients, taking account of their individual needs. Global technologies and solutions are also presented outside Poland as part of the international PwC network. The level of technological advancement of Polish start-ups is similar to that of other European countries, although our companies are usually smaller in terms of capital.
The fight for talent
European start-ups are developing rapidly – 64% of those surveyed intend to increase employment over the next 12 months (45% in Poland), although at the same time 53% indicate difficulties in recruiting qualified employees. Companies in Berlin, Stockholm and Budapest face the largest talent problems. Finding new employees is easiest in Oslo and Rome. The percentage of respondents who have indicated difficulties with recruitment in Warsaw is also quite high (62% with the average for all surveyed cities at the level of 53%).
In approximately 28% of cases, recruitment problems are simply due to the lack or inadequacy of the candidates' competences. A quarter of applicants – according to the respondents participating in the survey – have too high financial expectations, and every fifth applicant participating in the recruitment process finally decides to take up employment in a larger or more stable company.
Attracting and retaining talent is not only a problem for start-ups, but also for all companies, especially in the CEE region. The competition among employers is huge, and the increasing mobility of people makes Warsaw compete not only with other centres in the country, but also with e.g. Oslo or Tel Aviv. The right strategy in the area of employer branding and employee management is crucial for development of the company and gaining a market position. Our survey shows that the most desirable competences for start-ups are: interpersonal and social skills, unconventional thinking, creativity and a comprehensive approach to solving problems.
PwC Startup Collider and Future Space Accelerator
PwC has been running the Startup Collider start-up scaling programme for 3 years. Its aim is to support and promote innovative technology start-ups, primarily from the Central and Eastern European region, and to help them develop in new markets. Participation in the programme provides young inventors and entrepreneurs with an opportunity to establish direct cooperation with PwC's experts and mentors as well as with the company's clients in the region and beyond.
This year also saw the launch of the Future Space Accelerator programme. It is addressed to start-ups from the broadly understood space industry. The project is run by Airbus Poland, Cleanproject, SatRevolution and PwC Polska. Selected start-ups, offering innovative solutions, will receive support in the optimisation of business models, and in addition will have the opportunity to cooperate with partners of the programme and will be provided easy access to international investors. Applications May be submitted until the end of July 2019.