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Entrepreneurs Speak Out
Entrepreneurship Barometer
Romania 2013
Forward
Bogdan Ion
Country Managing Partner
EY Romania
The entrepreneurs play a vital role in any healthy
economy. Within the last years, especially in a difficult
economic context, their role became more and more
visible in the eyes of the authorities and for the Romanian
public. The awareness of their relevance in the economy
increased: entrepreneurs hire when few business people
consider this option, they are those who see opportunities
in economic downfall and who invest during recession.
This is the reason why, supporting the entrepreneurs and
those who are thinking of becoming entrepreneurs is one
of the measures which can create a strong foundation
for economic growth. And, according to EY The Power
Of Three - G20 Entrepreneurship Barometer 2013, the
governments and those responsible for public policies are
paying increased attention to the entrepreneurs needs,
through specific programs and public initiatives.
EY has been supporting entrepreneurs from all over the
world for more than 30 years, offering dedicated services
and competencies. We are committed to do this also in
Romania.
Also, we reached the second edition of the Entrepreneurs
Speak Out Entrepreneurship Barometer, a project
developed by EY Romania in order to support and
promote successful businesses and the principles that
made their performance possible in Romania.
I want to thank Romanian Business Leaders Foundation
for their support and collaboration in conducting this
study.
Entrepreneurship Barometer Romania 2013
Entrepreneurs speak out - A call to action

Romanian entrepreneurship
One of the main conclusions of our first edition of
The Entrepreneurship Barometer, issued in 2013, was
that Romanian entrepreneurs lack relevant information
about sources of financing, organizations that support
entrepreneurship, specific entrepreneurial education and
training. However, this years barometer indicates a higher
degree of information, especially regarding sources of
financing. Also, funding continues to be one of the most
important challenges for the Romanian entrepreneurs:
88% of them consider access to funding difficult or very
difficult. At the same time, the Romanian entrepreneurs
believe, as in the previous editions, that entrepreneurship
and business failure are negatively perceived in the
Romanian society, 81% of them considering business
failure a barrier for future business projects.
In this context, in order to generate change and to develop
the Romanian entrepreneurship, it is vital to monitor the
performance of measures dedicated to entrepreneurs
and to understand local entrepreneurs needs. This is
the reason why we publish the second edition of the
Entrepreneurs Speak Out - Entrepreneurship Barometer in
Romania 2013.
The conclusions of the study must be seen as an

opportunity and a challenge for the state institutions,
credit and financing institutions and for all the
stakeholders, including the entrepreneurs. By taking
actions in the areas where the study shows that
entrepreneurs are not supported enough, the
entrepreneurial environment could be strengthened, while
the Romanian economy could be revitalized more rapidly.
The Entrepreneurship Barometer may even represent
an instrument for the government to tackle barriers which
prevent entrepreneurial success and the formation of a
strong entrepreneurial environment in Romania.
We emphasize that the small sample of answers indicates
that results of the study cannot be considered exhaustive,
but can be taken into account as a snapshot of what
some of the most active Romanian entrepreneurs think
about financing, entrepreneurship culture, education and
coordinated support and tax and regulatory frameworks
for entrepreneurial companies.
The Barometer represents the voice of 106 Romanian

entrepreneurs (with companies in different stages
of development, from startups to mature ones) who
answered to an online survey. The study is also based
on 10 direct interviews with successful Romanian
businessmen, and also on quantitative and qualitative
insights from The World Bank, OECD and the Romanian
National Institute of Statistics.
88%
of entrepreneurs consider access

to finance difficult or very difficult
94%
of entrepreneurs think that regulatory

and tax environment should be more
predictable
81%
of entrepreneurs consider business

failure to be a barrier for future
projects
About Entrepreneurs Speak Out

The Entrepreneurship Barometer
The Entrepreneurship Barometer is a yearly perception
barometer that aims to explore and articulate in a direct
manner the issues, expectations and needs of Romanian
entrepreneurs, based on a qualitative and quantitative analysis
of the Romanian entrepreneurship environment.
Our focus on entrepreneurship aims also to emphasize how
policy makers could crucially assist entrepreneurs in Romania,
thus supporting new business generation, economic growth
and job creation.
However, the study emphasizes not only what the government
can do, but also what entrepreneurs can do to seize
opportunities. At the same time, Romanian entrepreneurs
that have created successful businesses share with us their
entrepreneurial story, the challenges of the Romanian
entrepreneurial environment as they perceive them and
measures that they recommend for improvement.
Provide a simple tool to measure the competitiveness

of the Romanian entrepreneurship environment
Provide year-on-year figures to measure progress
Simple and recommendation-oriented indicators
Goals:
The analysis is focused on five fundamental factors:
entrepreneurship culture, access to funding, regulation and
taxation, education and training, and coordinated support
from specialized associations.
Our approach is based on:
1
2
3
The opinions of entrepreneurs regarding the

progress and impact of specific enablers
Quantitative economic and social indicators
Best practices identified in other countries for
developing entrepreneurship to be applied in
Romania.
Our barometer sums up the perceptions of 106 online

surveyed entrepreneurs and 10 directly interviewed wellknown Romanian entrepreneurs.
This Barometer follows a global initiative of EY. Its first
edition was published on the occasion of The G20 Young
Entrepreneurs Summit (31 October - 2 November 2011)
in Nice, France. The second edition of the G20 Barometer
was issued in august 2013. The EY G20 Entrepreneurship
Barometer 2013 study analyzes individually and jointly
the entrepreneurial ecosystem in G20 countries: Argentina,
Australia, Brazil, Canada, China, France, Germany, India,
Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South
Korea, United Kingdom, United States and European Union.
The entrepreneurial development framework: five pillars that foster entrepreneurship
Access to funding
Tax and regulation
Seed
Taxation incentives
Start-up
Ease of starting a business
Expansion
Business-friendly legislation/policies
Capital growth
Coordinated support
Mentors, advisors, networks
and clubs, Business
incubators, clusters, parks
and business centers
Education and training
Entrepreneurship culture
Pre-university education
Tolerance of risk and failure
University education
Preference for self-employment
Entrepreneurship-specific training
Informal education/lifelong learning
Innovation and research culture

Celebration of self-made wealth
Why are the entrepreneurs important and how can they be

helped?
Entrepreneurs provide one of the main engines of growth and
are a key source of jobs1.
In the US, start-ups and firms less than 5 years old account for
nearly all net job creation over the past three decades3.
Across the EU as a whole, entrepreneurs supplied 67% of all

jobs in 2012. In China, they provide 75% of all jobs2.
In Romania, according to OECD, SMEs contribute with 66% of

the total number of employees from private companies.
1 Ecorys, EU SMEs in 2012: at the crossroads. Annual report on small and

medium-sized enterprises in the EU, 2011/12 (ECORYS Nederland BV, 2012)
p. 15.
2 Ministry Of Commerce Peoples Republic Of China website,
english.mofcom.gov.cn, accessed 3 July 2013
3 D Stangler and P Kedrosky, Neutralism and Entrepreneurship: The Structural

Dynamics of Startups, Young Firms, and Job Creation (Ewing Marion Kauffman
Foundation, 2010) p. 13.
I am an innovator, I develop new products and services, I apply

efficient production methods and I create new business models.
I am eager to learn, I network. I think globally and make a
significant impact on my communities through creating jobs and
bolstering economies.
I need help to access

funding
I need a streamlined tax

and regulatory system
43%
88%
of entrepreneurs are
unsatisfied with the level
of fiscal policies, fiscal
uncertainty and bureaucracy
of entrepreneurs say
that access to funding
is difficult or very
difficult
I need a more supportive

culture
52%
expect improved
communication
of successful
entrepreneurial
stories to have a
major impact on
the entrepreneurial
culture
I need a simplified fiscal

environment
91%
need taxes and regulation

to be simplified
I offer mentoring in order

to help other entrepreneurs
develop
80%
I need support from

the government
are mentoring in a formal

or informal environment
29%
of them consider that SME credit schemes

would be the most effective
I need a predictable
fiscal environment
94%
of the entrepreneurs
advocate for a more
predictable tax and regulatory
environment
I need society to
tolerate failure
81%
say that failure in business

is perceived as a barrier for
starting a new business, a
career failure or a lack in
necessary abilities
Source: Entrepreneurs Speak Out - Entrepreneurship Barometer Romania 2013
The economic impact of SMEs

The figures indicate that countries with strong support
for entrepreneurship benefit from an increased level of
new business generation. By matching the best rankings
in the EY G20 Entrepreneurship Barometer 2013 with the
number of new companies created in those countries, we can
conclude that countries with a friendly regulatory, financial,
educational, cultural environment for entrepreneurs have the
greatest business generation rate. Countries ranked highest
(e.g. Great Britain, Canada and Australia) have the largest
density of companies. On the other hand, many economies
experiencing rapid growth, where entrepreneurship is not
yet well developed, like Argentina, India and Brazil, neither
registered a high rate of new created companies, nor a good
position in the EY ranking.
One of the main drivers of stimulating business creation is

the role of entrepreneurs in economic growth and creation of
new jobs. SMEs (companies with less than 250 employees)
represent the majority of the companies in economy and are
those which provide the highest rate of employment. Among
OECD countries, SMEs represent 99% of the companies
and employ 2/3 of all hires1. In Romania, SMEs employees
represent 66% of all jobs in private companies.
The conclusion is clear: the countries that manage to improve

the conditions offered to entrepreneurs can expect an increase
in the number of created companies, as more people will
consider entering entrepreneurship as convenient and more
accessible.
1 Organisation for Economic Co-operation and Development, Issues Paper

1: Innovative SMEs and Entrepreneurship for Job Creation and Growth
(Bologna+10 Meeting Brief, 2010
2 EIM, Do SMEs create more and better jobs? (EIM Business & Policy Research,
2011).
Moreover, those companies create twice as many jobs as

mature companies. In the European Union, between 2002 and
2010, 85% of employment growth was provided by SMEs2.
SMEs contribution to total number of employees in the private sector

Up to 250 employees
Romania
More than 250 employees
66%
United States
34%
50%
50%
United Kingdom
53%
Turkey (2009)
47%
31%
69%
25%
75%
Spain
Slovenia
72%
28%
Slovak Republic
72%
28%
Russian Federation
29%
71%
79%
Portugal
Poland
21%
68%
Lithuania
32%
75%
25%
80%
Italy
Hungary
20%
72%
Germany
28%
63%
Czech Republic
37%
70%
Bulgaria
30%
76%
24%
Belgium
69%
31%
Austria
68%
32%
0%
20%
40%
60%
80%
Source: OECD, Entrepreneurship at a Glance 2013 - OECD 2013
100%
A call for action

