Entrepreneurship Reality and Policy in Macedonia

Entrepreneurship reality and policy in Macedonia

Self-employment survival guide According to the Spanish law a self-employed person can be "any individual who performs habitually, personally, directly, on their own account and outside the scope of the direction and organization of another person, an economic or professional activity for a lucrative purpose, whether or not they are employed by employed persons."

The most usual is that the decision to be self-employed is taken freely by the worker, but there are some cases included in the Statute in which by law he is obliged to register as self-employed, as happens, for example, in the case of self-employed workers.

Advantages and disadvantages of being self-employed As we have seen, the most usual thing is that the decision to be self-employed is taken freely and it is not always the only alternative. One of the options can be to carry out a professional activity without doing it directly and on its own, but by creating a company, for example a Limited Liability Company. Each has its advantages and disadvantages.

Advantages of being self-employed   

It is a more appropriate business form for the operation of very small companies.

It is the option with less formalities and procedures necessary to start the activity and it’s cheaper than the constitution of a commercial company.

Although being self-employed has fiscal and accounting obligations, they are smaller and simpler than company’s obligations.

Disadvantages of being self-employed: 

  

The main one is that the responsibility of the self-employed person, as an entrepreneur, is unlimited, that is, he / she responds with his personal assets of the debts and obligations that arise in the exercise of his / her activity.

In addition to providing the resources to start the activity, the self-employed also has to attend to its management and administration.

If the self-employed person has no income, he will continue to be obliged to cover certain expenses, such as his fees in the Social Security self-employed regime.

When the autonomous activity generates a significant amount of benefits, as taxed as a natural person, you may have to pay more taxes than those paid by small companies.

Before signing up, make a business plan The decisions to register as self-employed, to form a mercantile society or to become a member of an already established company, are important. Sometimes it is not just about signing up, but the money you will invest in the project: constitution expenses, purchases, renting a place, etc. You can ask for the accumulated payment of unemployment benefits to finance expenses and Social Security contributions.

There is an instrument, called "Business Plan", which serves to put some order and detect in time if a project is unfeasible. It is necessary to take everything into account before embarking on the adventure. It is not about facing a blank sheet of paper, today there are excellent free online tools in which we can go simulating expenses and income so that the calculations are realistic and make a decision with the best information.

2

Procedures to start the activity as self-employed There are a series of mandatory procedures in any case you have to carry out: 

 







Register in the Treasury: Before even doing any procedure with Social Security, it is necessary to register in the Census of employers in the Tax Agency (AEAT). In this way it is communicated that a professional activity will begin.

Affiliation to Social Security: If you did not previously have an affiliate number, you must obtain it from the General Treasury of the Social Security (TGSS).

Register for the Self-employed Regime: This procedure is also done in the Treasury (TGSS). Keep in mind that also, if you meet certain requirements, you can apply for the flat rate for self-employed, so you only pay 50 euros per month for the first twelve months.

It is essential that before going to Social Security study all the bonuses that are available, since this is the time to ask for them. If you request them later, when you have already registered, you will not be able to apply them.

You must also take into account if you deserve or not pay the so-called "unemployment of the self-employed", an additional fee in your quote that will allow you to have a benefit in case of cessation of activity.

Register personal files in the Spanish Data Protection Agency (AGPD). From the moment you go to manage personal data, such as customers or suppliers, you must have the file registered. The procedure is carried out from the Agency's website.

If you are going to hire workers; As a self-employed, you can hire workers. In this case, you must complete these procedures:     

Registration of the company, affiliation and registration of workers in the corresponding Social Security scheme.

Communication of opening of the work center in the Ministry of Labor of the corresponding Autonomous Community.

Registration in the real estate tax at the City Hall where the company is located.

Obtaining the labour calendar in the Provincial Labour Inspection.

Registration of employment contracts in the Public State Employment Service (SEPE).

Depending on the activity you are going to do: 

 

Obtain in your town hall the licenses of facilities and works, activity licenses and operating licenses. They are necessary depending on the activity, for example if it takes place in a commercial space, an office or a warehouse.

Enrol in official records that are mandatory for each activity.

If you are going to work as a freelancer for a single client, on which at least 75% of your income will depend, there is a legal regime that provides you with greater protection: the economically dependent self-employed worker (TRADE).

Other recommended steps: 

Obtain the digital certificate: The electronic signature is essential to be able to quickly and without traveling manage all kinds of procedures before the Tax Agency, the Social Security, the Public Employment Service, the regional and municipal administration and many public and private institutions.

3

 

Register your trademarks, distinctive signs, trade name in the Spanish Patent and Trademark Office.

Counts with advice: The beginnings of activity are always difficult and you have to control all expenses, but if there is one of them that is justified, it is the small monthly fee for a consultancy that helps you with accounting and tax obligations.

Small and medium companies, the core of Spanish business

In Spain, 99% of all companies are SMEs and globally it’s estimated that thirty percent of GDP is generated by them. Whether offering goods and services or demanding products, they constitute the backbone for all local economies and employmentgeneration.

Thanks to the fact that they absorb a significant portion of the economically active population, with reduced labour costs per worker, they contribute to stability in the labour market.

