Approximately 70% of Romanian technology startups have been affected by COVID-19, according to a study initiated by the Romanian Tech Startups Association (ROTSA) in partnership with over 130 players in the national startup ecosystem. The most thriving local tech startup ecosystem is Bucharest, followed by Cluj, Timis, and Bihor.

Most startup founders (50%) consulted with the entire team to make decisions aimed at mitigating the pandemic’s impact. A similar percentage (49%) turned to the advisory board, mentors and coaches (49%), while 39% received advice from other entrepreneurs.

“The startups’ response to the pandemic was influenced by the level of development and maturity (years in the market, number of employees and income). We noticed that startups made changes in three major areas: employees, finance and market positioning. While some startups reduced all their operations, others went in the opposite direction and increased their teams and investments. Others balanced the cuts in administrative costs with team expansion, or with increasing marketing budgets to gain a higher market share,” ROTSA said.

The association also made a profile of the technology startup in Romania: a locally registered organization that has been active on the market for less than four years, with less than four employees and an annual turnover of approximately EUR 150,000.

According to the same study, the most prosperous local tech startup ecosystem is Bucharest, followed by Cluj, Timis, and Bihor.

The startups with the highest number of employees are in Fintech (35.2%), Automation (35.2%), and Marketing (14.2%), the same source said. The startups with the highest revenues are in the same categories: Automation (38.1%), Fintech (31.8%), and Marketing (12.1%).

The main challenge for technology startups is the need for funding to support operations and expansion. The main funding source for technology startups is self-financing, while 36% of them have raised private funds (Business Angels 23%, VC 9%, Equity Crowdfunding 4%).

The study was based on research conducted in February-March among 117 technology startups.

The complete study is available here.

irina.marica@romania-insider.com

(Photo source: Weerapat Wattanapichayakul/Dreamstime.com)