A common effort is needed for the improvement of entrepreneurship environment
The entrepreneurs are extremely motivated, innovative and
are able to find resources to face any context. However,
if the fiscal, regulatory, funding, cultural and educational
environment were friendlier, more people would have the
courage to start a business, contributing to the Romanian
economic competitiveness.
In order to remove barriers, a common effort is needed not

only from those who set the public policies, but also from
investors, entrepreneurs, journalists, teachers, specialized
associations and corporations.
A common effort is needed for the development of entrepreneurship:
School and
education
Investors
Entrepreneurs
Culture
Press
Companies
Government
Regulatory
bodies
Specialized support
bodies
In an environment with a high degree of uncertainty,

entrepreneurship starts gaining ground, specifically in the
area of technology.
We see more and more young people

trying to develop a new product on their own, targeting
the international markets and, rarely, the local one. More
often, Romania is the market where the products are
tested, despite the fact that there are numerous areas in
Romania that could benefit from technological innovation.
It is important to mention the trend in outsourcing
companies: they now are developing their own products,
which determine transformations in their organizational
culture and their market positioning.
The challenges remain numerous, starting from difficulty in

accessing funds, lack of a complex entrepreneurial education
to cover the needs of a start-up, and, sometimes, lack of
strategic vision from the young entrepreneurs. On the other
hand, examples of successful companies come into light,
with record growth rates, like MavenHut or CyberGhost,
or those acquired by international companies, like uberVU
and Avangate. Those examples of success are essential for
attracting foreign investors to Romania and for increasing the
faith that a start-up founded here can be successful on the
international market, not only as a brand, but also financially
speaking.
Daniel Dragomir, CEO TechHub Bucharest, community and
co-working space for technology entrepreneurs
Access to
funding
Romanian entrepreneurs,
in line with entrepreneurs
from EU or G20 countries,
consider improved access
to funding to be crucial to the
development of entrepreneurship.
90%
of the Romanian entrepreneurs consider

access to funding difficult or very
difficult for young entrepreneurs
(less than 40 years old)
Conclusions on access to funding

48% of entrepreneurs who answered our survey consider
access to funding has worsened during the last year in
Romania, despite the fact that entrepreneurs from EU, as well
as from Romania, say that funding is the most impactful factor
for the entrepreneurship environment.
Among the instruments that are considered to have the

largest potential impact in Romania are bank loans, venture
capital investments, business angels and private equity, in line
with answers of entrepreneurs from EU and G20 countries.
That is why it is necessary to facilitate the access to funding

for entrepreneurs.
State aids and crowdfunding though are not perceived by

Romanian entrepreneurs to have the same potential, in
contrast with EUs and G20 entrepreneurs perceptions.
Has access of entrepreneurs to funding improved during the

last year in Romania?
The 3 instruments that could have the largest impact in

sustaining entrepreneurship in Romania, if boosted
Stayed
the same
27%
Romania
EU
0%
10%
G20 average
Bank loans
Worsened
48%
Venture capital
Business angels
Dont know
or no opinion
9%
Private equity
Microfinance
Improved
16%
State aid
Clients
Public-private partnership
The perception on access to funding of entrepreneurs in 2013,

in Romania, by age groups
Worsened
Stayed the same
Improved
Dont know or no opinion
> 40
50%
years old
24%
Family and friends

IPO
Suppliers
15%
Crowdfunding
11%
20%
25%
Source: EY Entrepreneurship Barometer Romania 2013

and EY G20 Entrepreneurship Barometer
< 40
45%
years old
0%
20%
32%
40%
60%
18%
80%
5%
100%

Worsening of access to funding in 2013 is felt by Romanian
entrepreneurs in a context that was already difficult from a
financing standpoint. Therefore, 88% of them say they can
hardly access funding in the local market.
If we compare the results with EU or G20 data, the perception

of the Romanian businessmen is more than pessimistic, in line
with the negative EU general perception regarding access to
funding, hovering around 76%.
In the case of young entrepreneurs (aged under 40),

the access is even more difficult: 90% of respondents think
that for them funding is difficult or very difficult marking
a slight increase compared to 2012.
Do you think that access to funding in Romania

is easy for entrepreneurs below the age of 40?
(2013 vs 2012)
100%
Do you think that access to funding in Romania is easy for

entrepreneurs below the age of 40?
(Romania vs EU vs G20 average)
Very easy
Easy
Difficult
Dont know
or no opinion
Very difficult
90%
80%
Romania
37%
55%
70%
Very difficult
50%
Dont know
or no opinion
56%
30%
EU
19%
G20 average
21%
0%
Easy
35%
55%
35%
5%
Difficult
60%
40%
5%
33%
33%
20%
40%
29%
17%
2%
29%
15%
2%
60%
80%
100%
Very easy
20%
10%
0%
4%
3%
2012
5%
5%
2013
How do you perceive access to funding for entrepreneurs?

Very easy
Easy
Difficult
Dont know
or no opinion
Very difficult
Romania
8%
69%
25%
EU
G20 average
25%
0%
20%
19%
32%
27%
30%
26%
40%
60%
9%
10%
80%
Source: EY Entrepreneurship Barometer Romania 2013 and

EY G20 Entrepreneurship Barometer
4%
7%
9%
100%

Regarding the areas of action for the government, the
Romanian entrepreneurs consider that tax incentives for
investments in SMEs (16%), more effective and simplified
regulatory systems for businesses (13%), and credit
warranties (13%) would have the most significant impact on
funding in Romania. The first two set of actions are the ones
identified also by EU entrepreneurs as having a significant
impact.
For EU entrepreneurs, the most important actions following

the previous two are the reduction of capital gains tax (9%),
credit warranties (8%), infrastructure investments (8%) and
simplified listing rules for SMEs on stock exchanges (8%).
Which are the 3 most important areas of action for the government that can improve entrepreneurs access to funding?
Romania
EU
G20 average
Tax incentives for investment in small business

Simplified, more efficient business regulatory systems
Loan guarantee
Promotion of fair, efficient labour laws
Invesment in infrastructure
Funding for lending schemes/targeted lending schemes
Low capital gains tax
Tax breaks for corporate venturing
Promotion of a business environment that is not overlay litigated
Procurement*
Grants
Regulatory framework for crowd funding and other
Simplified listing rules for small companies
Sponsorship of networking and entrepreneurship forums
Match/partner with private investments in high-growth
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
*government undertakes to use small entrepreneurs for a certain percentage of their tenders
Source: EY Entrepreneurship Barometer Romania 2013 and EY G20 Entrepreneurship Barometer
10
Financing growth: the funding ecosystem for entrepreneurs

As entrepreneurial businesses grow and develop, the sources
of finance they rely on change.
It is therefore essential that governments create a range of

mechanisms and institutions that provide entrepreneurs with
the capital they need at every stage of the growth journey.
EY guide for funding entrepreneurial companies
Public stock markets

Private equity
Formal VC/growth capital
Government export schemes, grants
Government grants (e.g., R&D), SME purchasing focus
Corporate accelerators
Corporate VC
Incubator/accelerator
Revenues
Speciality bank loans and guaranatees

Seed/early stage VC
Crowdfunding
Angels
Entrepreneur, friends, family
Pre-seed
Seed
Start-up
Emerging
Rapid-growth
Expansion / market leader
Development stage
Stage 1: emerging company

Newborn companies - in the pre-seed, seed and start-up
stages, the most vulnerable stages of any business, also
named The Valley of Death are in a great need for capital,
usually very hard to find in this phase.
Most of the times, entrepreneurs rely on their own funds.
According to Global Entrepreneurship Monitor 2012 US
Report, 73% of entrepreneurs who have started new
companies in the US in 2012 funded them from their personal
savings. In this phase, the family, friends, but also banks
through personal loans and credit card offers, are important.
Further in the emerging stage, the new companies do not
follow the same type of funding. For many, their own savings
and the working capital represent the most important types of
capital.
Other will access specific funding for this stage of growth,
like capital offered by:
Business angels - wealthy individuals, usually entrepreneurs
whom invest in young companies and offer advice for the
funded start-up.
11
Crowdfunding - offers funding even earlier than business

angels, is based on contributions made on specialized online
platforms.
Venture capital - capital offered by institutional investors,
especially to innovative startups with promising growth
prospects.
Despite an unfriendly macroeconomic climate for startups in

the last years, we have witnessed an extraordinary dynamics
of the funding methods for newborn companies, especially
due to crowdfunding.
The entrepreneurs from G20 countries generally claim that
the access to necessary funds during the emergence phase
has improved in the last 3 years.
In the same time, the Romanian entrepreneurs have made
significant steps in understanding these types of investors/
funding instruments. If in the 2012 edition, the entrepreneurs
could not appreciate the impact of business angels and
venture capitals, this year 19% of the respondents consider
that these two types of funding have the most potential in
developing entrepreneurial initiatives, almost as much (20%)
as those who consider bank loans the most well-known
funding method as having the greatest potential impact.

Among the countries which rank highest at funding conditions
for the new born companies are US, Canada and Australia,
but also Saudi Arabia and Indonesia. The last two countries
ranked so well due to 50% debt government guarantees at
accessing risk capital, while one of the largest state companies
in Saudi Arabia has a corporate venture capital fund to invest
in start-ups. The Indonesian government guarantees 70% of
the loans, with an estimated fund of USD 2.9 billion in 2013.
In Romania, at the moment, there are no guarantees made
by the government at comparable level or corporate venture
funds initiated by state companies.
Innovative forms of funding are emerging

Micro financing, a financing option for entrepreneurs who
do not have access to traditional banking loans, has improved
significantly, especially in the markets with fast economic
growth. In Romania, according to EBRD, the potential market
of microfinancing is 500 million EUR, fueled by commercial
banks and nonbanking financial institutions in proportion of
70%, while 30% of the demand is not satisfied. Over time,
EBRD partnered with Romanian financial institutions in order
to offer micro financing to the Romanian market.
At the moment, some of these institutions offer micro
financing through the programe Progress financed by the
European Investment Bank. These institutions have an annual
portfolio of EUR 100 million, offering 20.000 credits per year.
The average value of a microloan is under EUR 10.000 and
can reach EUR 25.000.
Motivation of those who offer sums of money through crowdfunding

Financial motivation
Own capital
Bank loan
Loan for the

product/service
Social loan
Social
Motivation
Donations
Capital for the

product/service
Rewards
based
Sales in
advance
Material
motivation
Source: A Framework for European Crowdfunding, October 2012
Crowd funding is a disruptive industry. Because of it, people

can use an extremely simple and inexpensive mechanism to
finance their projects.
Crowdfunding is still at the beginning in Romania, but
we expect that this industry will grow in the next years.
A significant barrier in the development of the field is
represented by the small degree of familiarity of initiators of
the projects as well as of funders with this financing method.
The efforts directed toward educating the market seem to

have results, because there are significantly more persons
interested in this funding method now compared to last
year.
The value of the market for the crowd funding reward-based
projects (financing in exchange for rewards) in Romania is
estimated at about EUR 100.000.
Judit Katona, co-funder of the crowd funding platform
Cretemidei.ro
12