SMEs have great flexibility to adapt to the constant changes in the market and to undertake innovative projects due to their size.

In contrast to large companies, they promote individualization over standardization, although they also serve as an auxiliary fabric for them as minor subcontracted entities that provide large companies with maximization of time and cost reductions.

In an SME the value chain is composed of few links and, therefore, the lack of productivity of one can slow down the entire company. The commitment of employees and the knowledge that companies invest resources in their well-being becomes more important than in other business contexts.

The profile of the Spanish SMEs coincides with the European one. The European Commission defined valid criteria for the whole Community more than 10 years ago. The SME is a company with less than 250 employees and with an annual turnover equal to or less than 50 million euros.

In Spain, the bulk of the SME is concentrated in the microenterprise, with up to 9 employees, which account for just over one million. The explanation lies in the very constitution of our economy, very dependent on the services sector, especially tourism.

One of the main consequences of the crisis in Europe has been the increase in restrictions on financing: banks have stopped lending and if they have kept the tap open, it has been with droppers and higher interest rates. This interruption of the credit flow has been especially stressed with SMEs and more specifically with the smaller ones, so abundant in our country. This scenario has had two immediate consequences: the first, the disappearance of many small businesses.

According to data from the General Council of Economists, about 600,000 SMEs and microSMEs perished in Spain in the last decade. The second is the entry into the scene of alternative forms of financing, such as 'crowdfunding' or 'Business Angels', or the use of solutions to control cash flows and financing needs.

Aware of the importance of the diversification and internationalization of the business, small and medium-sized companies consider the exit abroad to be a priority in their strategic plans. Such is the case that Spanish companies already invoice more than 60% outside our borders. According to the Ministry of Industry, with data from 2017, 80% of companies carry out their activity in the 4

services sector and, within this, 24.3% refers to trade; for its part, construction accounts for 13.6%, and industry, 6.4%.

Considering the sectorial distribution of Spanish SMEs, some differences are observed regarding their constitution. For example, 85.6% of industrial companies are micro-enterprises (1-9 workers), while 60% of construction companies and 50% of commercial companies are comprised of micro-enterprises without employees. SMEs have been and are the big generators of employment in our country, above 80% of the total.

The General Subdirectorate of Support for SMEs underlines that companies with up to 9 employees account for 30% of national employment, and those that account for up to 49 workers, 17%. However, since the beginning of the crisis, in 2008, employment has fallen by 23.5% in small companies, 16% in medium-sized companies and 7.47% in larger companies. During this time, almost 600,000 SMEs and more than 400,000 self-employed workers have disappeared. The sector of retail trade, distribution and construction have been the biggest job destroyers in absolute terms. Spanish companies registered in the Social Security. In the last years, the self-employed has become the maximum representative of the Spanish SME. As a natural person, it is the predominant form of creation of companies, without employees in their charge, followed by the limited company.

5

SOCIAL ENTREPRENEURSHIP IN MACEDONIA THROUGH THE EYES OF:

Arno; Social Impact award; Sozdadi.mk

STRATEGY FOR INNOVATION OF MACEDONIA 2011 DONEC QUIS NUNC

ENTREPRENEURSHIP PERFORMANCES OF MACEDONIA COUNTRY AND WHAT CAN BE DONE TO IMPROVE IT

ENTREPRENEURSHIP ENABLERS IN MACEDONIA

ENTREPRENEURSHIP

6

Entrepreneurship Entrepreneurship in the Republic of Macedonia ........................................... 8 Macedonia factsheet ..........................................................................................................................8 Strategy for innovation of the Republic of Macedonia .................................................................. 10 SWOT analysis of the Macedonian startup and innovation ecosystem ....................................... 12 What’s next for the Macedonian entrepreneurship ecosystem? .................................................... 13 What instruments do entrepreneurs in Macedonia have on their disposal. ................................. 13

Social entrepreneurship in Macedonia.......................................................... 16 Social Impact Award....................................................................................................................... 16 Case study www.sozdadi.mk, How the winners of SIA Award 2017 is changing the sociao economical context in Macedonia .................................................................................................. 18 Arno and case study - coolinari.mk- Social enterprise who is changing the way specialised schools in Macedonia are offering their services to the business sector........................................ 19

Reference ...................................................................................................... 24

Made by: Igor Izotov

7

Entrepreneurship in the Republic of Macedonia Macedonia factsheet Macedonia is a landlocked country located in the Balkan Peninsula.

According to the world bank Macedonia is ranked in upper middle income countries with GDP per capita of 5,237.15 $ with total population of 2.081 Million. The unemployment rate stands at 28.4% according the state employment agency, however this number is doubtable as many people work in grey economy.

In general the country has experience growth of it’s GDP with the major increases around the periods of 92 till 2000 and from 2001 till 2010 , when the annual gross domestic product (GDP) growth rate averaged 7.63%. Nevertheless from there on there is a tendency of decrease with annual growth rate of 2.4% in 2017.

The Global Competitiveness Index 1 2016-2017, which defines competitiveness as the set of institutions, policies, and factors that determine the level of productivity of a country and covers over 100 indicators, divided in 12 pillars, ranks Macedonia as 68 country out of 138 countries taken in consideration for this index. The figure bellow, taken from GCI report 2016-2017, shows all 12 pillars and ranking of the country in each of them.

