No-one could deny that the global recession has been felt keenly in Hungary. In all of Europe, the Hungarian worker is said to have the second gloomiest outlook only after the Greek. This is hardly the background you might associate with startups, venture capitalism and business incubators. However Budapest, the capital of Hungary is on its way to become a regional hub for start-ups, investors and incubators.
Much of this can be attributed to Peter Zaboji, an energetic and always debonair elder statesman figure with a lifetime of experience behind him, and his European Entrepreneurship Foundation, the EEF. Zaboji returned to his Hungarian homeland in 2008, and ever since then he has been a prime mover in establishing Budapest as truly a startup city. The EEF’s regular program of accelerator programmes, ‘e-breakfasts’, and business angel forums have reached out to a new generation of entrepreneurs. One of the EEF’s signal achievements was bringing Seedcamp to Budapest. Here’s what Seedcamp’s General Manager Kirsten Campbell had to say about it:
“Having invested in our first Hungarian startup Antavo we were excited to see more of the region’s talent. At Seedcamp Budapest in October last year we were joined by great companies, a really good showing of international mentors and super high energy throughout the day by everyone present. The icing on the cake was investing in two brilliant startups Futurelytics and Codeship. Our hosts set the bar high for future events and we certainly look forward to returning this year.”
Of course, while the EEF was the first, there are now several such business accelerators are operating in Budapest, including Colabs, a startup centre and ‘tech hub’. They are actively looking for promising startups and typically source investments of between 15 thousand and half a million euro for early stage companies. Another one is the newly launched iCatapult. They’re a Budapest based technology accelerator and business development company whose mission is to take European technologies to the global market: in particular the United States.
So much for incubators and accelerators, what of successful Hungarian entrepreneurs to emerge from this new hothouse environment? Let’s begin with Márton Anka, the co- founder of remote access software pioneer LogMeIn. LogMeIn’s corporate customers include 3M and IBM, and as this article is being completed, the Wall Street Journal reports LogMeIn have recorded a fourth quarter profit rise of 8.9 percent. Their headquarters are in Massachusetts, but they retain development centres in Budapest and Szeged deep in the Hungarian hinterland.
Meanwhile, the founder and CTO of Ustream, one Dr. Gyula Feher, still makes his home in the Carpathian basin. Ustream's technology was originally created because Feher and his colleagues wanted a way for soldiers stationed in Iraq to communicate with their families back home. These days however you can watch everything from cute animal channels to red carpet arrivals on their streaming site.
Prezi is another Hungarian web tech success story, born from an idea that seems artistically inspired: the ability to zoom in and out from an image during a presentation, to make storytelling more dynamic, compelling, even filmic. Prezi’s founders are Adam Somlai-Fischer, an architect and visual artist, Peter Halacsy, a scientist and Budapest University of Technology Professor, and Peter Arvai, self styled ‘serial entrepreneur’. All good, solidly dependable Hungarian names, while the company’s headquarters are split between San Franciso and Budapest.
It seems that Budapest is on the right path to becoming a regional hub, developing an ecosystem where Hungarian and international entrepreneurs, venture capitalists and other contributing actors can work together, to spawn successful new companies. So what’s the future for the city?
“Budapest is one of the most attractive metropolitan cities in Europe. It has a great tradition of being the natural hub of the CEE region. With the founders of Prezi, LogMeIn and UStream around, we are spoiled for great role models. Large German, French, British and American communities of all age groups live here, as do seasoned international managers of Hungarian descent. The mix of cultural backgrounds and skills provides a great resource for anyone who wants to build a global business out of here” - expressed Peter Zaboji.
It sounds inspiring and you have to hope the momentum will continue.
About the author
Scott Alexander Young - Scott Alexander Young is a creative director, producer, television scriptwriter, travel writer, actor, voice actor and raconteur who lives life to the full. His article first appeared in the March issue of Entrepreneur Country.