Expectations from crowd funding are high, the new comer in
the world of funding for startups being increasingly perceived
as a solution for overcoming the big problem of funding in the
early stage of the business.
At a global level, there are over 400 crowdfunding websites
(one of the largest is kickstarter.com). This means you
can finance your business from tens, hundreds, thousands
of donors of small sums. At a global level, crowd funding
platforms have raised funds of USD 2.7 billion in 2012 for
more than one million campaigns and USD 5.1 billion in 2013
(estimate by Massolution Crowd Power Solutions). The field
is becoming so popular that the European Commission intends
to promote the sector by creating an European network of
crowdfunding platforms.
AngelList
Being a disruptive instrument in the angels investors world,
AngelList is an online service which facilitates the meeting
between the entrepreneurs and investors.
As soon as a company begins to hire people and to develop

products and services, usually they need capital injections and
the business angels investors can provide the right amount
of capital in this stage. They are even incentivized from a
fiscal perspective starting 1 January 2014: the Fiscal Code
has been accommodated to include facilities for these kind
of investors. Holding companies which register profit on the
sale of shares or from dividends are exempt from capital gains
taxation. Therefore, business angels investors could establish
companies with a holding structure in order for the profits to
be tax exempted.
Education and business angels networks play also an
important role in the development of this instrument of
funding: potential business angels must easily gain access to
information about this kind of investment opportunity and
about investment mechanisms.
It was created in 2010 and provides a data-base with

complete information about entrepreneurs and investors.
Through this platform, hundreds of companies have
managed to find financing until now.
Angel investors
Venture capitalists
Who
Businessmen with wealth

over USD 1 mil.
Professional investors
The source of funds
Invest their own funds in startups
Invest institutional funds in more

mature companies
The size of investment
Usually between
USD 10.000-50.000
On average USD 7 mil.
The role of the investor
Is not involved in the operational

management
Actively involved in the business
Rate of success
In 52% of the cases the invested

money are lost
40% do not succeed
Source: The Boston Globe, 2013
13
Business angels investors essential in the emergent

phase

Second phase: fast growth
Access to traditional bank lending remains difficult
for fast-growth companies
At the rapid-growth stage, entrepreneurs can demonstrate
a market for their products or services and may already be
earning revenues. In theory, more funding options should now
be available, including bank loans and venture capital.
Since the financial crisis, however, small companies have
continued to face major hurdles in accessing funding in
Romania. Banks are under pressure to boost regulatory
capital, and this is encouraging them to shrink their assets
by reining in lending. Thus, they remain selective in granting
financing. In general, they take into consideration companies
with a solid financial history, while new companies are not
bankable, being perceived as bearing a high risk. Though, the
Romanian banks take into consideration the SMEs segment
and have a few dedicated financing instruments based on
the funds received from international banks focused on this
segment, like European Investment Bank and International
Finance Corporation.
Government credit guarantee schemes
In this dry financing landscape, the government tries to

stimulate SMEs loans through state guarantees.
Mexico, Turkey, Indonesia, South Korea are just a few states
that offer these schemes and the impact is significant. A
similar scheme has been introduced in 2012 in Great Britain,
and offers lending facilities of over 2.5 billion for more than
16.000 companies.
In Romania, a scheme for SMEs will function similar to the
First Home program. The state will offer guarantees up to
Lei 2 billion, representing 50% of the bank loan for working
capital. Eligible companies must have registered a turnover of
up to EUR 50 million in the last fiscal year, be operational active
for at least 3 years and have recorded operating profit in the
last 2 years. The interest is 3 months ROBOR plus a maximum
margin of 3.5%. The credit will function as a line of credit in the
revolving system.
Also, European funds for startups can be obtained through
the JEREMIE project, launched by the European Commission
and the European Investment Fund, part of BEI. JEREMIE
offers to financial intermediaries financial instruments for
SMEs: guarantees, co-guarantees, counter guarantees, equity
guarantees, micro-loans, risk capital, securitization instruments,
co-investment funds, investment in technology transfer funds.
Through these facilities, the partnered financial intermediaries
offer SMEs loans and equity participation. JEREMIE, however,
does not operate as nonrefundable funding for SMEs.
In the European Union, The Competitiveness and Innovation
Framework Programme (CIP) will be followed during the
period 2014-2020 by the program for the Competitiveness of
Enterprises and Small and Medium-sized Enterprises (COSME).
With a EUR 2.5 billion budget, the program will facilitate the
access to finance and will encourage the entrepreneurial
culture. Of the total financial package, EUR 1.4 billion are
allocated to financial instruments. The rest will be spent for
funding the Enterprise Europe Network, a platform dedicated to
international industrial cooperation and education, in order to
develop the entrepreneurial spirit. Access to loans will be easier
especially for entrepreneurs to launch cross border activities.
International banks with new loan models for

entrepreneurial companies
Some international banks have developed loan schemes
intended to new companies. These banks do not offer loans
based on guarantees or on companys income, but on other
performance indicators and future potential of the business.
This kind of shift would require banks to develop new
competencies and expertise in early-stage business.
Silicon Valley Bank

Silicon Valley Bank (SVB) is a well-known bank which
funded thousands of start-ups since 1983 (the year of
founding). SVB has gained a profound knowledge of
start-up assets (usually only intellectual property assets
or incipient, new ideas) and start-ups revenue. The SVB
experience remains an example for other banks on how
financing new companies can be a feasible and profitable
activity.
Cash plus mentorship through US Small Business

Administration
Small Business Administration (SBA) is a best practice
example on supporting risk capital funding (venture
capital). The American Federal Agency is one of the oldest
and most successful initiatives designed to bridge the gap
between venture capital funding and small companies,
by providing guarantees up to 90% of the granted loan.
In 2012, its finance programs provided US$30.25b in loans
to small businesses.
One of the main reasons for the SBAs success is the
way it combines financial support with education.
The agencys national network of experts provides support
to entrepreneurs through mentoring, training, legal advice
and even assistance with securing government contracts.
14
Selection of governmental programs offering support

to SMEs in 2014 - nonrefundable funds
Agenia pentru Implementarea Proiectelor i
Programelor pentru ntreprinderi Mici i Mijlocii
(AIPPIMM)
Besides the option of loan guarantees, companies have also
the option of accessing nonrefundable financing allocations
offered by the Romanian State.
The Minister of Economy through The Department for SMEs,
Business Environment and Tourism implements programs
offering state budget funding for improving the rate of new
Programs for the SMEs
business generation and developing SMEs in Romania.

Probably the most well known program of this kind is
the one focused on young entrepreneurs (younger than
35 years old), the so-called SRL-D program.
The program with the most generous budget, the
De minimis aid scheme funds up to 90% of eligible
expenses as a nonrefundable financial aid for SMEs.
For 2014, the maximum value of the state aid is
100.000 EUR/firm, and the registrations have been
already closed, recording over 7.000 applications.
2012
2013
Budget (lei) Beneficiaries
Budget (lei)
2014
Beneficiaries Budget (lei) Beneficiaries
The program for stimulating

the establishment and
the development of
microenterprises by young
entrepreneurs The SRL-D
program
21,000,000
25,000,000
576
21,000,000
493
The Mihail Kogalniceanu

program for the SMEs
70,000,000
12,000
16,115,000
1,635
10,000,000
400
1,000,000
300 SMEs
and the
opening
of 3 new
incubators
6,470,000
14 incubators
500,000
14
20,000,000
129
The program for

establishment and
development of technology
and business incubators
National program for
the development of the
entrepreneurial culture among
the women managers
500,000
The program for the

development of the
entrepreneurial abilities
among youth and facilitating
access to funding START
10,000,000
The program UNCTAD/

EMPRETEC Romania for SME
support
350,000
De minimis aid scheme
92
Source: Agenia pentru Implementarea Proiectelor i Programelor pentru ntreprinderi Mici i Mijlocii, aippimm.ro
15
6,000,000 15 incubators
13,000,000
12
130
500,000 4 work-shops
250,000,000
555
Almost
1000
corporate venturing units worldwide
Incentivizing venture capital activities

Risk capital plays an important role in funding companies with
larger capital injections than what business angels usually are
willing to invest. A venture capital (VC) investment is desired
even for the multiplication effect: after receiving a round of
funding from a well known venture capital fund, access to
loans and other types of funding becomes easier.
At the same time, some governments support the VC funds

to invest in start-ups, like the Australian government which
offers USD 104 million to local VC funds. Other countries
take into consideration regulatory changes in order for the
pension funds and the government funds to invest in VC or
fiscal measures to encourage venture capital investments from
foreign VC companies.
However, in the present economic situation, risk capital, like

other sources, remains sometimes inaccessible. Between
2011 and 2012, global venture capital investments
had decreased by 20%, but there are also some signs of
encouragement. For example, among the respondents of
the EY G20 Entrepreneurship Barometer 2013, 63% of the
Indian entrepreneurs, 48% of the Russian ones and 41% from
the Brazilians consider that access to risk capital registered a
turnaround.
A bigger role for corporate investments
Venture capital is less present in Romania, but with the right

incentives from the state, this kind of funding could develop
much more. In India, for example, this kind of investment
has doubled from USD 600 mil. in 2006 to USD 1.4 billion in
2012. According to the European Private Equity and Venture
Capital Association (EVCA), in 2012 only one risk capital
investment was registered in Romania. This was made in the
telecommunication sector and was less than EUR 3 million.
Global Corporate Venturing identified almost 1000 corporate

venture capital funds worldwide. Large corporations offer
capital or loan funding through their own VC funds, like
General Motors (funded in 2010 a subsidiary which invests
USD 100 mil.) or Dell (with a USD 100 mil fund for investing
in startups).
The investments made by the companies from Romania in

start-ups should be encouraged to cover the lack of funding
options.
This kind of investment represents almost 6-10% from
the global risk capital investments. Through this kind of
investments, mature companies have access to future
technologies and financial returns.
In order to support the venture capital investments, the

European institutions are thinking of creating a passport
system to help venture capital companies invest in different
funds and companies from European Union without being
obligated to register in every country they want to operate in.
If we talk about later stage investments in Romania and

in the region, there are private equity and other types of
investment funds that have significant sums available. The
problem is that the business projects do not reach that
stage due to the weak initial seed financing when, as an
entrepreneur, you do not have access to bank financing
and the money from the parents, friends and family are
not enough. You do not have practically any other efficient
solution for funding in order to outgrow this level and reach
the venture capital or private equity phase.
Marius Ghenea, serial entrepreneur (Flamingo, Flanco, FIT,
accessNET, Idilis, Pcfun.ro) and business angel
16

