An Alternative Support for Startups in Krakow with Lots of Benefits

By Paul Chen

In 1997 Polish Ministry of Economy regional authorities of Malopolska, the city authorities of Krakow, Jagiellonian University, AGH, and Krakow Polytechnic got together and formed Krakow Technology Park (KPT).   The goal is to manage the many special economic zones in Małopolska Region. (Zabierzow, Ruczaj, Czyżyny)  More information can be found here.



In 2008 KPT launched a incubator to promote the idea of commercialisation of state-of-the-art technologies and to develop favourable conditions for the creation and development of innovative businesses.  I met Bartosz Jozefowski at many startup events around town and we finally got a chance to chat about Inkubator Technologiczny at Krakowski Park Technologiczny (ITKPT).  

Hello Bartosz, thank you for meeting with me please tell us about the Incubator.

ITKPT is your one-stop shop for your startup needs.  We offer mentorship, legal consultation as well as infrastructure to help your startup succeed.

What types of infrastructure?

We offer fully equipped office space in some of Krakow's most modern buildings complete with the latest IT installations.

Which companies are currently in your portfolio?

A list of companies can be found here as well as a short description.

Who are you looking for to join the Incubator?

We are looking for companies that are focused on long-term development.  We would like to see more young companies coming out of universities who are interested in developing more solid IT and engineering products and services.   

What are you expecting from the companies?

They will pay a small nominal fee for the use of our space and services.  However, we are starting for more involvement.  We would like them to take part in more meetings and promotion of the Incubator community.  

How else does a startup benefit from the Incubator?

They get complementary mentoring services, and dependent on the sector, when they “grow up” they could benefit from a good amount of tax savings.

How long do startups usually stay?

Some startups are here for years, but there have been cases where a startup stayed for about a quarter.

Who are some of your partners?

We keep good relations with big, let’s say traditional, businesses, the local authorities, as well as some of the major universities in Krakow.

How has the local economy benefitted from KPT?

In 2013, more than 650 mln zł  were invested in the special economic zones, almost 40 ICT companies graduated from our incubator, we have strengthen the game development sector by organizing Digital Dragons Festival and Digital Entertainment Cluster.

How can Innovation Nest's ACCELERATE help your startup reach new levels?

By Paul Chen

Innovation Nest is interested in building a long term relationship with you.  Until January 31, 2014 you will be able to apply to ACCELERATE, their four month accelerator program. 

Who is it for?

Teams working on SaaS products who already have a working prototype or they launched their product but would like to move into the new market. 

How does it work?

The program starts with Customer Development workshops, where the team work on their business model, their Customer-Problem-Solution. Workshops last 3 weeks and are filled with mentoring, feedback, interviews and work. This part ends with a potential investment $25 000 for 8% of equity. Second phase is intensive trip to Silicon Valley which is followed by 3 month work on new version of the product. 

I heard something about Silicon Valley?

Yes, we believe that Silicon Valley is a place to be when creating a product. That's why all of the teams that we invested in are going with us to Silicon Valley. The goal of the firs trip is to get as much feedback on your business model and product as possible. Startups will meet with our network of investors as well as they will have to arrange meetings on their own. 

What is expected from Innovation Nest?

Joining ACCELERATE means joining Innovation Nest portfolio. That means that we will try to establish a working relationship with a company. Innovation Nest is not only a financial investor but also we try to help companies with our knowledge, network and experiences. Once the program finishes its not the end because usually we invest more in our companies. We will also help to fundraise next rounds.

What is expected from the startups?

Before answering that let's quote Steve Blank "A startup is a temporary organization searching for a repeatable and scalable business". We are looking for startups that are creating a SaaS(Software as a Service) product and already have a working prototype. The program is also looking for existing companies in the same model, who already have launched a product but are looking for a new market that basically means we can call them startups as well because they are still looking for a repeatable and scalable business model. There should also be a team of people that will be able to to work hard on their product and try to validate all of the hypotheses they created during our program. 

Why ACCELERATE?

ACCELERATE is a bit different then other accelerators in Poland. First of all it's the only one that is launching 4th edition. That means we are constantly improving it and we already have experience how to create a program that is fulfilling startup needs. The program itself is created in a way that is actually fostering startups. It has three phases which help to get a bigger picture about your product and whom is it for. If everything goes right Innovation Nest is willing to invest more in startups that participated in the program.

Innovation Nest organize as well as sponsor many startup events in Krakow in the efforts of building a collaborating community.  They believe that as important as investor/ mentor to startup relationship is, startup to other startup relationship is just as important. 