The same index puts Macedonia in the stage 2 or efficiency-driven country, stage where countries must begin to develop more efficient production processes and increase product quality because wages have risen and they cannot increase prices. At this stage, competitiveness is increasingly driven by higher education and training, efficient goods markets, well-functioning labor markets, developed financial markets, the ability to harness the benefits of existing technologies, and a large domestic or foreign market.

2

The global innovation index (GII) for 2016 ranks Macedonia 58th out of 142 countries whereas the annual Innovation Union Scoreboard (IUS), which provides a comparative assessment of the research and innovation performance of European countries and the relative strengths and weaknesses of their research and innovation

1 2

“This country could be extremely attractive to digital nomads and international entrepreneurs due to a low cost of living associated with high-quality commodities.�

Franck Nouyrigat, co-founder @Startup Weekend

https://www.weforum.org/reports/the-global-competitiveness-report-2017-2018 The Global Innovation Index (GII) is an annual ranking of countries by their capacity for, and success in, innovation.

8

systems, ranks Macedonia as a modest innovative country 4 with bellow average performances.

Compared to neighboring countries, Macedonia has largely underperformed in terms of R&D expenditures.

snapshot from https://www.weforum.org/reports/the-global-competitiveness-report-2016-2017

In terms of startup and entrepreneurial activity Macedonia is far behind other similar countries like Slovenia, Serbia, Latvia, Iceland and Estonia. As seen in the table bellow3 which highlights population, number of startups on angel list and GDP per capita, Macedonia is able to produce 3 times the startups it currently has. Ultimately, the investments in the startup eco-system will lead to job creation and increase of GDP per capita.

Table1: Franck Nouyrigatâ€&#x;s report on the Macedonian startup ecosystem for SecoEP project 2016

3

Franck Nouyrigat’s report on the Macedonian startup ecosystem for SecoEP project 2016

9

Table 2: Franck Nouyrigatâ€&#x;s report on the Macedonian startup ecosystem for SecoEP project 2016

Entrepreneurship in early phase in Macedonia is very low at 6.63%, and had tendency to decrease in comparison with previous years. The rate of established business in the county varies, but in general it is on the average of 7%.

Nonetheless, the current state in the country should not be seen as negative, instead, it should be observed as opportunity for potential business support organisations and investors, having in mind that growth in the sector must happen in the upcoming years.

Strategy for innovation of the Republic of Macedonia The situation of innovation and entrepreneurship in Macedonia in 2018 looks promising. On strategic level the government has initiated national committee for innovation and entrepreneurship under the direct supervision of the prime-minister of the country, whereas the deputy minister for economic affairs works on operative level.

There is a sector for innovative support within SKILLS 4 project of the World bank and is in the later stages of implementation.

Furthermore, the national innovative strategy 2012 - 20205 with action plan was adopted and is being implemented with small delays. Under this strategy a national fund for innovation and technological development6 was established in 2014. In February 2018 the Fund for innovation finished itâ€&#x;s fourth call for supporting innovative companies and startups. The total amount of money being spend on 4

http://www.mon.gov.mk/images/documents/SDIS_project/01814_ToR_TA_for_curriculums_for_innovation_and_enterpreneurship_NOL_22_Dec_14.pdf 5 http://www.seecel.hr/UserDocsImages/Documents/InnovationStrategy%20EN%20version.pdf 6 www.fitr.mk

10

innovative entrepreneurial project exceeds 4 million and total 60 companies have received investment from the fund so far.

On the other hand the National strategy Entrepreneurial learning 2014 - 20207. The Innovation Strategy pays particular attention to increasing the innovative capabilities of SMEs complements the existing Government programme on Research and development. This Strategy takes into account the countryâ€&#x;s current state of development to ensure that policies to promote innovation are both focused and relevant for the country given that what works well in the context of an elaborate research and innovation system may not be so effective in the Republic of Macedonia In the previous years additional sources of funding become available for Macedonian startups and SME companies from institutional donors such as the World Bank, European Investment Bank which have culminated with significant governmental funding for equipping 80 laboratories in public institutions such as universities, hospitals, state institutes totaling 60 million euros.

On educational level courses like Entrepreneurship, small business management, innovation management etc are present in the curricula of the state Universities especially at the economic and technical facilitates. However there is no specialized programs and most of the professionals working on the topic got their education abroad.

7

http://www.mon.gov.mk/images/Artic-zDOC/Macedonian%20EL%20Strategy%202014-2020%20ENG%202.12.2014.pdf

11

SWOT analysis of the Macedonian startup and innovation ecosystem The following paragraph summarizes the Strengths, Weaknesses, Opportunities and Threats of the Macedonian startup and innovation ecosystem.

