www.business-review.eu Business Review | October 2020
18 ENTREPRENEURSHIP
Startup investments to play big part in Romania’s economic recovery With the Romanian economy estimated to grow by 4 percent in 2021, partially recovering this year’s drop in output which is estimated at 6 percent, the entrepreneurial sector could support the growth trend by attracting fresh funding and generating new jobs in dynamic sectors ranging from tech to healthcare and e-commerce. By Ovidiu Posirca
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tartups’ growth potential will be important across Europe. The economy of the European Union will slip into
recession due to the coronavirus pandemic, lowering its GDP by 8.3 percent this year. In 2021, the EU economy will grow by 5.8 percent, according to Eurostat estimates. In the first half of 2020, venture capital investment remained resilient in Europe despite the economic contraction, but the outlook became rather uncertain as we moved into the second semester. Additional challenges could stem from the ongoing impact of the healthcare crisis and the issues related to Brexit, according to professional services firm KPMG. “Investors doubled down on companies expected to do very well in the short-term due to the impact of the pandemic, including those focused on e-commerce, healthtech, and remote education,” wrote the firm’s analysts in a report.
LOCAL STARTUPS CONTINUE SCALEUP EFFORTS INTO 2021 In H1, the median funding size provided by an angel or seed fund grew to USD 1.1 million, compared to USD 800,000 in 2019, according to the KPMG report. This type of financial support is critical for early stage startups. Gains were also recorded on funding rounds in later stages. Locally, funding conditions are good to support the growth of the startup market in 2021, suggests Vladimir Aninoiu, technology director within the consulting practice at Deloitte Romania. “Nevertheless, investments The capacity of startups to have a major contribution to economic growth is limited
in startups strongly depend on the economic recovery, and a slow recovery will negatively