Any previous success stories?

Landingi.com - Easy and fast landing pages. 

Cloud your Car - Fleet management made easy.

Visuu - selected by South Moravian Innovation Centre as one of the most promising high-tech startups

UxPin - Attracted investors like Andreessen-Horowitz, about to announce their fund raising results.

More information can be found here

KSUP and Red Viper Media Launches Krakow Startup TV

By Paul Chen

On Sunday January 12, 2014 Krakow Startup TV launched.  This is a joint effort between KSUP and RedViper Media.  Red Viper Media is headed by Paul James Pearson.  He is from Ireland and has many years of experience in video shooting and production.  We will work hard to keep you in the know with the happenings in Krakow.  Of course, here at KSUP I will keep you up to date as well as provide in-depth coverage of the Krakow Startup Ecosystem.

The host of the show is Agnieszka Wywial.  She has had many years of experience in providing news information as a journalist for various Polish radio stations.  She is naturally curious and we are very happy about the amount of enthusiasm she has been bringing to the endeavor. 

So far we have covered the X-Massive Christmas Party from last December.  We were very fortunate to get some time with Ian Scarffe and the guys from Baseconnect.  In another episode, you will also have an inside look at one of the Open Coffees held at Google for Entrepreneurs office. 

Please tell your friends to like this blog on Facebook as well as the Fan Page of Krakow Startup TV to stay up to date with all future episoides.

Net Neutrality & Venture Capitalism: How Ruling Hurts Tech Startups, Internet Innovation

Reactions to Tuesday's court decision to kill the Federal Trade Commission’s Open Internet Rules, better known as net neutrality rules, have come from all directions.

The International Business Times showed how Netflix monthly subscription fees could rise as much as $4.80 per user for high-definition streams, thanks to Internet service providers charging extra for the bandwidth. The chairman of the FCC, Tom Wheeler, also weighed in on the decision, albeit in a tepid and confusing manner. 

Entrepreneurs also worry about the effect on startup Internet companies. Without the cash flow that major companies enjoy, startups might not be able to afford the fees necessary to deliver content to customers.

Fred Wilson, a managing partner at Union Square Ventures (whose portfolio includes companies like Twitter, Tumblr, Etsy and many more), wrote about the effect the court ruling on net neutrality will have on tech startups from the perspective of a venture capitalist. Wilson said that without net neutrality rules, the environment for investors and entrepreneurs will become a “nightmare.”

Telecommunication companies "will pick their preferred partners, subsidize the data costs for those apps, and make it much harder for new entrants to compete with the incumbents,” Wilson warned on his blog, AVC.

Wilson imagines three entrepreneurs pitching great ideas to a venture capitalist and then describes how a venture capitalist is likely to respond in a world without net neutrality.

First, Wilson images a new music streaming service that helps users find and listen to new music that is playing live in their city. While established companies like Spotify, Beats and Apple could afford paying fees to ISPs to make their services free on mobile networks, a startup might not have this luxury. The company would have a hard time attracting users because it would simply be too expensive to use the service, making it difficult for venture capitalists to invest.

The same idea applies to a startup video streaming service or a new photo-sharing app. Big companies already have the income to pay ISPs for their data fees without having to pass it along to customers. A startup just couldn’t make it.

“We love your idea and would have funded it right here in the meeting back in the good old days of the open Internet, but we can’t do that anymore,” Wilson wrote from the perspective of the hypothetical venture capitalist.

“This is the Internet 3.0,” Wilson continued. “With [Tuesday’s] court ruling saying that the FCC cannot implement the net neutrality rules they adopted a while back, this nightmare is a likely reality.”

Do you agree that the end of net neutrality will hamper Internet innovation? Let us know in the comments.

Ryan W. Neal

Originally from Northern California, Ryan W. Neal came to New York to earn his master's in journalism from Columbia University

This is a repost of an article that appeared on International Business Times on January 16, 2014

Disruptions: Coming in 2014: Extremely Smart Watches and Wearable TVs

By NICK BILTON

For technological innovation, 2013 was a remarkably boring year. Apple, often the hotbed of “new,” mostly just updated familiar devices in different colors and with crisper screens. Social media companies fought over who had better photo filters. And Silicon Valley start-ups offered more of less, with slight iterations on existing products.

But 2014 has a lot of promise.

Predicting the future is a lot more difficult than evaluating the past, but you could wake up on Jan. 1, 2015, in a different digital winter wonderland.