1. The state fund for innovation has more money to give than applications for those money 2. New programming IPA funds are directed to education, research and innovation 3. Horizon 2020 program are under-utilised with 7Million $ 4. Faster access to money via establishing of new financial platforms (Business angel and private equity funds) 5. Macedonian diaspora is under-utilised 6. Continuous donor-support from various entities (USAID;Swissconntact) in terms of infrastructure and capacity building of entrepreneurial enablers

1. Strong commitment from the government to build innovation and entrepreneurial society 2. Series of strategies adopted by the government that complement the entrepreneurial ecosystem 3. Doing business ranks Macedonia as the 11th country in the world by the ease of doing business 4. In the country entity can open a company in less than 24h 5. Relatively cheap, yet educated labor force (highly skilled workforce).

6. Increasing participation ofSMEs to EU- funded projects 7. Closeness to European markets

1. Lack of institutional dialogue between key stakeholders in the entrepreneurial eco-system 2. Lack of monitoring system that would evaluate impact of interventions, laws and policies.

3. No dialogue between private companies and the industry and entrepreneurs and startups 4. Very limited R&D investment from the business side 5. High unemployment, low productivity 6. University Research is limited by scope and numbers 12 7. Very limited access to finance for SMEs and start-ups

Strengths

Weaknesses

Opportunities

1. Skilled workforce leaves the country (brain drain) 2. Not enough skilled entrepreneurs to implement the Innovation Strategy 3. The number of qualified researchers in both the academia and business sector has been steadily decreasing.

4. Business angel network not active in support of entrepreneurs 5. No private equity funds available for entrepreneurs 6. Not enough senior level programers to implement digital and software strategies.

Threats

Whatâ€&#x;s next for the Macedonian entrepreneurship ecosystem?

According to various entities and the research conducted prior, all actors in entrepreneurial ecosystem in Macedonia should focus on 5 strategic topics in the following period: 1. Strengthening the entrepreneurial learning in formal education - openingspecialised institutes, that will teach and research the entrepreneurship performance and train future entrepreneurs and innovators on bachelor, master and phd level. This should be done in addition to putting compulsory subjects both on primary and secondary education.

2. Intensifying the creation of additional support mechanisms like hubs, incubators, accelerators, technology parks, startup centres (both in formal and in/non-formal education and learning).

The national strategy for innovation 2012-2020 plans opening of 3 private-state accelerators with $1.5Mil financing from the government.

3. Increase the capacities and investment funds for development of startups, innovation and technology development.

4. Strengthen or open business angel networks and introduce new Venture capital and private equity funds. The innovation strategy 2012-2020 plans opening a state equity/mezzanine financing fund , that will support later stage companies and startups.

5. Link with international networks and organisations, in order to get bast case practices.

What instruments do entrepreneurs in Macedonia have on their disposal.

What kinds of businesses can be started with very little capital and what types of low-budget resources are available to those who are interested in pursuing a new line of work is difficult to be understood in Macedonia, due to the infancy of the entrepreneurship and startup ecosystem that is still developing. The smart specialization process and entrepreneurial thinking courses are about to be implemented in the state universities. However the following table was created to work as a road map to new entrepreneurs in Macedonia and moreover, we have asked various Entrepreneurs 13

to try explaining us this question. The following table summaries all the institutions, think thanks, organisations, investment funds and so called entrepreneurial enablers that work and offer some kind of help to early stage startups, entrepreneurs, innovators, later stage startups and companies.

There might be other actors but this are the ones that have made impact in the previous period on the Macedonian entrepreneurship ecosystem.

Organization (web page)

What they offer

Business Startup Center UKIM

Mentorship support

Seavus Incubator

Co-working space, office and They are backed by the biggest ICT Incubator space; Mentorship company in Macedonia. and start up support

and

Additional Comments start

up The University St. Cyril and Methodius Business Start-up Centre for students from the University

The Agency for promotion of Support of entrepreneurship – The Agency for promotion of entrepreneurship no special entrepreneurship of the Republic of Macedonia represents a central state institution for support of the entrepreneurship and development of small business in the Republic of Macedonia.

MASIT

IT chamber that offers support The Macedonian Chamber of to IT companies Information and Communication Technologies — MASIT was founded in 2000 as an initiative of the top fifteen Macedonian IT companies and is operating as an Association within the Economic Chamber of Macedonia.

Youth Entrepreneurship Service Co-working space, office and Business incubator with own office YES - Incubator Incubator space; Mentorship space with of more than 600m2 in and start up support Gazi Baba, Skopje.

The organisation is also known as YES Business Incubator Foundation for management and Foundation that is supporting Closely connected industrial research - MIR entrepreneurship research Incubator

with

YES

Business Startup Center Bitola

Consultation, co-working status of this organisation in space, and micro credits for unknown at this moment. small and medium innovative companies.

CEED Macedonia

Center for executive entrepreneurship education Mentorship and networking organisation for more advanced startup companies

14

Part of the entrepreneurial centers network in Southeast Europe.As part of the CEED HUB Skopje there is business angel club that can provide ceed investment to interested entrepreneurs

Social innovation Lab

Organisation supporting Social Supported by UNDP entrepreneurship project at the Electro technical faculties in Skopje

New Man's Business Academy

Business accelerator, offering organisers of NASA space apps courses and mentorship for challenge- hackathone startups

SEAF – Small assistance funds

enterprise Investment fund for more Closely connected with CEED and advanced SME and startups MFRP. providing risk investments in more advanced companies

Small Investment Fund SIF

Investment fund

Established in July 2007 and until now has made three investments in Macedonia. Current stage unknown

Macedonian Enterprise Think tank; investment fund The Macedonian Enterprise Development Foundation with no investments Development Foundation was founded in 1998 as a result of a collaboration between the Macedonian Center for International Cooperation and the Kingdom of the Netherlands.

