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Slovenia wants to become one of the most attractive environments for startup companies by 2030

State Secretary Matevž Frangež today presented the starting points of a Slovenian startup strategy at the Podim Conference – one of the most important technology and startup events in Europe. The goal of the strategy, which was created in cooperation with active stakeholders of the ecosystem, is to make Slovenia one of the most attractive environments for startup companies by 2030.

The strategy contains specific proposals in the five most important areas, specifically: a supportive environment for startup and scaleup companies, a new legal form of organisation for startup companies, a startup visa, the development of the venture capital market and a solution for exercising stock options.

“In startups, their innovative ideas and approaches, we see a way for dynamic economic progress. We believe in new products and solutions that will be the result of Slovenian know-how, innovation and design,” said State Secretary Matevž Frangež.

In terms of the key indicators that measure how friendly the business environment is to startup companies, Slovenia lags behind the European average, as it achieves only 23% of the startup standards of the European Startup Nations Alliance (ESNA). For this reason, the Ministry, in cooperation with the Start:up Slovenija initiative and active stakeholders of the Slovenian startup ecosystem, has drafted the starting points for the creation of a Slovenian startup strategy, which includes a thorough analysis of the situation and an overview of the best practices of the best startup ecosystems, a vision with ambitious goals for the Slovenian startup ecosystem by 2030, and has also defined proposed measures based on five strategic initiatives for realising this ambitious vision.

At today's presentation of the starting points of a Slovenian startup strategy, the State Secretary was joined by key stakeholders of the startup ecosystem: Nina Dremelj, Gregor Rebolj, dr. Iztok Seljak and Matej Rus.

Nina Dremelj of the Startup and Scaleup Companies Section of the Chamber of Commerce and Industry commented on the situation in Slovenia: “Slovenia lags behind some EU countries in terms of equity financing, which hampers the development of startup and scaleup companies. Due to the shortage of equity, which is not recognised as important by private investors, the state does not encourage this model of financing. This shortage, along with complicated incorporation procedures, hamper the development of domestic companies, which encourages their establishment in foreign countries, such as the US and the UK. The two most common forms of legal entities in Slovenia are not optimal for startups, which is why the Startup and Scaleup Companies Section proposes that the Companies Act be supplemented with a new form of legal entity - a non-public or lean joint-stock company - and incentives for investing in startup companies, modelled after other countries in the EU, be introduced. Slovenia needs to move up the ranking in terms of facilitating investments in startup companies compared to other EU member states.”

Dr. Iztok Seljak, the president of the Managers’ Association and the chairman of the management board of the company Hidria, added: “Slovenia is caught in the algorithm of a negative value system. There is a handbrake installed in the system and we are not capable of a serious development breakthrough. There is not enough self-confidence and ambition, which results in us drowning in mediocrity, and feeling negative envy makes us irresponsible towards ourselves and others. We do not cooperate with each other, but we are, instead, divisive. Startups as such and the Slovenian startup community are natural promoters of self-confidence, ambitiousness, responsibility and cooperation. The Managers’ Association, which promotes all these values, also runs the Ambitious Startup Ecosystem project as part of the PODVIG project. It is not only about establishing a startup environment that is at least comparable to the most propulsive external environment, but also about an innovative, advanced leap into creating competitive advantages for this segment, which is urgently needed in Slovenia.”

Some European countries already have excellent methods for attracting talent

The analysis of good practices abroad, which has several hundred pages, includes leading European countries that apply the existing solutions to provide an attractive business environment for the target group of technology companies. Some examples: the system of tax relief for investors in the UK, the Flex-Co hybrid legal form of organisation in Austria, the overview of the number and achievements of startup companies and the entire technology sector (jobs, created added value) in Estonia, the advanced optional reward system and the advanced system of startup visas for investors, entrepreneurs and employees in startups in Latvia and Portugal. Austria and Sweden have an effectively functioning publicly supported support environment system. Germany, Spain and Estonia have created a comprehensive startup strategy at the national level, with the latter setting an ambitious goal by 2030 for the technology sector to generate 30% of GDP and employ 10% of the active working population.