No, you won’t lie in bed while your humanoid robot helper makes you bacon and eggs and walks the dog — which is also possibly a robot, made by Google. That’s more of a 2035 prediction. But you might wake up to the call of a watch on your wrist — not your cellphone on your night table. This year we’ve seen some efforts at smartwatches, like those made by Pebble; next year, these gadgets could look a lot better.

“Smartwatches, which connect to your smartphone, are going to create an entirely new category of computing in the coming year,” said Sarah Rotman Epps, a former Forrester analyst who specializes in wearable computing. She noted that the long-awaited Apple smartwatch, which is expected to be announced in 2014, could change the way we engage with our wrist in the same way Apple changed the cellphone industry in 2007.

Smartwatches will allow us to peer at messages without having to pull cellphones out of our pockets or purses. They will make it easier to monitor our health with heartbeat and movement sensors, recording daily how much we have exercised, or how much we haven’t.

According to Citigroup, the global watch industry generated $60 billion in sales in 2013. Numerous research estimates expect the smartwatch industry to generate billions more in revenue for consumer tech companies in 2014.

Your cellphone next year will look almost exactly the same as the one in your pocket today — though slightly larger and a little slimmer. But the software on it will be a bit smarter because of improved location sensors. Rather than your having to look at your phone all the time, your phone will start letting you know when you need to look.

Foursquare, the location-based social network, is at the forefront of this innovation. Its app works in the background to corral different pieces of information — including your location, the time of day and where your friends have been — and then makes suggestions for what to do. “It looks like you’re near the Sightglass Coffee,” the company’s app says if I walk by a coffee shop in the morning, “Your friend Dennis has been there and recommends the cappuccino.”

Now imagine all your apps start doing this? Twitter could tell you when a news event happens near your house. Facebook could let you know if your friends are saying “congratulations” to someone’s specific post — and you should too. Your phone automatically could keep emails, texts and phone calls at bay while you’re sitting down for dinner with the family, all by sensing that your spouse and children’s phones are in the dining room at the same time in the evening.

Smartphones are also expected to get other kinds of unusual sensors next year. Benedetto Vigna, a general manager at STMicroelectronics, a company that creates sensors for mobile devices, said 2014 would be when we would start to see mood-detecting sensors in phones. Imagine playing a video game that determines your excitement level and adjusts the experience accordingly, he said.

What about the home?

Until now, television screens have been pretty standard sizes and shapes: rectangular. While that won’t change in 2014, we will probably see prototypes of something different.

“We’ve been working on flexible displays for more than a decade and this past year we finally came up with solutions,” Peter Bocko, the chief technology officer forCorning Glass Technologies, said earlier this year. This means screens could wrap around clothing we wear, or the packages we buy.

In our homes, this flexible technology could translate into wallpaperlike screens that can be stuck to a wall.

But don’t be alarmed if you sit down to enjoy a nice cup of tea in front of your new flexible display and hear a buzzing sound outside: That’s probably your neighbor’s drone inspecting the back garden to see if his grass is greener than yours.

Till now, drones have been mostly used by hobbyists and photographers, but the Federal Aviation Administration is expected to issue rules for expanded commercial drone use by January.

Jonathan Downey, the chief executive of Airware, which makes drones, said we will then start to see people use these vehicles for agriculture and farming, or to reach places that are dangerous for human workers today. Rooftop inspection, for example, could be done with high-resolution thermal imaging sensors attached to a drone.

Mr. Downey predicted that any privacy concerns about drones would abate.

“When GPS first came out from the government, people saw it as something that could track them and they said absolutely not,” Mr. Downey said. Yet now, we all have GPS in our cars and smartphones. “I think we’ll see something very similar happen with drones.”

This year we did see the improvement of 3-D printers that can make physical objects from digital files. In 2014, we could start to see these devices become a fixture in our homes just as inkjet printers became a norm in the late 1980s.

According to Gartner, the research firm, consumers and companies will spend more than $600 million on 3-D printer-related products in 2014.

What will you use these for? Maybe you’ll make your own iPhone covers rather than buy them from stores, print out new salt and pepper shakers, or download a pattern and print a new part for your drone.

And who knows, if you do get a 3-D printer next year, maybe you could start downloading the parts for your very own humanoid robot helper that can make your breakfast and walk your dog in 2015.

This is a repost of an article that appeared on the New York Times on December 29, 2013

Prezi, KIBU, and LOffice Leading the Charge for Budapest Startups into 2014 and Beyond!