Faza 3: Expansion
Capital markets are extremely important for the companies
which are in the expansion phase. An exponential growth of
the company can be powered only through capital markets.
After becoming public, a company can finance the strategic
acquisitions of other companies, access new markets,
strengthen its brand, while the investors who supported it
by then, the private equity investors, can receive a good exit
opportunity.
Historically, the companies which were listed have
accelerated their job creation rate. For example, in the US,
90% of the jobs created by a company were created after it
was listed.
In Romania, the stock exchange market is still in the
beginning phase, from a liquidity and annual public offers
standing point. FTSE, one of the world leaders in setting
up and determining stock exchange market indexes,
situated the Romanian capital market in the frontier market
segment, in the last fall, due to the low liquidity and high
transaction costs. In 2013, there were two listings at BVB
(Nuclearelectrica and Romgaz) while in 2014 are expected
Hidroelectrica and Electrica.
Junior Markets have a vital role in supporting

entrepreneurs
Not every company will be able to make the step from being a
private company to the main stock market. Junior exchanges,
such as AIM in the UK, can play an important role in bridging
the gap by providing a mechanism for accessing public equity
investment. Listing on a junior market can also have tax
benefits and be a stepping stone to an eventual listing on the
main market.
In the last 10 years, many stock exchanges around the world,
in both mature and rapid-growth markets, have established
junior markets or new platforms to foster capital-raising by
high-growth entrepreneurial businesses.
An important factor in the success of this type of market is
providing a stimulating system for this investments and an
easy access to investments. In Romania, BVB created an
alternative transaction system, ATS, but for the moment it
did not succeed in attracting local companies.
17
Loans can be either cheap or expensive, but what really

matters is the added value they bring to your busines. If the
added valued is significant, it doesnt matter how expensive
the money is.
Felix Ptrcanu studied law to become a judge, but he
became an entrepreneur and CEO of a EUR 60 million
company, FAN Courier.
Medium and large companies and the state should be

encouraged to buy from companies which are at the
beginning of the road, because otherwise the companies
will not develop. For example, it may be a best practice
recommendation that a percentage of public acquisitions to
be granted to start-up companies.
Bogdan Tudor has been interested in computers since high
school. In 2005, he created Class IT company and from
2011 he expanded his business to the US.
Our recommendations
1. Government action: where to focus
Conduct a self-assessment of your entrepreneurial landscape.
This will help to ensure that the correct funding strategies and policy levers are in place and the right type of
capital is available at every stage of the entrepreneurs life cycle.
Provide mentoring along with capital.
Capital without mentorship is lost capital.
Boost access to funding.
Encourage venture capital fund formation, support the creation of specialist banks, sponsor credit guarantee
schemes and low-interest start-up loans, and encourage innovative new approaches such as crowdfunding and
milestone lending.
Support stock markets.
Stimulate access to capital and a greater potential for exits for entrepreneurial growth companies.
2. The entrepreneur perspective: key issues to consider

Ensure that your capital source is the right one.
Seek the right funding depending on where your company is in its life cycle.
3. A corporate perspective
Set up a corporate venturing unit.
Support and access innovative entrepreneurial businesses through corporate venturing.
Trade with entrepreneurs.
Strengthen your supply chain by purchasing from entrepreneurial businesses or providing loans, trade credit or
other forms of support, particularly to those in the early stages of the growth cycle.
18
Entrepreneurship
culture
Entrepreneurship should
be perceived as a valid and
respected career choice and
would-be entrepreneurs need to
feel they will not be excessively
penalized or stigmatized if they
fail.
35%
of Romanian entrepreneurs believe that

the way they are perceived has improved
during last year
Conclusions on entrepreneurship culture

59% of the respondent entrepreneurs
consider that mentalities and
values in Romania do not support
entrepreneurship, compared to 43% of
the entrepreneurs from the European
Union and 29% of G20 countries.
If we take into consideration the
responses of those who consider
that Romania has a positive culture
for entrepreneurs (35%), only
entrepreneurs from Italy, France
and Japan are less optimistic than
Romanians.
When asked about the change in mentalities on entrepreneurship during last year in
Romania, 35% of entrepreneurs believe that it has improved, compared to 26% who
think it has worsened.
When analyzing the responses of entrepreneurs by age, however, there is a
mismatch in perception between young entrepreneurs and the mature ones. Most
young entrepreneurs (46%) believe that the image of entrepreneurs has improved
in 2013 compared to 2012, while the highest proportion of mature entrepreneurs
(34%) thought that it has worsened.
My country has a culture which encourages entrepreneurship
% of entrepreneurs partially or totally agree
China
United States
Canada
India
Mexico
South Africa
Saudi Arabia
Turkey
Argentina
Germany
South Korea
Australia
Indonesia
EU
Russia
Brazil
55%
United Kingdom
Dont know
or no opinion
6%
Romania
Partly
or fully
disagree
59%
Japan
Partly or
fully agree
36%
Media rilor G20
Italy
Is entrepreneurship encouraged by the

Romanian attitudes and values?
France
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Source: EY Entrepreneurship Barometer Romania 2013 and EY G20 Entrepreneurship

Barometer
The perception towards entrepreneurship has improved during the last year in Romania?
Somewhat or greatly deteriorated
Neither improved nor deteriorated
Somewhat or greatly improved
Dont know or not applicable
All entrepreneurs
26%
> 40 years old
35%
34%
13%
< 40 years old

0%
35%
36%
28%
33%
20%
46%
40%
4%
60%
1%
8%
80%
100%
20
Only
5%
of Romanian entrepreneurs
see business failure as a
learning experience

The fear of failure remains one of the significant barriers to
approach entrepreneurship. Only 14% of the respondents
believe that society tolerates business failure, while 81%
believe this failure represents a barrier to future business
projects, a career failure or it indicates lack of necessary skills.
This attitude towards failure indicates that Romanian society
penalizes insolvency and bankruptcy of companies, both from
a regulatory perspective and from the perspective of future
financing options from banks and other investors. When the
company is not successful, the cost of insolvency should be
relatively small.
What do you think about business failure in Romania?
20%
9%
An outcome of running
a business without the
appropiate skills
A career failure
A barrier for future projects
10%
0%
Perception of business failure in Romania, EU and G20 Countries
EU
G20 average
34%
A barrier for
future projects
23%
26%
24%
A career failure
5%
Source: Entrepreneurs Speak Out, Romania 2013
5%
Dont kow or no oppinion
24%
A learning opportunity
30%
The government sent the new Insolvency Code to the

Parliament at the end of 2013, however it has not yet been
adopted. It remains to be seen whether or not the form
adopted will penalize entrepreneurs who fail.
Romania
34%
An outcome that has

no impact on future
business projects
40%
By not overly penalizing honest entrepreneurs who arrive in

this situation, while encouraging private creditors to do the
same, the government can directly reduce one of the most
significant barriers for entrepreneurs. This approach would
reinforce the idea that business failure is part of a learning
process.
21%
An outcome of running
a business without the
appropiate skills
An outcome that has
no impact on future
business projects
12%
4%
29%
23%
20%
9%
6%
A learning
opportunity
5%
Dont kow or
no oppinion
5%
3%
4%
0%
12%
10%
23%
20%
30%
Source: Entrepreneurs Speak Out, Romania 2013 and EY G20

The entrepreneur is a daredevil, a seeker and a fighter who never quits and is always trying to innovate.
Constantin Boromiz, the Boromir group owner, has started as a mill owner in his native village many years ago,
to reach an annual aggregate turnover of EUR 100 million in 2013. He considers himself to be an entrepreneur
since he was 7 years old.
21
40%
40%
50%
52%
of entrepreneurs consider that

communicating success stories has the
greatest impact in promoting a culture
of entrepreneurship

Just like in last years edition of the barometer and in line with
responses of entrepreneurs from European Union, Romanian
entrepreneurs believe that improving the communication
of entrepreneurs success stories and promoting the career
opportunities of entrepreneurship would have the greatest
impact on the image of entrepreneurship in Romania.
Therefore, in order to improve the image of entrepreneurship,

business people believe that messages about entrepreneurs
impact in the economy, through jobs creation and economic
growth, is key. This issue is important, especially in a country
like Romania, where the entrepreneurs role is not yet well
known, because of lack of entrepreneurship in the past
generations.
Given the lack of maturity of the entrepreneurship culture

in Romania, all other listed measures were also considered
important by the entrepreneurs (see below). The only
measure not perceived as such by a significant percentage
of entrepreneurs concerns the Governments programs
in the area of education, funding and improvement of the
entrepreneurship image. The percentage can be explained by
a lack of confidence in the effectiveness of states measures in
the sphere of entrepreneurship.
The communication and celebration of success stories of

Romanian entrepreneurs is even more important. Opening
a business must become a viable career option, a serious
personal achievement and an opportunity for growth and
well-being.
To improve the entrepreneurship culture in Romania, which would be the impact of the factors listed below in the next three years?
High impact
Medium impact
Low impact
Improve communication around entrepreneurs success stories
52%
Promote the career opportunities offered by entrepreneurship
49%
37%
35%
Acceptance of business failure
45%
35%
Government programs providing education,

funding and profile raising
43%
29%
Promotion of the role of entrepreneurs in creating new jobs
41%
Promotion of the high risk/high return dynamics of entrepreneurship
37%
0%
20%
6% 5%
10%
7%
21%
19%
48%
60%
3%
16%
37%
40%
6%
3%
13%
80%
2%
100%
Source: EY Entrepreneurs speak out
We are at the start of the so-called economy of applications

and I believe that at this moment Romanian start-ups with
global products may appear. We need some global business
success stories, and from that point investors will start to
have more courage, and the state will see a real advantage
in encouraging entrepreneurs. The absence of success
stories is probably one of the most important explanations
for not having more entrepreneurs. If there arent any
success stories, why think about becoming an entrepreneur
and work 20 hours out of 24? Wouldnt you prefer to go to a

corporation where you work 8 hours and have a comfortable
life?
The online travel agency Vola.ro owner, Daniel Truic,
became an entrepreneur during college. In 2006, after four
years of entrepreneurship, he started Vola.ro. Now the Vola
group is active on the Romanian market, but also in Poland,
Ukraine and Vietnam. Daniel estimates that Vola group is
worth EUR 27-30 million.
22
14%
of respondents consider that

Romanian society does not
penalize business failure
Improving the perception of entrepreneurship

The role of public policies
in changing the cultural
attitudes regarding
entrepreneurs
The countries that support innovation,
the risk taking of starting a business
and communication on success
stories tend to inspire more people to
become entrepreneurs. Because of
celebrating entrepreneurial success,
The United States ranks first place at
entrepreneurship culture, in the EY G20
Entrepreneurship Barometer 2013.
However, Romania is below the EU
in terms of perceived risk tolerance.
Only 14% of the entrepreneurs who
responded think that business failure
is seen in Romania as a learning
opportunity and that it has no impact on
future business projects.
To encourage entrepreneurship, the authorities may play an important role.