Ten times more investment in startups by 2030

The Ministry has also set ambitious goals to be attained by 2030, specifically:

  • That at least 476 startups per million residents will be created in Slovenia (twice as many as today),
  • that at least EUR 410 per capita will be invested in startups in Slovenia (ten times more than today),
  • that Slovenian startup and scaleup companies will draw funds from EIC programmes at least at an average rate,
  • that an effective system for measuring data on the number of startups, on the number of employees in startups and generated revenue and taxes paid will be established in Slovenia, and that year-on-year growth in the sector in terms of the specified indicators will be at least 25%,
  • that at least part of domestic ownership will be preserved in the mentioned companies and that at least part of their business and innovation functions will be retained in Slovenia.

In order to achieve these goals, the Ministry will strive to achieve the ESNA startup standards at a 69% rate (three times more than today) in the shortest possible time.

From ambitious goals to radical changes in five areas 

In order for Slovenia to be able to catch up with the best countries and achieve the set goals, it must greatly improve the business environment for innovative startup companies. It can only achieve this by making radical changes, as covered by five strategic initiatives:

  • a strong, accessible and inclusive support environment for content and financial support for startups,
  • a mechanism for attracting foreign high-tech talent (startup visa),
  • incentives for private individuals and pension funds to invest in venture capital,
  • an attractive model of optional rewarding of employees,
  • a new legal form of organisation of startup companies – the idea of a lean joint-stock company.

By implementing the above-mentioned changes, Slovenia will join startup- and talent-friendly countries and, above all, secure significantly faster economic development by increasing the proportion of high-tech companies in GDP.

State Secretary Frangež added: “With the starting points for a Slovenian startup strategy, we want to encourage public response. We want confirmation of the set vision, goals and key measures, and we want new ideas and opinions. Our ambitions are high: to achieve a breakthrough of Slovenian startups and change the Slovenian business landscape for the better by providing attractive conditions for their creation and growth, by strengthening the ecosystem and by having a new, ambitious and global market-oriented mindset.”

Investors also expressed their support for the realisation of the set vision. Gregor Rebolj of the Slovenian Technology Forum and the Silicon Gardens venture capital fund said: “In 2023, investment in Slovenian start-up companies dropped to EUR 81 million, which is 91% less than in the record year 2021 and an amount similar to that in 2014. Due to the economic situation, entrepreneurs prefer to grow more slowly with their own funds than seek investment, but at Silicon Gardens we would like to see more ambitious ventures. Investors from the Silicon Gardens fund share the vision of a high-tech Slovenia. To help the government realise this vision, we established the Slovenian Technology Forum (STF), which brings together high-tech companies. The STF's mission is to stimulate discussions and activities aimed at a new development model and Slovenia's transformation into a country that will train human resources and develop talent for the professions of the future.”

The Ministry's initiative is also welcomed by the supportive environment for startup and scaleup companies. Matej Rus, the head of Start:up Slovenija and the director of Tovarna Podjemov, noted: “What is not measured cannot be improved and changed. This is why it is so important to have accurate data on the startup ecosystem and its contribution to Slovenian society. At Start:up Slovenia, we have been actively monitoring, supporting and promoting the Slovenian startup ecosystem for two decades. The Podim Conference, which brings the crème de la crème of the European startup scene to Slovenia every year, is also part of our efforts, which we intend to strengthen in the future, together with the ecosystem, so such a decisive initiative of the Ministry of the Economy is more than welcome.”

About the Podim Conference

The Podim Conference is one of the most influential startup and technology events in Central and Eastern Europe, which once again networked and connected more than 1,000 participants in Maribor from 13 to 15 May 2024. The three-day event attracted 204 startups from 24 countries, 69 speakers from 17 countries, more than 80 venture capital funds and other types of private investors, and numerous entrepreneurs and business enthusiasts.