Fond for innovation and State Investment fund Technology development

South Venture capital

Investing in pre-seed and seed stage. World bank money to be spend on improving the innovation and competitiveness of the country

Only Venture capital fund VC fund established by the EIB in opened to support startup’s accordance with the Enterprise growth stage Innovation Fund (ENIF). Investing in later stage startups in Western Balkans

The National Centre for Think thank organization for Organisers of “Get in the ring Development of Innovation and entrepreneurship policies competition” Entrepreneurial Learning- NCDIEL SWT

Startup academy, pre- Present with programs and accelration programs for early activities in Strumica, Skopje and stage startups Bitola

Hub Skopje

Co-working space, office and Offering acceleration and preIncubator space; Mentorship acceleration programs to startups and start up support and SMEs. Backed by USAID and Swiss embassy

Superfounders

organising startup around Bal kans

15

events organisers forum

of

Balkan

venture

CEFE

Entrepreneurship courses and NGO offering entrepreneurship support courses

Public room

Co-working space + restaurant; “coffee with an expert” events are some startup events are happening at this place happening here

Let’s fund it

crowdfunding platform

Opened and operated by SWT

Coffice

Co-working space

First co-working space opened in 2015. 13 co-working places available

Veloso Hub

ICT outsourcing company with Organizing meetups hackathon space

Skopje Lab

centre for social innovation and operated by UNDP and the city of social policies of city of Skopje Skopje

SEEU Tech Park – Tetovo

Co-working space, office space, Offering wide range of services to mentorship advice companies, startups and SMEs.

Social entrepreneurship in Macedonia Social entrepreneurship in Macedonia is pretty new. Till now there is not a single scientific or academic paper written about it, nor the impact social entrepreneurship has made in Macedonia. In the following pages a dialogue will be opened with the actors in the Social entrepreneurship scene in Macedonia, we will see how social entrepreneurship is developing and developed through the eyes of the organisations that made Social Entrepreneurship in Macedonia what it is today.

Social Impact Award One of those organisations that single handedly changed the view of Social entrepreneurship in Macedonia is the Social Impact award, implemented by Social Impact Lab and Mladiinfo International. The social impact award supports young innovators that want to build social enterprises that address the challenging issues in the communities. They are hosting events and workshops to raise awareness for social entrepreneurship, teach the necessary skills to innovators from idea stage to promising ventures, provide access to global network of mentors and promote the best teams in international conferences. Social Impact award is present in more than 20 countries and regions and today we have the coordinator of the award for Macedonia Ms Marija Matovska to tell us something more about SIA and the impact it has made on the lives of social entrepreneurs in Macedonia.

1. Hello Ms Matovska. Can you tell us something more about Social Impact award on global and local level. If I m not mistaken it started as an initiative at the WU University in Vienna but now has grown to a global social enterprises enabler?

16

Marija: The mission of the Social Impact Award (SIA) is to offer to young people and students one entrepreneurial journey that will make social difference. Established by the Erste Foundation, Impact Hub Vienna and Vienna University of Economic and business in 2009, SIA promotes the knowledge and practice the social entrepreneurship among youth in Europe and beyond. The program achieves its mission by raising awareness about social entrepreneurship, offering an educational program, giving access to peers and professionals and directly supporting the most promising ventures. In 2017, the SIA family was consisted of 18 different countries located in Europe, Eurasia and MEDA region. The most interesting component is that all 6 Western Balkan countries (Macedonia, Albania, Kosovo, Serbia, Bosnia and Herzegovina and Montenegro) are now part of this international initiative. Mladiinfo International and Social Impac Lab started the coordination of the Award in Macedonia in 2015. Ever since we worked on the educational component, realized in the six different cities: Skopje, Tetovo, Gostivar, Ohrid, Bitola and Stip.

The participants of the workshops had the opportunity to know their basics of social entrepreneurship to develop their business ideas from the beginning, and bring them on stage where they can be implemented. During the summer period, every year, mentoring is taking place. With the help of the jury three winning ideas are selected. The total prize fund in Macedonia is 6000 euros, a trip to International SIA Summit for the best teams, mentoring, incubation period and many other opportunities.

2. So you are present in many countries and territories. Can you tell us from your experience the differences that entrepreneurs in all this countries where SIA is present are facing?

Marija: There are of course many different local realities. The cultural norms, mentality, behavior of people, organizational and legislation structures are influencing on the development of the ideas of the young people. You can find countries where they have better educational system, where entrepreneurship is part of the official school curricula from a very early age. In many countries there is more developed eco system for social entrepreneurship, including the wellestablished academia (as mentioned above), very active civil society organizations, business sector that is supportive, proper legislation, access to finance etc. That actually can make a difference in the mindset and the entrepreneurial spirit among the young people. They can be more ready to detect social challenge, to grasp the opportunity, to develop business model around the issue they are passionate about… But still, there are many points in which the young people are the same. They are eager to collaborate, tackle the social challenges in the local realities and no matter how cliché it might sound…to really change the world.

