Regions of Entrepreneurship

Edible coffee cups from Plovdiv, Formula 1 simulators from Gabrovo, “smart” houses from Stara Zagora, High School of Innovation in Burgas, vertical oyster farms from Varna, hand-woven carpets for the British royal family from the town of Kostadovo... Just as with innovations, businesses can develop where there is someone looking for opportunities and willing to take risk.

According to GEM's 2016/2017 survey for Bulgaria, the number of people who see good opportunities for starting a business in the region they live in is rising - 21% in 2016. And although their endeavours often remain in the areas of trade, logistics, agriculture and low-tech activities, their successes are most clearly noticeable in an international context. The integrated Ekomilk iBond milk collection system from Stara Zagora became a worldwide novelty in 2015. Plovdiv’s sliding doors are sold in Kazakhstan, Qatar, Dubai. Every fifth cosmetic or toothpaste tube in the world is manufactured by a machine that was created in Gabrovo. Varna underwater oyster farms operate in Romania, Georgia and Turkey.

Regional business communities remain a relatively unrestricted and underdeveloped business territory. Their biggest challenge is that for the investments they need in learning, technology and research, they have to rely mainly on their own resources, because the money from operational programmes is distributed inefficiently, and the risk-financing organisations are concentrated in the capital.

The management of Structural Funds under the Innovation Strategy for Smart Specialisation (ISSS) is concentrated at national level and the participation of local administrations is very limited. As a result, certain regions receive funds for areas where there is no interest at all, instead of receiving funds for the directions where they have a developed business initiative.

Nadezhda Gancheva from the Applied Research and Communications Foundation explains that the interest in the thematic areas “Informatics and ICT” and “Mechatronics and Clean Technologies” within OP “Innovation and Competitiveness” is proven by almost two-times more project proposals and approved projects compared to the other two areas, probably due to their much wider application in all economic industries. But more than 70% of the project proposals in the ICT sector come from the Southwest region, which is, to some extent, in contrast with the growing number of companies in the sector outside of Sofia.

“Municipal administrations do not always have the capacity and expertise to support entrepreneurship, the effect from the interaction with businesses depends mostly on the personal initiative of authorities and local companies if they want their needs to be heard and eventually taken into account at national level,” Gancheva adds.  The restricted access to European funding makes new entrepreneurs more resilient, resourceful and willing to support each other spontaneously.

According to Dobromir Ivanov of the Bulgarian BESCO Start-up Association, it is important for start-up ecosystems to be developed throughout the whole country according to the market logic rather than artificially. The organisation is working on a network in more than 100 municipalities in order to support the regional establishment of “advanced conditions for development in the industries of the future”.

Gabrovo, Stara Zagora and Plovdiv renew the traditions of the Bulgarian Revival in the industry and trade with a focus on information technologies and mechatronics, interacting with municipalities with varying success.

“The entrepreneurial system exists at national level, but it is difficult for us to partner with the other regions and the institutions,” comments Petko Petkov from Zara Lab Academy. It has built the LoRa Smart Management Network based on the Internet of Things with a partial municipal funding, but still relies mainly on volunteer work and on its own resources.

An example of how the business and the municipality can look in one direction is given by the entrepreneur from Plovdiv Ivan Bondokov. His marketing agency is working on the strategy of Trakia Economic Zone for turning the region into the “high-tech industrial heart” of the country. “Both Bulgarian and international companies invest a lot of resources in the professional training of young people and in creating good living conditions in the city. We have a municipal business unit that is trained to support new ventures,” Bondov says. According to him, Plovdiv needs to build public development centres and a vision on how to keep the so-called Digital Nomads.

Plovdiv needs a vision on how to keep the so-called Digital Nomads, says Ivan Bondokov

Martin Pavlov from the Gradishte Foundation in Gabrovo adds that if there is an organisation that could create an individual economic concept for each region, this would support the overall development. The city is now building mutual trust both among entrepreneurs and between them and the municipality, which supports innovative initiatives. Gradishte plans to open the first shared workspace in the city. “Some of the companies do not know each other and, until recently, they did not look for a solution to the problems together, but we are changing this with the help of the municipality through networking,” he adds. The events of the Foundation attract students, entrepreneurs at the “idea” stage, through such at “prototype” level, to representatives of large local companies. “The fewer children develop the type of thinking that “nothing happens in Gabrovo”, the better the economy will be in the future,” he is convinced.

Gradishte of Martin Pavlov plans to open the first shared workspace in Gabrovo 

With the Robotics for Children, Zara Lab Academy finds future entrepreneurs in Stara Zagora at an early stage. According to the Institute for Market Economics, the city “has unused potential to develop in the field of information technologies and outsourcing after the example of Plovdiv.” In Stara Zagora, the leading companies are in the field of high technology, but the opportunities for formal and non-formal education in this industry are still limited. Petko Petkov sees the strategic advantage of the region precisely in its specialisation in the so-called smart cities, cloud services, the Internet of Things, engineering, and robotics. “The demand in these areas exceeds the supply. We have to invest in development and education,” he says.

Petko Petkov sees Stara Zagora's strategic advantage in cloud services, engineering and robotics

The regions of entrepreneurship are a fact thanks to the people who have opened a new gate for traditions in the industry and trade, with ahead-of-their-time technology, engineering solutions and business ideas. Government policies, which support them, can catch up if businesses and municipalities look in one direction, and if the state is ready to put into practice the slogan “Think globally, act locally.”