There’s no question the Kraków IT scene is dominated by the big, international players. An estimated 20 000 engineers work for mid-sized and large software and services firms. These tech centers focus on software development, service delivery, or technical support with ABB, Luxoft, and Motorola being among the largest.
This, however, is only a part of the picture. It would be unfair to forget about the smaller players, particularly those that were started here in Kraków.
Beyond offshoring heaven
Kraków is no longer just a prime offshoring destination where international companies locate their captive centers. These days Kraków is also home to a number of new firms built by young, smart, energetic people.
It would be a platitude to say everything has changed here in the last 10 years. From being a deserted land with only a handful of businesses that could be called start-ups, we now have a growing ecosystem of new ventures that operate internationally; there is access to funding (both private and public), business angels, advisers, etc.
For all of you who want to get a glimpse of where the Kraków start-ups scene is now, here are 5 things you probably didn’t know about Kraków start-ups.
1. The most successful start-up in Kraków
What is the most successful Kraków start-up? Codewise? Nope. Estimote? Nay. It appears it is Brainly. Why? They raised $40M in funding, including $14M just a month ago from Kulczyk Investments. If this doesn’t convince you, here’s another fact: Brainly has 100 million monthly users. That is four times what onet.pl (the most popular Polish web portal) has.
They have some strong competition as a leading start-up though, including BASE and Estimote, to name a few.
For those who are not students anymore, here’s a paragraph about Brainly:
Brainly is the place to learn, for students, by students. The world’s largest social learning network. It enables its users to help each other with school-work problems. Brainly was launched in 2009 in Kraków, Poland. (source: CrunchBase)
2. Top 10 start-ups according to CrunchBase and OMGKRK
All rankings are subjective. To balance out, let’s look at a couple of them.
First, CrunchBase. Crunchbase sorts firms by their CrunchBase rank. Here are the top 10 Kraków start-ups according to CB. Note, we only looked at the firms that have their HQ in Kraków.
So here is the list:
|No.||Company Name||Year Founded||Crunchbase Rank|
Here’s another rank. The most active Kraków start-up community OMGKRK has just recently published their subjective take on the top start-ups that originated from Kraków. Here’s the list:
If there are any firms that sound new, here’s a cheat sheet for you, mostly sourced from CrunchBase.
|Name||Website||About the company|
|BASE||getbase.com||Base empowers companies to take a scientific sales approach with solutions that drive adoption, big data analysis, and actionable insights.|
|Benhauer||benhauer.pl||Benhauer is a marketing software company developing marketing automation tools for companies of all sizes.|
|Brainly||brainly.com||Brainly is the place to learn, for students, by students. The world’s largest social learning network with 80 million+ users!|
|CallPage||callpage.io||Convert web visitors into inbound sales calls|
|Codewise||codewise.com||Codewise is a venture building company that focuses on the tech performance marketing sector.|
|Elmodis||elmodis.com||Elmodis offers an end-to-end IoT solution that monitors performance and improves operating efficiency of industrial machines.|
|Estimote||estimote.com||Estimote is a technology start-up, building a sensor-based context and micro-location platform for mobile developers.|
|Kontakt.io||kontakt.io||Kontakt.io builds secure and configurable beacon hardware and software to power competitive proximity-based solutions.|
|Mobiltek||mobiltek.pl||Mobile services including payments.|
|SALESmanago||salesmanago.com||SALESmanago operates a cloud-based online marketing automation platform used by over 10 000 companies in over 40 countries.|
|Silvair||silvair.com||Silvair is a turnkey smart lighting platform enabling manufacturers to provide enhanced lighting experience.|
|Synerise||synerise.com||State of the Art Marketing Cloud|
There’s also a good post from Richard Lucas on the leading Polish start-ups that includes some notes on ventures from Kraków.
3. How much money have they raised?
The total funding received by Kraków start-ups exceeds $150M (source: CrunchBase, companies’ websites).
That’s over half a billion PLN. Is it a lot? Well, it depends. Several years ago TechCrunch made an analysis of how much an average U.S.-based start-up raises before it gets acquired. It’s $41M. Even if we take into account the cost-competitiveness of Poland and assume you’d need just half of that, $20M, then this sum seems low and there are only two firms that pass that threshold: BASE and Brainly.
This can now change, though. There is a huge pool of money allocated for Polish start-ups to be distributed in the next 3 years as part of the #startinpoland program. There is a good report on this subject here. Let’s just not forget, though, that before funding, we first need ideas and the people who are willing to turn them into reality. We also need an execution that will let a company go beyond the seed money and round A.
4. What do Kraków start-ups specialize in?
It almost seems like there are 2 very specific areas where a lot of start-ups go. The first one would be IoT/Bluetooth/Beacons. Firms here include Elmodis, Estimote, Kontakt.IO and Silvair. The other group would focus on sales and marketing tools and services. The list here includes BASE, Benhauer, CallPage, SalesManago and Synerise.
There is also a third group, not really visible in the top chart, but still very active. These are all game studios. According to the “Polish GameDev 2017” study, over 20% of Polish game studios are based in Kraków. But, then, are game studios start-ups?
The majority of the firms are B2B. According to the 2017 Polish start-ups report, 76% of start-ups in Poland are B2B companies.
5. Just how many start-ups are there in Kraków?
The #StartInPoland report estimates there are 2700 start-ups in Poland. The challenge is that there is no clear definition of a start-up. One could try to list the criteria or characteristics of a start-up, such as innovation or high risk of failure, but there is enough on that in Google, so let’s skip straight to the numbers. Just remember that the ambiguity of the term and quality of the data make these numbers more a trivia than facts.
There is still a long way ahead, though. The first generation of start-ups will soon grow to be 100+ FTEs and will await first acquisitions. Not having a lot of serial entrepreneurs and sufficient capital from past acquisitions, we are still in the infancy here in the Kraków IT Valley.
There is a lot to be done and it will take another 5–10 years to get to a more mature environment. The trends are promising, though, the community is very active and the funding is there, which tells us that there will be more good news coming from the Kraków start-up world.
Find out more about the Kraków IT Market from our new 2018 Kraków IT Market Report.
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