3. What are some good case practices from this award. I know in the last editions of the award the winning teams were solving social problems ranging from solar power plants to food waste management to pet shelters. Where are they now?

Marija: Talking about 2017 in Macedonia we had 3 winning solutions that were awarded with money and one as we are calling Community award that received additional mentoring support.

In the SIA family we don’t limit the creativity of the young people, we let them explore the opportunities that are out there and find the thing they are most passionate about. That’s why 17

we have so many different areas the young people are active in. The winners from last year covered the issues of unemployment, waste management (food and textile), street dogs… They worked with our team for a year, starting from participating in the workshops, incubation and mentoring, participation in the International SIA Summit…Now I can proudly say that all of they developed the concepts even more. Now, they are all part of our programs foe early start ups for investment readiness. They work on development of their on line platforms, physical facilities, prototypes… And the most important their motivation and dedication is still very high.

4. How do you see the future of social entrepreneurs in Macedonia? Do you think we will solve all our social problems?

Marija: Hahah… hard to say…There will be always different social problems and challenges. The sociality is continuously changing and reshaping. It‟s a bit unrealistic to think that we are able to solve all social challenges. The most important thing is to build sustainable structures that will be resilient enough to give proper response to the changing environment.

In Macedonia today there are so many structural and serious challenges: democracy, rule of law, inter – ethnic situation, corruption, high unemployment rates, domestic private sector, difficult access to finance, bad management of public finances and constantly growing public debt, skill gap, young people leaving the country…In this context the social entrepreneurship can be seen as a viable path for the young people and all citizens in general. The social entrepreneurship should serve as corrective factor to many challenges in the society and as a career opportunity for the people. The social entrepreneurship in the country is developing, along with the whole eco system. But there are still some things that must be done immediately, like: better legislation, strategies, actions plans, more funding opportunities, improved capacities of the ventures, more skilled mentors and better networking and interconnection among all relevant players.

5. What does the future hold for SIA? I would say growth. SIA this year is expanding on different continents and regions (such as East Africa), meaning that our social entrepreneurs will have opportunities for different exchanges of knowledge, skills and realities that I believe will foster their creativity and motivation. As for SIA Macedonia we are having the opening on February 22nd. I hope that we will have even better application this year and bigger support from the rest of the community.

Case study www.sozdadi.mk, How the winners of SIA Award 2017 is changing the sociao economical context in Macedonia Sozdadi.mk is the winning team of this year‟s Social impact award. Ilina Veljanovska the founder of sozdadi.mk is an inspirational young person full with enthusiasm about social entrepreneurship and solving problems that impact us all. This was more than a reason to sit down with her and hear her story.

1. Hello Ilina. Can you please tell us you story of sozdadi.mk and how you got to the place you are now?

18

Ilina: I am a firm believer in the digital world and expressing creativity in today‟s busy corporate oriented society. Sozdadi.com is community oriented and he idea behind Sozdadi.com is simple - i decided to put together both my love towards creativity and my wish to support small businesses and regional entrepreneurs .

Sozdadi.com is designed to combat unemployment by using strategies that focus on creating new jobs and provide effective distributive channels, promotion, modern design for E-shops, simplicity and connection. The mission of the platform is to reimagine commerce in ways that build a more fulfilling and lasting world. We are committed to using the power of business to create a better world through our platform, our members, our employees and the communities we serve.

You may have heard the saying, “Give a man a fish, and he can eat for a day; teach a man to fish and he will eat for a lifetime.” I would argue, “Give a man the tools and resources to create a fishing business, and his whole village can thrive for generations.”

2. Is the entrepreneurship drive something that you were born with or you just saw an problem that needed fixing?

Ilina: I believe that all entrepreneurs are born into this world with a drive and need to succeed that most of humanity lacks, but they are shaped through education, experience and mentorship.

3. How has SIA helped you grow your social business?

Ilina: SIA it was a life-changing experience for me, as a young entrepreneur. Social Impact Award does support young innovators in building social enterprises that address the most challenging issues of our time. We did played and experimented, we dream big, we work hard.

4. What are the future plans after SIA Ilina: Creating a supportive, non-competitive atmosphere where sellers can not only build relationships with customers, but with each other , in order to further support the handmade and shop local movement! We believe in providing the best experience and the best services for our clients!

Arno and case study - coolinari.mk- Social enterprise who is changing the way specialised schools in Macedonia are offering their services to the business sector Another bright example about organization that supports social entrepreneurship and innovation, green ideas and social policy improvements is ARNO 8 . Arno is an Organization for Social Innovation established in the Macedonian civil landscape with special mission of development and implementation of social innovation and promotion of new options and contemporary technological approaches for society change. Arno was created on the basis of inspiration and need for change. Arno‟s president Irena Janevska believes that with new interventions and social

8

http://www.arno.org.mk

19

innovation, can make our world a better place. Based in Skopje, but always on the move around the Globe, I said down with Irena to hear her voice of social change and innovation.