For example, the European Union provides funding for SMEs to increase
competitiveness, from which a significant part is spent on improving
entrepreneurship culture. Another initiative at the European level is the European
SME Week, which in 2014 will take place during 29 September - 5 October. Through
the activities taking place during this week, the European authorities are trying to
inspire more people, especially young people, to become entrepreneurs. During the
European SME Week in 2012, 1,500 events were held in 37 countries from within
the region.
In Romania it is very important for authorities to engage in efforts aimed at
changing attitudes towards entrepreneurs, given that entrepreneurship was
interrupted in Romania during the communist era, when personal initiative was
discouraged and successful businessmen were judged as enemies of the people.
Therefore, even 25 years after we renounced the state governed economy and the
controlled production system, entrepreneurship is still a young concept, which went,
same as the Romanian people, through a process of transition after 1989.
To improve the image of entrepreneurs, the government can support
communication of success stories and the job creation role of entrepreneurship.
These are two measures seen by Romanian entrepreneurs as having great impact in
changing attitudes on entrepreneurs and entrepreneurship.
The positive attitude towards risk in Romania versus the G20 countries:
60%
50%
40%
G20 countries average
30%
29%
20%
United States
China
Indonesia
Saudi Arabia
Argentina
Turkey
Russia
South Africa
Mexico
Australia
South Korea
Canada
India
United Kingdom
Japan
EU
Germany
Italy
France
Romania
0%
Brazil
10%
Source: EY Entrepreneurs Speak Out, Romania 2013 and EY G20 Entrepreneurship Barometer
23
In 1992 it was early enough to become an entrepreneur,

especially that Romanian economy was in a transition
phase to a market economy. I was seen as a strange
character, even more as, in the same time, I had a job at
a state company, where I was earning my everyday living.
Colleagues back then were perceiving me as a little alien.
Florin Furdui, serial entrepreneur and Country Manager,
Portland Trust
When I started my own business in 2005, the concept

of entrepreneur was less common and it was defined as
patron. Patronii had a bad image, being seen as the
person who enslaves and exploits, this is why I tried to avoid
being identified as an owner. Since then, the evolution was
great, entrepreneurs are perceived much better now, even
though the image of entrepreneurs in the Romanian society
as a whole is not immaculate. As a side effect in some circles
to became an entrepreneur is even la mode.
Bogdan Tudorbecame interested in computers in
elementary school. In 2005 he created Class IT and in
2011 he expanded its business in the United States.
Three characteristics of successful

government programs to change cultural
attitudes
1. Facilitates the creation of networking opportunities for
entrepreneurs, helping them to meet other entrepreneurs
and create business connections.
2. They create networking opportunities so that aspiring
entrepreneurs can learn from other businesses in other
regions.
3. They highlight entrepreneurships vital role in the
community and the broader economy, encouraging people
to be proud of this career choice.
Entrepreneurship has become more visible in the media

in the last years and the new generation attitudes towards
entrepreneurship are changing visibly. After the entrance
of corporations in the local economy young people mainly
wanted to take jobs in such companies because it offered them
a good salary and a secure job, however, now taking the risk of
working on your own is no longer perceived as a radical choice.
At the moment, the most visible success stories in the media
are online and tech entrepreneurs. Perhaps not unrelated,
many young people are interested in these industries when
envisaging their first personal entrepreneurial initiative.
Mihaela Matei, coordinator, EY Entrepreneurship Barometer:
Entrepreneurs Speak Out, Romania, 2012 and 2013
Source: EY G20 Entrepreneurship Barometer
Removing the cost and stigma of failure is critical for success

If failure has a high cost, potential entrepreneurs will not choose entrepreneurship. Only 14% of the entrepreneurs say that
Romanians and Romanian institutions have a positive attitude towards business failure, while 81% see it as a barrier to future
business projects, as career failure or lack of necessary skills.
This attitude needs to be changed, especially since the success rate of serial entrepreneurs is higher than the rate of those
entrepreneurs who are at their first business1. This indicates that failure is a valuable learning experience.
Israel provides a good example of how government programs can help to increase risk tolerance: Office of the Chief Scientist
(OCS), a state institution of Israel, provides funding with zero risk, which means that if the newly created company fails, the
funding should not be paid. OCS does not intervene in the management of the company and does not get shares in exchange for
funding. Only companies that are successful are required to pay back the loan.
1
P.A. Gompers et al, Performance Persistence in Entrepreneurship and Venture Capital, Journal of Finance Economics, Vol 96 No 1, 2010
As a young person, you have nothing to lose if you try to

be an entrepreneur. You dont have bank loans, you are
healthy, you have no family responsibilities, children, why
not try it? You should not be afraid of failure, because
if you do not succeed, entrepreneurship will be a great
experience, much better than any prestigious school. Think
of the money invested and lost in the start-up as tuition for

such a school.
became an entrepreneur and the CEO of a business worth
EUR 60 million in 2013, FAN Courier.
24
Improving the perception of entrepreneurship

The European Union recommends offering a
second chance to entrepreneurs who are not
successful with their first company
Policymakers need to target support across

all sections of society
Some segments of the population have little knowledge about
what entrepreneurship means, they lack the self-confidence
required to start a business on their own or they lack funds.
For example, young people are more willing to take the risks
of entrepreneurship, but have less access to finances.
Also, women have a more optimistic economic outlook than
men and repay their loans with a higher probability than men,
yet there are less women entrepreneurs than men.
If the laws governing the institution of insolvency are

tough, they can act as a significant entry barrier for
entrepreneurship. Studies show that the introduction of a
personal bankruptcy law, which Romania does not have at this
time, raises the number of those who become entrepreneurs1.
According to the opinion of the European Commission,
A second chance policy that enables formerly bankrupt
entrepreneurs restart may represent one of the most
promising and under exploited policy options for company
creation and job growth.2
1
In Romania the state has developed two programs aimed

at young entrepreneurs and women. The first, called
The Program for the stimulation of start-up and development
of Small Enterprises by young entrepreneurs, had a budget
of lei 24.300.000 in 2013, while the program dedicated
to women managers in 2013 had a budget of lei 500,000.
For more details see page 15.
J. Armour and D Cumming, Bankruptcy Law and Entrepreneurship,

University of Cambridge Working Paper, No 300, 2005
European Commission, A second chance for entrepreneurs: prevention of
bankruptcy, simplification of bankruptcy procedures and support for a fresh
start, EU Publication Office, 2011
Women: a confident outlook for business growth

What is your level of confidence in the economic direction of your headquarter country?
Extremely confident
Very confident
1%
0%
8%
6%
25%
Confident
33%
Somewhat confident
No confidence at all
46%
6%
0%
55%
20%
10%
20%
30%
40%
50%
% of entrepreneurs surveyed
60%
Male
70%
80%
Female
Source: EY, 2013
Many Romanians still do not understand what

entrepreneurs are. Many still believe that business
should start or must be made by cheating others. Still,
others believe that a business is important to get money
for a luxurious car, for a large house and to get rid of
any financial future problems. Therefore it is important
that young people are informed about what being a
25
businessman (woman) means, what business ethics is and

how successful entrepreneurs did manage to succeed.
So we should start with education and a change in mindset.
Vlad Punescu founded the Castel Film movie studios in
1991. Since then, Castle Films casted and produced over
220 artistic American, European and Romanian movies.
Our recommendations

Promote the power of entrepreneurship as the engine of economic growth.
Celebrate entrepreneurs and position them as role models through marketing campaigns and events.
Removing the stigma of failure.
Statistics show that entrepreneurs are more likely to succeed the second time around promote the view that
failure should be viewed as a learning opportunity.
Creating networking opportunities.
Facilitate opportunities for aspiring entrepreneurs to learn from other businesses.

Share successful stories.
Communicate the benefits of entrepreneurship by publicizing successes in areas such as job creation and
innovation.
Help the next generation of entrepreneurs.
Participate and support formal/informal collaborations and networks to develop entrepreneurs ideas and form
valuable relationships.
Sponsor incubators and accelerators.
Corporations can offer sponsorships or other private programs that support entrepreneurs.
Recognize the contributions and success of entrepreneurs.
Highlight inspirational entrepreneurial case studies to emphasize the importance of entrepreneurs.
26
Tax and regulation
56% of entrepreneurs who

answered our survey consider
simplification of tax and
regulation in Romania would have
a major impact in our business
environment.
72%
of Romanian entrepreneurs consider

that the tax and regulatory system
deteriorated during the last year
Conclusions on tax and regulation

Countries that offer favorable tax rates and simple regulations
also have the highest number of entrepreneurs, who return
to the state and to the community significant tax incomes and
who also create more jobs.
Also, for the open question what is the most important

obstacle for entrepreneurs in starting and developing a
business in Romania, fiscal uncertainty, bureaucracy and the
level of taxes achieved the highest cumulative score: 43%.
However, in Romania tax and regulation are perceived as a

problem by entrepreneurs and 79% of entrepreneurs older
than 40 and 61% of entrepreneurs under 40 believe that tax
and regulation have worsened in the last year in Romania.
Did the regulatory and fiscal environment improve for
entrepreneurs in the last year in Romania?
Which is the most important obstacle for entrepreneurs in

starting and developing a business in Romania?
Neither improved
nor deteriorated
15%
Tax level, fiscal

uncertainty
and red tape
Somewhat or greatly
deteriorated
72%
Dont know
1%
43%
Lack of
entrepreneurship
culture
Somewhat
or greatly
improved
12%
26%
Difficult access
to funding
15%
Political uncertainty
and lack of vision in
public policy
10%
State of the economy

and development gaps
Source: EY Entrepreneurs Speak Out, Romania 2013
6%
0%
10%
20%
30%
40%
50%
Source: EY Entrepreneurs Speak Out, Romania 2013 and EY G20

Do you consider that the regulatory and fiscal environment improved for entrepreneurs in the last year?
> 40 years old
79%
< 40 years old
17%
61%
0%
20%
12%
40%
60%
27%
80%
2% 2%
0%
100%
28

Two solutions considered by entrepreneurs as having the
greatest impact on the development of entrepreneurship
in Romania are ensuring the stability of the regulatory and
fiscal requirements (94% of respondents) and also the
simplification of laws and regulations (91%).
Predictability is extremely important. Keeping proportions,