By: Paul Chen

Down the street from theHub.hu you can find a coworking space, called Loffice. Coworking offices are based on the sharing economy, which more and more excepted in business. Loffice is the oldest coworking space in Budapest, opened their doors in 2009, in the former printing house of the Liszt Ferenc Music Academy in Paulay Ede street. The six-story building, upon being restored in its original character and operating with renewable energies. Loffice is known as a new-generation office, it is located where the creative and the business spheres coincided; a place where the meaning of working gained a new understanding, networking and relaxing opportunities are provided, a place where everyone could find a space best suited to their activity.  More info can be found here: http://lofficecoworking.com

Loffice is focusing on SMEs and, in the meantime, working on several new projects, one of them, BiznizLab, is tailored to startup companies. Loffice is working on an incubator with 3 other partners in order to provide professional guidance and building an online database for startup companies. The project is still under construction. Loffice will launch BiznizLab in 2014. BiznizLab is meant to increase the possibility of visibility and help to validate projects and to help startups to become investment-ready. At the moment, it is in the late stages of the fund-raising process. 

Anna and Kata Klemetz are the founders of Loffice, would like to invite you to Budapest and check them out. The startup ecosystem is growing rapidly in Budapest, so there are lots of opportunities. New innovative ideas are always welcome!

Did you know that there is a Deutsche Telekom incubator in Budapest as well?  It is called Kitchen Budapest or KIBU for short.  In Kitchen Budapest, they experiment with ideas in the intersection of design, technology, art and business. Founded in 2007 and powered by Telekom, they are a multidisciplinary team of designers, technologists, artists, researchers and entrepreneurs working in a hyper-collaborative environment to create value and push boundaries forward.

Currently they have two programs which are looking for participants.  First is the Talent Program.  It is meant for 20-25 year olds who are still in university.  It hopes to give them a motivation to grow their ideas.  It is a 6 month program for those in the field of tech, biotech and hacking.  It is set to launch in late January of 2014.  What is unique about this program is that the pre-startups will have access to a in-house mentor.  There will be a 80,000 HUF stipend for qualified participants.  The winner gets a spot to the next round of the Startup Program.  

The Startup Program is to help talented teams and great projects to change the world! Essentially, those who want to make millions of people’s life better and happier. They believe that a place is needed, which inspires personal improvement and startup development.  The three most important ingredients of a successful realization of a startup are knowledge, relationships and money. This is why their mentors, partners, domestic and international investors, and 6 million HUF financial funding are at the startup's disposal during the step by step development of the startup.

I met up with Zsolt Winkler, the managing director of KIBU and asked him a few questions:

How do you feel about the state of the startup ecosystem in Budapest?

Like most of the people you interviewed, I would agree that we are still at the beginning stages of the development.  There are still lots of work to be done.  Despite some successes, many startups are not at the stage where they are ready for investing yet.  However, here at KIBU we are working hard to change that.  

Do you feel that there is a lack of funding in startups?

No, we have enough funding to get us growing.  Hungary has just received about 400 Million Euro of Germy funding from the European Union.  However, I feel that we still need to be educated on how to fund startups.

How so? 

At the moment, startups are not too well educated in how much control they should give up in order to get funding.  At the same time, some local VC's are not well educated on how much equity they should take for their investments.  For example some VC's might ask for 50%, non-negotiable for 200 thousand Euros, whereas 20-25% would be more reasonable.  

But that would give the VC almost sole ownership of the project and make pivoting very difficult.  

Exactly!

How is KIBU combating this?

In our Startup Program we are only asking between 10-20% in exchange for up to 6 million HUF plus mentoring services.  

What are you looking for?

We are looking for startups that would like to solve problems of one million people.  It is not limited to telco, but other fields can be considered.  

Other than mentoring, what else is included?

We are offering education in strategy and design, developing an effective pitch, setting up a solid business plan, and get the startup ready for the seed round.

Has KIBU had any good success stories?

Yes, one of the biggest success stories to come out of KIBU is Prezi, the dynamic Flash-based presentation software producer.  

What are you working on currently?

We have two startups currently in progress:

http://getpiqniq.com/

http://getinch.com/

You might have seen some of your colleagues making their presentation on something other than the popular Microsoft Powerpoint.  If you have, then most likely, it would be a Prezi presentation.  And they are fantastic!  The SaaS presentation tool is Flash-based and very dynamic.  It allows you to move, zoom-in, zoom-out.  Just as you think you might get bored with one particular slide, you are whisked away on a ride to another part of the presentation.  And the software allows you to feel the journey with very clever movement in graphics.  