1. Irina, You just come back from Taiwan to explore their social entrepreneurs model, tell us something more about this experience?

Irina: In January 2018 I was invited to the Technical Visit to Taiwan by the EBRD who works on upcoming project on Social Entrepreneurship which will be implemented in partnership with the Taiwan Business-EBRD Technical Cooperation Fund. Their project is aimed at promoting the market development of social enterprises in the Western Balkans and Croatia, by sharing experiences and best practices with a well-developed and functioning ecosystem for social enterprises like the Taiwanese one.

And, indeed in Taiwan we have been exposed to amazing stories of Social Enterprises and we have seen such strong devotion by the Taiwanese government to the support of the infrastructure for SE. The 3-day technical visit to Taipei was very important for me, because it came in perfect timing in my life. Being strong advocate for SE in Macedonia, I‟ve been losing voice and motivation in the past moths since its very complex ecosystem for moving from theory to practice: establishing fully operational social enterprise.

Promoting social enterprises in Taiwan is a top priority of the government .To create an ecosystem that nurtures innovation, growth of start-up businesses and the development of social enterprises in Taiwan, the government launched the Social Enterprises Action Plan in 2014 and invested 5 million EUR in the following three years to implement four major tasks in “deregulation, networking, financing and incubation.”

With the visit we have seen some of the fruits of this Action Plan.

During the visit, we‟ve visited different SEs and we have received presentations by different stakeholders that were powerful. I can pick few examples that made strong impression on me.

The first one would be the Taipei SE Square which is the 1st city-owned building both in Taiwan that aims at facilitating disability employment and social enterprises. There I was personally impressed by the story of Flow. Flow is the first social enterprise providing Building Information Modeling (BIM) services to construction and architecture design companies. It is a new business models developed to provide job alternatives to people with disability.

Another presentation from OurCityLove was impressive too. They are Social Enterprise that have created cloud-based platform that links data containing wheelchair- and disabledfriendly restaurants, transport and other facilities. Their aim is to create an inclusive, convenient and friendly environment for people to live in now and in the future.

During the visit we visited one of the restaurants of the Children Are Us Foundation which is famous in Taiwan for operating bakeries and restaurants that employ people with intellectual 20

disabilities. The first Children Are Us bakery opened in Kaohsiung city in 1997, and the Foundation has since expanded, opening other branches in Taipei city and Hsinchu city.

Taiwan's economic development in the past 3 decades is impressive and technical education and economic development are closely linked together to create an economic miracle, as they state.

Their government has placed great emphasis on Technological and Vocational Education (TVE).

As a result, TVE has contributed greatly to Taiwan's economic prosperity over the years.

For me the biggest take-out was the visit to the Hujiang High School which is VET school with 62 years of tradition. Aside from the other technical departments, we have seen the fully equipped rooms for the future chefs, and since I have the personal story of Coolinari for me this was the biggest ”A-ha“ moment. We must invest in VET education. And the government has the crucial role in taking strong steps for it. In Macedonia it‟s sad to see the state of VET. This two contrasting realities really hit my mind.

2. Irina can tell us something more about the initiative ARNO that you founded and successfully implementing in Macedonia the previous 4 years?

Irina: ARNO is a story. The beginning of this story is quite interesting. It starts from friends that wanted to use IT to make social good (and were about to register private entity) but then shifts to the concept of social innovation in general. The name is abbreviation that in Macedonians means “good”. We had funny challenges to register the organization with its full name “Association for Development of New Options” because the central registry officials asked if we were registering a political party (lol). Thus we had to put in front “Organization for…something.” and after going in circles and not giving up on our branded name we realized that we‟ll focus on social innovation and put it in front. This decision was not easy. It‟s demanding to have the word “innovation”. It requires full dedication to new approaches and bit more research to justify all of our current and future projects and their social impacts.

In the past 4 years we have tried and we are still not giving up on making positive social changes.

As socially innovative organization ARNO has conducted projects and initiatives that highlight its commitment and ability to innovate to respond to social problems. Immediately after our very first project the organization became recognized as groundbreaking leader in the field of Social Entrepreneurship . In 2015, the project COOLINARY 2.0 was Awarded with Social Impact Award, media constantly contacts ARNO on information on Social Entrepreneurship and promotion of VET. One of the chefs from Coolinary received the USAID CEP Award for Individual Activists, and we can surely say we mostly love the happy human stories we create.

In March 2017 ARNO became implementing partner of the UNFPA CO for the youth component.

ARNO is also recognized as promoter of the UN agenda for sustainable development. In October 2017 , ARNO organized the first Men Fair with Workshops “Men Cook”, “Men Iron” and “Shadow theatre for dads and kids” and promoted the concept of engaging men and boys for gender equality. The MenEngage campaign got lot of public attention and we really love how we have opened a debate about the division of roles in the home.

21

Now we have an ongoing project tilted as Students Today-Responsible Entrepreneurs Tomorrow funded by the Erasmus + program. The project focuses on delivering tailored programs for promotion of Social Entrepreneurship and Corporate Social Responsibility to high school students that are enrolled in the school subject “Entrepreneurship” in three countries (Macedonia, Croatia and Lithuania). It‟s really rewarding to see how young people can learn and be inspired. We really believe that we can contribute to better future by educating youngsters on ethics and philanthropy.