America maintained a flat price of gasoline from the 50s
to the 80s-90s. This meant a lot to the development of
the United States. Because transport increases the price of
any product you buy. But if the price per gallon is constant,
you can make accurate financial projections. Surely, the tax
environment can not be 100% predictable, however, you do
not want taxes to be changed overnight.
In the G20 countries, 56% of the business people believe

that lowering income taxes especially on small businesses
and simplification of regulations and fiscal requirements
would play a vital role in increasing the attractiveness of
entrepreneurship.

became an entrepreneur instead and the CEO of a business
worth EUR 60 million, FAN Courier.
Just as the funding should take into account the stage of

development in which the company is, regulators should
consider whether the enterprise is in the emerging,
the rapid-growth or in the expansion phase.
To improve the long-term development of entrepreneurship in Romania, what measures do you think would have the greatest
impact over the next three years?
High impact
Medium impact
Low impact
Increase predictibility for tax and regulation
94%
Simplification of tax rules and regulations
91%
Decrease in corporate income tax rates

such as payroll, property taxes
69%
Decrease in corporate income tax burden on small businesses
66%
Decrease in personal income tax rate
20%
5%
34%
41%
60%
5%
5%
18%
41%
40%
7% 1%
13%
35%
40%
0%
14%
25%
16%
56%
Decrease in business registration requirements and costs
5% 2%
20%
41%
Increase incentives for investing in start-ups
24%
58%
Increase in non-tax (cash, subsidies)

focused on innovation
29
9%
54%
Increase in tax incentives focused on innovation
Source: EY Entrepreneurs Speak Out, Romania, 2013
5% 1%
80%
4%
1%
100%

Navigating through complex rules related to taxation or to
industry regulation is a difficult and costly challenge, in terms
of time and financial costs. In addition, the lack of clarity and
open to interpretation regulations are factors that facilitate
the phenomenon of bureaucracy and corruption.
For the companies in the early stages this challenge may
prove fatal, since entrepreneurs have a small amount of
resources to spend, and need to focus mainly on business
development.
To have your activity in the private sector is still seen

as highly problematic, because of the artificially created
difficulties: from an extremely chaotic tax environment, with
hundreds of charges and complicated legislation up to the
institutions that interpret the law by their own will, and the
lack of good manners of the clerk who comes and checks
you up for various reasons. All these factors discourage new
entrepreneurs and are perceived as significant barriers to
entry entrepreneurship.
Florin Furdui, serial entrepreneur and Country Manager,
Portland Trust
Therefore entrepreneurs feel that simplification of tax and

regulations is more important (48%) than income tax
reduction (26%) and indirect tax levels reduction (12%).
At the same time, the fact that entrepreneurs feel the need
for a direct line of communication with the authorities, in
order to express their problems and concerns about the
regulatory environment, indicates the urgent need that
entrepreneurs should be consulted when regulations with
business impact are to be issued.
From my point of view, the state does not help us at all since
many provisions are unclear, and also because you can not
get advice regarding the implementation of those rules from
anywhere. Every time you come in contact with the state,
the interaction is long and bureaucratic. Therefore, we have
assumed the cost of having a relationship with the state, even
though we are a company that by its dimensions does not need
dedicated people for this interaction. Thus we internalized the
accounting and HR function, because it is difficult to navigate
through the complexities of the Romanian regulatory system,
and if you do something wrong, you will be penalized.
Crengua Rou, entrepreneur, co-founder of DC
Communication, one of the top independent communications
agencies on the Romanian market, created in 1995.
Which of the following initiatives would improve the regulatory

environment for entrepreneurs?
The opening of a direct line
of communication to allow
entrepreneurs to express
issues and concerns
41%
43%
38%
Simplification of tax rules

and regulations regarding
calculation of tax liability
22%
21%
Frequent publications of
guidance, instructions and
Q&As to address new and
pending regulations
Reduction of indirect
tax rates
13%
10%
Reduction of personal
income tax burden
11%
13%
Development of a government
agency to assist new
businesses in complying with
regulations
Development of a
government agency to assist
new businesses in complying
with tax filling requirements
25%
30%
0%
10%
Romania
20%
30%
EU
40%
41%
37%
50%
G20 total
48%
26%
21%
26%
Reduction
of corporate income
tax burden
33%
More online accessibility

of regulations and
accompanying information
Which of the following initiatives would improve the fiscal

environment for entrepreneurs?
12%
14%
13%
8%
17%
13%
6%
7%
11%
0% 10% 20% 30% 40% 50% 60%
Romania
EU
G20 total
30
Shaping tax and regulation to encourage entrepreneurship

Policymakers must target tax and regulatory
reform at every stage of the growth journey
Also, fiscal and financial facilities would help them in

research and development activities.
But for all companies, regardless of the stage of the
life cycle, it is very important to simplify existing rules.
Compared with other countries, Romanians feel the need
for simplified laws to a greater extent than other states,
above the EU average, and are overtaken only by Germany,
from the European countries analyzed in the study.
Phase 1: Emerging company

Companies at the seed stage (see graph on page 12) are not
yet generating revenues, meaning that income tax is not very
relevant at this stage. Although income tax usually dominates
the public agenda when speaking of corporate tax, other taxes
(payroll for example) and other aspects of the regulatory
framework influence to a greater manner new business
creation. If the government succeeds to create a friendly
environment, this will facilitate the growth of new companies.
If we consider just the number of bureaucratic tasks that a
company must meet to comply with fiscal requirements, the
conclusion can only be that this represents a very significant
barrier to entry into entrepreneurship. According to a survey
conducted in the European Union in August 2012, of the
Europeans consider starting a business to be too difficult
because of the administrative complexities involved.
The need for simplification of tax and regulation rules

% answered the measure will have a large impact
70%
60%
50%
40%
G20 average
30%
20%
10%
0%
Source: EY Entrepreneurs Speak Out Romania 2013

and EY G20 Entrepreneurship Barometer
In the last World Bank Doing Business ranking, Romania is

ranked on the 136 place out of 185 countries in terms of
taxation. This means that as a company you must make on
average 41 payments every year and spend 216 hours on
average per year to calculate taxes, while the effective rate
for taxation (% profit) for a company is 44.2%.
And if you want to establish your company, according
to the same ranking, the process takes 10 days. In my
case, indeed, only 10 working days passed from the
submission of the complete documents to the emission
of the companys certificate of registration. However, this
was the case because I had specialized help. If you add up
all the time needed to obtain the neighbors approval for
the companys office, name reservation, understanding the
necessary documents, filling them and the time spent in
queue at the Trade Register, it is absolutely understandable
why many Romanians feel discouraged to enter this road.
To register a company is already a test of strength and
motivation for many of them.
Mihaela Matei, Coordinator of the EY Entrepreneur
Speak Out Barometer, Romania 2013 and founder of
Postmodern.ro
31
36%
Japan
Great Britain
France
Turkey
Canada
South Korea
South Africa
Italy
Russia
India
United States
China
Australia
EU
Argentina
Brazil
Saudi Arabia
Romania
Indonesia
Mexico
Germany
Just as funding instruments (see the chapter regarding

access to financing, page 12) must be adapted, tax and
regulation should aim to stimulate the development of
companies based on the stage they find themselves in.
Policymakers can help the mature companies by introducing
deductions from the income tax. For small businesses,
however, such a measure would not be effective, as they
are not yet profitable. For them, incentives such as lowering
the indirect, property and payroll taxes would be more
effective.
As they grow, companies must meet various licensing and

registration requirements, tax rules, industry standards, labor
and employees regulations.
For many entrepreneurs, navigating trough the bureaucracy
of these tasks at various levels (national, regional, local, etc.)
may seem discouraging and may distract them from business
management and growth.
Optimizing cash correlated with indirect taxes

VAT payments may create administrative headaches and cash
problems to small companies and to growing companies . That
is why some countries, including Romania, have taken action
in this regard in order for VAT to be paid to the state when
cashed-in.
Starting with the 1st of January 2014, a major step forward
was made through changes in the VAT collection system.
Companies with a turnover of less than lei 2,250,000 (EUR
500,000) now have the liberty of choosing this system or the
normal system. Also, only now we truly have a VAT charged at
cash-in and not delayed, being removed within 90 days after
VAT became chargeable whether or not the amounts had been
received.
Also, for the companies with a turnover of less than
EUR 35,000 per year, a simplified accounting system with a
structure of reports more easier to draw can be applied.
Incentives for research and development (R&D)
Companies at the start-up stage, particularly those in
innovative hightech sectors, need to invest in people,
equipment and research. To help with the burden, a number
of countries now offer R&D tax credits and tax relief on the
costs associated with product development. Some will also
allow companies to treat capital expenditure as immediate
expenses, rather than amortizing the costs over a period of
time. In the U.S. for example, the 2012 Taxpayer Relief Act
extended both a provision allowing small businesses to claim
an immediate deduction for up to US$500,000 for certain
capital expenditures and a 50% bonus depreciation provision
for qualified property purchases, which is applicable for all
businesses, including early-stage firms.
In many countries, however, these tax incentives are
underutilized, mainly due to a lack of awareness, high
administrative costs or difficulty understanding which
expenses qualify for incentives.
With 0.5% of GDP R&D expense, Romania is in the 48th place

in the ranking of the most innovative countries globally.
In Romania, the companies involved in R&D, or the ones
creating intellectual property, may benefit from two fiscal
facilities:
a) The accelerated amortization (maximum 50% of the
assets fiscal value can be amortized in the first year of
usage).
b) Additional deductions for the eligible expenditures related
to research and development activities, increased since
February 2013 from 20% to 50%.
The last feature went relatively unnoticed and not many
entities decided to benefit from it. It is time for entrepreneurs
who use innovation as the main growth engine to lean on this
legal provision and try to get the maximum benefit from it.
Better communication with policymakers

Asked which single initiative would do most to improve
regulatory environment for entrepreneurs, respondents
in Romania, as well as those from EU, point to the
ability to have a direct channel of communication with
regulators.
The US provides a good example of how governments
are creating forums of this kind. In 2011, a White House
Initiative, Startup America, set up roundtable events in
numerous cities. This provided a forum for entrepreneurs
and investors to discuss barriers to starting and growing
companies. The initiative resulted in a clear set of
recommendations for federal agencies to eliminate
regulations.
Opening a direct communication line would have the greatest
impact on improving regulation
% answered that this measure will have the greatest impact
80%
70%
60%
50%
40%
G20 average
39%
30%
20%
10%
0%
Russia
China
South Corea
Saudi Arabia
Turkey
Italy
South Africa
Mexico
Japan
Brazil
Germany
Romania
Canada
EU
Argentina
Australia
France
Indonesia
India
Great Britain
United States
Second phase: Fast growth
Source: EY Entrepreneurs Speak Out, Romania 2013 and EY G20