The company isn't really that startup-like anymore.  One cannot just turn-up and talk to anyone, you need to make an appointment.  I was able to ambush one of their representatives and get a coffee chat.  She expressed her joy with working at Prezi.  She told me that the working space is up for a award of working space of the year in a local contest.  

One of the things that she kept emphasizing was the values of the company and its employees.  They want to allow their employees to be free thinking but hard working.  Because of the open office space, there is a community feel to the place.   She is happy to report that the founders of the company are very accessible.  They aren't hidden away in some ivory tower guarded by a gate-keeping administrative assistant.  

She feels that Budapest is really coming around as far as startups are concerned.  It is powered by the youth and their optimism.  The city is cosmopolitan populated by talented young professionals who enjoy the pressure and don't mind collaborating for the greater good.

One example is the Bridge Budapest. It is a fellowship allowing talented Hungarians to gain practical experience by working at one of the big three, Prezi, Logmein, and Ustream.  Not only do you get to work in one of the most promising Hungarian companies, you are equipped with a smartphone, insurance, and accommodation. Your travelling expenses are also covered.  The only requirements are the application process, participation in meetings, and file a „report” at the end of the program.  More information can be found here.

Top 10 Predictions for Technology in 2014

Microsoft may get its mojo back, smartphones will get cheap, and we’re about to enter the Year of Encryption. A look at what to expect in telecom and computing for the coming year.

How might 2014 play out in tech? Silicon Valley may again need to watch out for Microsoft, cheap smartphones will hit markets, and the Edward Snowden revelations will launch the Year of Encryption. Those are a few predictions from Mark Anderson, founder and publisher of the Strategic News Service newsletter, long a must-read for industry leaders and venture capitalists, and host of Future in Review, an annual gathering for tech leaders, investors, and policymakers The Economist called “the best technology conference in the world.”

What does Anderson see in his crystal ball? Here’s the new edition of his annual list of 10 predictions for the telecom and computing world for the year to come.

1. Siris Move Into Silos. 

Internet assistants display their importance as a category by spreading out into a large number of new Siri-like products, many of which work to increase utility by going deep into vertical markets. The results are improved success in voice recognition, knowledge-base utility, and customer trust and acceptance.

2. Visualization Goes Mainstream.

As big data, cloud computing, and vast increases in storage and processing take hold, the role of data visualization becomes much more common in our tools. Having created systems much more advanced than the human brain in these categories, we now must find improved ways of digesting all of this information.

3. The Cheaper Factor.

 Low price becomes a critical driver in global consumer-electronics product creation, as emerging economies absorb a dramatically larger fraction of all devices sold. The result of bringing hundreds of millions out of poverty is a shift in design motivation from the radically innovative, to incremental change at low cost, driven by the creation of a new purchaser segment in consumer electronics.

4 + 5. Sub-$250 pads and Sub-$100 Smartphones dominate their categories. 

These ought to be the top two best-selling product types in their categories for the year , and these two categories ought to be the top two consumer electronics categories for the year, when measured by volume.

6. Software Plays on a Flat Hardware Field, as We Build Out the Global Computer.

 This is the real mover behind everything in IT, from the blank black real estate of your cellphone and pad, to virtualized storage and servers, emulated processors, software-defined networks and the most advanced cloud-computing services. Even as hardware continues to advance, software is where most of the energy, innovation, and action occur.

8. The New Microsoft That No One Expected. 

Microsoft gets a new CEO, with a new power structure that encourages cooperation instead of warring factions, and which leads to improved success in consumer markets. The stock continues to climb, on an annualized basis, and Redmond starts to get some of its “mojo” back, defined by people wanting to work there.

8. Micromapping arrives. 

Various firms open the door on a brand new category in mapping, advertising, location and ID, and transactions. This MALT category launches in 2014, with small but fast-growing revenue that will become mammoth in years ahead.

9. The Quantified Self Goes Mainstream.

The idea of knowing more and more detail about your personal health and characteristics goes from being a science story to a jogger’s delight to a mainstream market. Keeping track of your own health data in real time is no longer something for geeks and workout fanatics, but is accepted as a new and mainstream category of behavior, products, and preventative medicine. Doctors will have to start catching up.

10. Encryption Everywhere. 

The direct commercial result of Edward Snowden’s leaks will be a massive move by large technology companies, both in enterprise and consumer markets, to evolve new encryption technologies and products that use them. While NSA-proofing will be the motivator, the real benefit may be improved protection of commercial IP from theft by China and other nations.

This is a repost of an article that appeared on the Daily Beast on December 7, 2013