Page 18 - FintechAtlas2019

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Valeri Valtchev, Chairman of the Bulgarian Fintech Association | Daniel Tomov, Partner at Eleven Ventures | Photo credit: Eleven Ventures Photo credit: The Bulgarian Fintech Association
Bulgaria
Capital as fintech hotspot in the CEE region
“One of the fastest growing fintech destinations in the CEE region”, “an evolving fintech hub” and “the most vibrant fintech destination in the SEE region”: One can often find such descriptions of Sofia, the capital of Bulgaria. And such words are not an overstatement because they are backed up by concrete data, numbers and trends that should convince even the most doubtful that Sofia is definitely one of the hottest spots on the CEE fintech map.
According to the Global Innovation Index 2018, Bulgaria is the world’s third most innovative upper-middle income country and a leader in the SEE region in terms of innovation efficiency and achievement. The country has been defined as an “innovation achiever” for 2015, 2017 and 2018.
Furthermore, in its latest ranking of the fintech locations of the future, the Intelligence Division of the Financial Times named the Bulgarian capital Sofia as the number one city globally in terms of affordability, followed by Vilnius, Lithuania, and Bucharest, Romania.
These cover all aspects of international fintech, with payments and billing (30%), capital markets solutions (15%) and personal finance (12%) being the most popular segments. The Annual Fintech Report 2019 points out that the number of employees in the fintech sector is also rising constantly, as a consequence of both the emergence of new players and the expansion of existing ones. During the five years between 2014 and 2018, the number of people working in the sector more than doubled to over 2,700.
Total operating revenue in the sector in 2018 exceeded 200 million euros, representing an annual increase of 33.5% and a doubling in just three years. Along with this rising revenue, the fintech sector is also contributing more to the national economy each year. Its share of the country’s GDP expanded from 0.4% in 2017 to 0.5% in 2018 and has doubled since 2014. In addition to this, the Bulgarian fintech sector was profitable every year between 2014 and 2018, with a total net profit in 2018 of more than 59 million euros, which is more than twice the figure for 2017.
The Bulgarian Fintech Association was founded in 2018 in light of the dynamic development of the sector. The non-profit organisation quickly became a platform for exchanging know-how and communicating the needs and challenges of the fintech ecosystem.
Eleven Ventures and LAUNCHub are the two most prominent Bulgarian seed-stage VC funds. They invest not only in the country but also across the region.
The Annual Fintech Summit, DigiTalk, Webit and Sofia Tech Park niche forums ensure that the country is also the regional leader in shared know-how in the areas of digital transformation and innovation implementation in the financial sector. In 2019, these events brought together more than 3,000 innovation decision- makers from all over the world.
“The abundance of tech talent, the favourable conditions
for running a company and the proximity of the market to global fintech trends have naturally led to the establishment of Bulgaria as a fintech hub. In addition to this, Bulgaria’s urban populations have proved curious about and eager to adopt new technologies, as a result of which the Bulgarian market is perfect for testing innovations.”
Valeri Valtchev, Chairman of the Bulgarian Fintech Association
“We have brilliant software engineers, who can code and design a new fintech platform in days, even hours. However, the biggest challenge is to transform this technology into a sustainable business. Sofia has the right ingredients for the support of fintech startups. Here, it’s easy to approach and schedule a pitch meeting with top corporate executives and investors.”
Daniel Tomov, Partner at Eleven Ventures