32
Conclusions of meetings held by EY

with entrepreneurs in Timioara and Cluj in 2013
During last years meetings with entrepreneurs from Cluj and Timioara, the attending entrepreneurs expressed difficulties
they faced and forwarded recommendations in the areas of financing, entrepreneurship culture, tax and regulation, education
and coordinated support. The major conclusion of the two meetings was that there are many aspects to be changed, however,
the most important issue is the attitude of people entrepreneurs get in contact with or whose actions have an impact on
entrepreneurs, from state clerks, bank clerks, to teachers and politicians.
Romanian entrepreneurs speak out:
Financing
Drastic simplification in accessing EU funds.
Reduction of the review and approval time for these
funds.
Only one authority to coordinate EU funds.
European funds for development of entrepreneurship
and competitiveness in Romania are usually managed
by officials who do not understand the business
environment; they are unprepared and are against
private initiative and entrepreneurship.
Loan analysts in banks should be more knowledgeable
in financial analysis and also in understanding the
business.
Banking bureaucracy must be reduced also.
Making credit conditions more flexible, as, for now,
Romanian banks do not grant funding to Romanian
companies and they do not find any project bankable
enough.
Banks operating in Romania should have a more flexible
and adapted strategy to the Romanian market, yet
their strategy is not in tune with the dynamics of the
Romanian economy.
Banking costs should be reduced.
33
Entrepreneurs have a bad image among Romanians, as a
result of decades in which entrepreneurs were despised
and personal initiative was discouraged. This negative
image is explainable also through recent years media
coverage of negative business models.
The intervention of Romanian National Council of
Audiovisual Content in presenting a balanced picture
would be welcomed.
Also, public national television should have a role in
education of entrepreneurship as a career option.
Conclusions of meetings held by EY

with entrepreneurs in Timioara and Cluj in 2013
Romanian entrepreneurs speak out:
Tax and regulation

Whether we are talking about financial administration,
institutions managing European funds or any other
state institution, red tape is one of the most important
issues with high opportunity costs which should be
reduced drastically, according to entrepreneurs.
At the same time, it is not enough to simplify
procedures and regulations and to reduce the number
of taxes and fiscal declarations, it is also urgent to
professionalize all state employees.
Other recommended measures: trainings and hirings
based on performance of labor force in public
institutions, employment of graduates who have
studied public administration abroad, hiring of those
with business experience.
The predictability of the fiscal environment is extremely
important, as it would lead to better budgeting
forecasts and building appropriate strategies, with long
run perspective.
The tax burden must be lowered, especially labor tax
and tax burden for start-ups.
Also, the insolvency law does not lead to a healthy
business environment, favoring fraud and unfair
practices.
The accounting for small enterprises must be simplified.
Fairness should prevail in the state-entrepreneur
relationship: the state must pay its debts to the
entrepreneur to the same degree the entrepreneur is
required to pay its debts.
Consultations with the business environment is
paramount before changing the tax and regulatory
environment; entrepreneurs highlighted that formal
consultation with no real outcome are not enough and
their point of view should be taken into account.
Education and professional training

Entrepreneurship education should start as soon as
possible, even from middle school, and it must be
taught by entrepreneurs, not by teachers who do not
understand the personality of the entrepreneur and
what business entails.
The education system must be restructured as soon as
possible.
The legislative framework must be improved in order
to allow universities to hire entrepreneurs to teach and
share their personal experiences, thus inspiring new
business initiatives.
Studies with entrepreneurship focus not only are not
taught by personnel with entrepreneurial experience,
but they are based on textbooks presenting foreign
case studies.
Career orientation for children must become functional,
while professional training should meet real needs
of the labor market. At present there is a significant
mismatch between what employers need and the
graduates set of skills.
Also, children must receive positive messages in the
first years of school.
Coordinated support
It would be very helpful if the support from specialized
associations were aggregated in an online portal in
order to raise awareness of what associations, clubs,
incubators, accelerators, state aids can do to help
entrepreneurs.
The specialized associations must not only facilitate
their own members, but all entrepreneurs, in order to
sustain development of the business environment in
Romania.
Entrepreneurs must be more collaborative and
clustered in order to make their voice heard and
better represent their interests.
34
Shaping tax and regulation to encourage entrepreneurship

Phase 3: Expansion
At this stage many companies become profitable and therefore
subject to income tax. In this regard, to an overwhelming
majority, the entrepreneurs whom we interviewed directly,
both in the 2012 and 2013 edition of the Barometer,
pointed out the flat tax of 16% introduced in 2005 to be the
tax measure with the greatest positive impact on business
environment. The measure was interpreted as a positive sign
from gouvernment by the interviewed entrepreneurs, to which
they reacted accordingly.
Many companies at the growth stage start to pursue expansion
into overseas markets. This can be a vital step on the growth
journey, but it also creates significant regulatory and taxation
difficulties. Companies must think about where profits should
be taxed and comply with multiple regulatory frameworks in
the countries in which they operate. This can be a costly and
time consuming process that can eat into the profits generated
by tapping into new geographical markets. There is no easy
solution to this problem, but some governments have tried to
simplify the process and cut down on the regulatory burden.
Businesses that want to expand across the EU can benefit

from the EUGO Points of Single Contact. These online portals
are designed to help entrepreneurs active in the service
sector by setting out information about rules, regulations
and formalities and allowing the completion of certain
administrative procedures online. More could still be done,
however. Better harmonization of tax regulations across the
EU would help entrepreneurs to expand internationally.
Tackling labor market rigidity

Given the continuous economic changes taking place in the
global market, we believe that the labor market must be
flexible to meet the challenges of the global economic crisis
and the jobs shortage. From the entrepreneurs perspective,
flexible working conditions could be achieved by relaxing
terms for termination of individual employment contracts,
for fixed-term employment and also for working time timetable
(e.g. overtime).
The labor legislation in Romania can be characterized as
favorable to employees. Through the changes made to the
Labor Code and the Law on Social Dialogue in 2011, the state
tried to create a more flexible labor legislation by changing
certain provisions regarding probation periods, the fixed-term
employment contracts or more flexible working hours.
The results of these changes are likely to be seen in time.
Tax and regulation issues along the entrepreneurial journey
Pre-seed/seed
Start-up
Develop a business model

Seek funding
Utilize online registration
tools and entrepreneur
development programs
Consider IP protection
Determine legal form and
incorporate
Source: EY G20 Entrepreneurship Barometer
35
Continue to seek funding

Obtain necessary federal,
state and local licenses
Navigate complex tax and
regulation regimes
Consider labor laws when
hiring employees
Pay franchise and indirect
taxes

Rapid-growth/
expansion
Pay income tax upon
generating income
Pay indirect taxes
Consider international
tax rates and
requirements
Manage large-scale
severance and
redundancy; consider
international labour
laws
Our recommendations
Simplify the tax system.
This would allow entrepreneurs to focus on what they do best: growing their business, generating jobs and driving
innovation.
Make it easier to navigate the tax system.
Create a single platform that provides practical and easy to understand guidance.
Give entrepreneurs a voice on regulation.
Include their input on significant regulation, ensure representation on committees and in government by
creating a minister of entrepreneurship to represent their views and draft a national strategy of entrepreneurship
development.
Simplify insolvency rules.
Revise legislation to help entrepreneurs recover from failure by reducing the cost of business failure.
Reduce the indirect tax burden.
Early stage companies would benefit significantly from relief on indirect taxes such as payroll and sales levies,
which often serve as a fixed overhead expense, negatively impacting cash flow and profit and loss.

Explore governmental resources.
Seek out and make use of government-funded resources and tools to reduce business start-up time.
Know the R&D incentives.
Be aware of and capitalize on investment incentives for R&D and entrepreneurship to further your business.
Get involved in the development of entrepreneurship environment.
Be active and insert yourself into the consultation processes, particularly on proposed legislation that will impact
entrepreneurs.
Decrease costs of tax compliance.
Use the simplified taxation methods to improve cash flow and reduce costs of tax compliance.
Share your public policy experience.
Your knowledge, learnings and capabilities will benefit entrepreneurial companies.
Drive change.
Lobby government to incentivize corporations to invest in entrepreneurs.
36
Education
and training
There is a direct relationship

between investment in education
and GDP growth. This relationship
should by even stronger if
education were better oriented
towards the development
of knowledge, aspirations
and attitudes required to
entrepreneurs.
58%
of entrepreneurs consider that

entrepreneurship education
improved during 2013
Conclusions on education and training

The only net positive perceptions of Romanian entrepreneurs
who answered our survey are related to education. According
to the Barometer, entrepreneurship education has improved
in the last year in Romania, 58% of entrepreneurs supporting
this statement.
When it comes to entrepreneurship education we must

consider not only formal education business administration,
marketing, sales, human resources, communications and PR,
finance but also coming into contact with entrepreneurial
models.
Positive perception on entrepreneurship education remains

the same when answers are segmented by age, with a
higher percentage of young entrepreneurs supporting this
perception (70%).
Therefore, entrepreneurship education is different from

traditional and academic education and it also involves
creating unique attitudes which can develop only
through contact with entrepreneurial success stories and
entrepreneurs. But just as important, young people need
to understand not just a romanticized interpretation of
entrepreneurship, but also the negative aspects of starting
a business.
Do you believe that education and training focused on

entrepreneurship have improved in the last year in Romania?
Dont know
or no opinion
5%
Do you believe that education and training focused on

entrepreneurship have improved in the last year in Romania?
Segmented by age
Neither
improved or
deteriorated
23%
Somewhat
or greatly
deteriorated
14%
Somewhat
or greatly
improved
58%
20%
> 40 years old
< 40 years old 6%

0%
22%
51%
24%
20%
8%
70%
40%
60%
80%
100%
I found being an entrepreneur very hard in the beginning,

because I did not have strong entrepreneurial education,
I especially exceled in operations and IT logic. If I had to
choose the best measure that should be taken to support
entrepreneurs, this would be to prepare the entrepreneurs
in business administration, sales, marketing, finance.
Education in all these areas is crucial. Helping entrepreneurs

with funding is not enough.
Bogdan Tudor has been interested in computers since high
school. In 2005, he created Class IT company and from
2011 he expanded his business to the US.
38