If they are the future CEO‟s they should know how to make strategic donations to help their communities, or if they are business leaders they should know of the concept of SE and maybe establish SEs instead of classic private companies that are mainly profit-oriented.

3. How to you help social entrepreneurs in Macedonia?

Irina: Since 2015 ARNO is administering the National Contest for Green Ideas known in Macedonia as “Philanthropy through Green Ideas” and is proud on the winning ideas at the Regional Contest: First cooperative of organic consumers “Nasha dobra zemja” (in 2015) , the initiative for reparation of old furniture that has grown into a small business “SPIN” run by a young architect (2016), the platform for sales and donation of leftover food from catering facilities “Food for Everyone”(2017), the green illusionist Kristian Shopov that raises awareness and educates through “ Eco-Illusions” (2017).

Philanthropy for Green Ideas is an Annual Competition that seeks to support the development of local and sustainable small business ideas in the Western Balkans. The contest works through structured and verified criteria and it is an initiative designed to reach out to the most marginalized rural areas and to inspire and encourage more communities, groups and individuals that have original and innovative ideas to start small, green businesses. The criteria in the Call are very much close to the basic values of Social Entrepreneurship and thus we believe that with this Competition we do help citizens in Macedonia to think and create small social business.

With this contest we have these 4 winners that we are very proud of. They are not projects; they are sustainable entities and “dreams come true” small businesses, which, we can call “social” because of the strong social and environmental component.

4. Can you tell us something more about coolinari.mk this first successful social entrepreneurship that you are ?

Irina: Having a job and the income which comes from it, is crucial to young people's well-being and belonging. Students from the VET sector, especially one from the low image gastronomy school face barriers to employment. Any one barrier, such as a low motivation, lack of experience, limited English language proficiency might only be a temporary setback. Combined however, they can make it almost impossible to find descent work. The result is that despite desire for work they

22

remain long-term unemployed or they work at other positions remaining not integrated in the society.

In 2014, inspired by the power of change in VET and combining it with SE, we started cooperating with the VET School “Lazar Tanev” and we had great IT outputs: 2 webpages and 2 mobile apps (www.mojketering.mk and www.coolinari.mk ). Than we won the Social Impact Award (2015) and we were first in the country to organize and sell Cooking Classes. We sold the Cooking Classes to the general public, we got lot of publicity and we got new generation of 20 youth chefs that we included in the program. We made profit of approx.

500 euros and we reinvested it in the student chefs: through tailored program: they got workshops on writing CV, use of social media to self-promote, professional photos for CV and tons of other activities.

Why we do all of this? Because VET has terrible image in the country, student go to school to get only diploma and remain without skills, they are not motivated to work in their profession. The most sad and disturbing fact is that after they finish school they don‟t work as chefs but go to the army, work in betting stores, as waiters (because of the tip) . And by this decision they remain low on the labor market or unemployed, while the irony is that every second job advertisement in the country is “we hire a chef” and cooking is a world trend (many tv shows now also in the Macedonian media space).

We have a successful track record of enabling VET students to boost their motivation for cooking and gain meaningful employment. We believe this is due to how our training differs from traditional models. i.e. by: 1. Providing flexible training that meets individual needs.(We try everything to be COOL for them, thus our slogan is “Its cool to be coolinary”.)

2. Providing people with real opportunities to take ownership of their situation (e.g. by trialing their own businesses-they were part of the cooking classes, some of them helped in Facebook promotion, some of them went to TV interviews with the team).

3. Having an established relationship that provides ongoing assistance and walks the person‟s „start-up journey‟ with them. (we want them to be co-owners of the food truck and to be inspired to run their own (Social) Enterprises).

Our current idea (and fundraising effort) is to establish and run a Food Truck as a Social Enterprise. Our idea is to work long term with young people the 15-17 years old, chef students at the State Vocational School. The Food Truck will be selling food prepared by the student chefs at 23

different locations around the city. In summer we will visit Festivals and Events to earn more profit. We got inspired by D-Fest where our chefs Jovan and Antonio had a stand to only demonstrate that “it‟s cool to cook” but people thought they can buy their food).

4. And lastly what is the future of ARNO? Irina: With many constellations we would like to remain positive and committed to continuing our work. We plan to seriously fundraise for the Food Truck (we need 50 000 EUR to start the social business). We hope this year we‟ll launch the contest for green ideas and inspire again people to apply. Since we already have full equipment ( in our office we have 6 ironing boards, irons, pots, cutting boards etc.:) we are thinking of offering Ironing and Cooking Classes to men and boys.

Our intentions for the future are to recognize the needs in our local communities and try to offer “remedies” made by our own recipes where main ingredients are: philanthropy and innovation.

Reference http://www.swisscontact.org/de/country/macedonia/news/news-detail/news/startup-macedonia-structureand-post-acceleration-program.html http://mon.gov.mk/images/documents/zakoni/Закон_за_иновациската_дејност-2016.pdf https://www.google.com/search?client=safari&rls=en&q=triple+helix+model+in+macedonia&ie=UTF8&oe=UTF-8

24