Specific programs for entrepreneurship and business schools
(56% of responses) are for Romanian entrepreneurs the
most important forms of education to improve the perception
of entrepreneurship as career choice in Romania. At the
same time, success stories (18%) of entrepreneurs, as well
as mentoring programs (18%) are not perceived as being so
important. The measure which received the fewest responses
is related to state efforts to educate entrepreneurs, with only
8% of votes.
Compared with entrepreneurs in other countries, we are

among the last who see the potential of success stories in
entrepreneurship education and the first in terms of the
perceived importance of formal tertiary education.
This latter type of education would be best supported by
government measures, given that universities in Romania are
mostly state owned. However, when asked which would be the
most effective form of support provided by the government,
entrepreneurs did not choose education as a possible
measure.
Entrepreneurs perception of promoting success stories of entrepreneurs to students in order to improve the idea of
entrepreneurship as a career option
50%
45%
40%
35%
30%
G20 average
29%
25%
20%
15%
10%
5%
South Africa
Canada
Australia
Great Britain
Argentina
India
France
EU
Mexico
United States
Russia
Japoan
Turkey
Germany
Italy
Indonesia
Saudi Arabia
China
South Korea
Romania
Brazil
0%
Source: EY Entrepreneurs Speak Out Romania 2013 and EY G20 Entrepreneurship Barometer
Entrepreneurs perception of the effect of specific programs in universities / business schools on the perception of entrepreneurship
as a career option
60%
50%
40%
G20 average
30%
29%
20%
39
Romania
Brazil
United States
Mexico
Italy
India
Argentina
France
Russia
Indonesia
Germany
Japan
EU
Turkey
Great Britain
Australia
South Korea
Canada
China
South Africa
0%
Saudi Arabia
10%
80%
of the Romanian entrepreneurs

coach the entrepreneurs who are
at the beginning of the road

Once you have become an entrepreneur, the advice given by
mature entrepreneurs, who have met and overcome mental,
operational, financial and all the other usual obstacles on the
entrepreneurship road, becomes extremely important.
80% of the surveyed entrepreneurs said that they provide
such advice and train other entrepreneurs in an informal
or formal way. Also, most of the directly interviewed
entrepreneurs said that they provide mentoring. For example,
many of them teach in workshops and programs of
The Romanian Business Leaders Foundation and also in the
youth organization Junior Achievement Romania.
As an experienced entrepreneur, do you provide

training/coaching/mentoring to the young or starting up
entrepreneurs?
No
20%
Yes, in an
organized
manner
23%
Yes, in an
informal
manner
57%
Source: EY Entrepreneurs Speak Out in Romania, 2013
Business angels also coach the businesses in which they

invest, while most entrepreneurs try to inspire those around
them to take the risk of working on their own.
In addition to direct mentoring, informal meetings with
other entrepreneurs in dedicated clubs or networks are
very important, as they receive information from other
entrepreneurs when they mostly need it.
Business incubators and accelerators in Romania should also
offer know-how and coaching.
Many business incubators and accelerators in Romania,

unfortunately, work as real-estate businesses, meaning that
they have some space and try to make it valuable by offering
it to entrepreneurs. This is not enough. An incubator or an
accelerator must provide elements of networking, funding,
mentoring and entrepreneurship education.
Marius Ghenea, serial entrepreneur (Flamingo, Flanco, FIT,
accessNET, Idilis, PCfun.ro) and business angel
Im mentoring because this is an early culture I have

become accustomed to in my professional career. I myself
am the product of mentoring received from German and
Austrian business people. Now I have 10 companies in which
I invested and, in addition to the operational part, the daily
conversations with their CEOs focus on mentoring. Sometimes
our communication is 20% operational and 80% business
sharing experiences and lessons learned in time.
Businessman Ion Sturza left the Rompetrol group in
September 2009 to create the investment fund Greenlight
Invest, later rebranded as Fribourg Capital, an investment
fund specialized in private equity and venture capital. In
December 2013 Sturza inaugurated in Cluj The Liberty
technology park and Spherik business accelerator.
40
Steve Jobs gave up his university studies

Do entrepreneurs need studies?
While there are numerous examples of well-known business
personalities who did not finish formal education, research
has shown that education generally makes entrepreneurs
more likely to succeed. A detailed study using US labor force
data found that entrepreneurs on average earn more for
every year of formal education1.
In rapid-growth markets, a lack of education is a key barrier
to entrepreneurship. A key role for government is to ensure
that a countrys citizens have access to good education. This
should include formal education and more specific business
education targeted at business owners.
On the other hand, educational spending alone does not
necessarily lead to more successful entrepreneurs,
as often traditional education creates good employees,
but not entrepreneurs able to take risks. Therefore,
traditional curricula often does not help in the development
of entrepreneurial spirit and the expenditures made by the
state for this kind of education will not necessarily lead to
good results. Researches carried out in EU have shown that
as the level of education increases the chances
for students to become entrepreneurs fall2.
41
M van Praag et al, Returns for Entrepreneurs versus Employees: The Effect of
Education and Personal Control on The Relative Performance of Entrepreneurs
vs. Wage Employees, Forschungsinstitut zur Zukunft der Arbeit Discussion
Paper, 2009
European Commission, Effects and Impact of entrepreneurship programmes in
higher education, EU Publication Office, 2012
This determines the conclusion that rigid studies, even if they

focus on developing specific skills needed by entrepreneurs,
may not lead students to assume the risk of entrepreneurship,
innovation and experiment.
Therefore it is necessary that entrepreneurship be taught by
entrepreneurs who speak from their own experience, both
positive and negative, thus inspiring this career choice among
students. That is why 52% of Romanian respondents consider
a better communication of success stories of entrepreneurs
as the best method for changing perceptions towards
entrepreneurship in Romania.

Focus on the young
Early exposure to entrepreneurship in the education syllabus
helps children to develop the skills and values that will be
required for entrepreneurship later in life. In some countries,
schools will bring in role models and set up games and
competitions that give students the chance to find out what it
is like to run a business. Very often, students respond well to
this because learning about entrepreneurship involves a more
hands on approach compared with some other traditional
academic subjects.
When referring to secondary education (primary and
middle school), about 33% of entrepreneurs in the
European Union estimate that it has improved in the
last three years. This perception reflects the increased
interest in Europe for entrepreneurship education during
the recent years, stimulated by the rising unemployment
in the member countries. Vocational education, such as
vocational schools, also experienced an improvement in
the European Union during the same period, according to
34% of European respondents - a good sign considering the
de-professionalization at this level and acute shortage of
craftsmen in Romania.
The European Union makes the entrepreneurship

education a compulsory subject within secondary
education
Stimulating entrepreneurship is one of the four long-term
objectives of the EUs current vision for education, called
Education and Training 2020. Already in 14 out of 27 EU
countries, students are taught about entrepreneurship as an
element of a compulsory subject during secondary school
most often in the social sciences. In Romania, Poland and
Lithuania, a specific course in entrepreneurship is mandatory.
In Romania, this discipline became compulsory in 2010.
42

The entrepreneurship subject is too new in the education
curricula in Romania to be able to assess the results.
Nevertheless, previous research shows that starting young
can have a huge impact. It reports that between 15% and 20%
of students who participate in a mini-company program in
secondary school go on to start their own business. For the
general population, the figure is typically three to six times
lower.
In Romania, the entrepreneurship education subject consists
of significant elements of entrepreneurship, how can students
choose their professional path and career, what are the
qualities and skills of successful entrepreneurs, market
opportunities analysis, business valuation and business ethics,
and notions about the business plan and business risk.
The European Union plan for

entrepreneurship
The European Union Action Plan sets that study of
entrepreneurship should be integrated at the primary
level, secondary level, vocational and tertiary education
by 2015.
The objective seems very ambitious, given that
not all EU countries have yet a specific strategy for
entrepreneurial education.
General and specific competencies to be obtained by the

students attending the subject promote the following values
and attitudes:
Independence in thinking and action
Positive relationships with the others
Responsibility in the entrepreneurship activity
Free will
Economic efficiency
The government and the country strategy are essential

in supporting entrepreneurship, particularly when
referring to education. If the education strategy on
entrepreneurship education is not properly designed,
future generations will not have a sound basis becoming
entrepreneurs. Drafting the education strategy should be
a responsibility not only for the Ministry of Education,
43
but also for the Ministry of SMEs, Ministry of Labor and

other ministries. If you make entrepreneurship education
in the early years of school, young adults may knowingly
decide to choose the path of entrepreneurship.
Marius Ghenea, serial entrepreneur (Flamingo, Flanco,
FIT, accessNET, Idilis, PCfun.ro) and business angel
Our recommendations
Support young people who chose an entrepreneurial career.
Create public programs for those who are looking to start a business and need to develop specific
entrepreneurship and business skills.
Encourage lifelong learning for entrepreneurs.
Many of the skills that entrepreneurs need cannot be learned in a classroom. Create more opportunities for
peer-to-peer learning, through mentorship programs and entrepreneur support clubs.

Look for the educational opportunities that suit your needs.
This may range from an MBA to taking a short course to develop a specific skill or fill a knowledge gap.
Seek out and learn from other entrepreneurs.
Your idea may be unique, but you are more likely to succeed if you tap into the experience of others.
Give back to help others.
Good entrepreneurship education programs rely on input from current entrepreneurs.
Mentoring also actively assists the next generation of entrepreneurs and introduces new talent into existing
networks.
Expand internship programs to provide more hands-on experience.
EY researches showed that approximately 60% of entrepreneurs gained skills and competencies in a corporate
environment.
Mentor entrepreneurs.
Encourage leaders from your corporation to provide entrepreneurs with valuable knowledge and insights.
44
Coordinated
support
Funding, education, entrepreneurship
culture and taxes - all must encourage
entrepreneurship, while specialized
organizations, including government
ones, have to optimize the way
in which the entrepreneurship
environment develops harmoniously
at all relevant levels.
45
40%
of entrepreneurs consider
that coordinated support in
Romania has improved in
2013.
Conclusions on coordinated support

Most of the Romanian entrepreneurs consider that
coordinated support provided by specialized organizations
such as clubs and associations of entrepreneurs, informal
networks of entrepreneurs, government agencies, business
incubators and accelerators, has improved in the last year.
By taking into consideration the age groups, as well as
perceptions about financing, entrepreneurial culture and
entrepreneurship education, young entrepreneurs are more
optimistic: nearly 50% consider specialized organizations offer
better support than a year ago.
Did the coordinated support provided by specialized
organizations improve over the last year in Romania?
Neither
improved or
deteriorated
31%
When asked how could the government help them, most

of the Romanian entrepreneurs chose credit schemes
for small entrepreneurs, with a percentage significantly
higher than at EU level. The other two measures chosen by
Romanian entrepreneurs have a strong financial component,
while supporting education did not receive any vote. This
result recalls the great need for funding of the Romanian
entrepreneurs, who believe that access to financing is difficult
or very difficult (88% of answers).
Did the coordinated support provided by specialized

organizations improve over the last year in Romania?
By age
Somewhat
or greatly
improved
40%
< 40 years old

Somewhat
or greatly
deteriorated
11%
15%
> 40 years old
6%
0%
Cant tell
18%
31%
35%
30%
48%
20%
40%
Somewhat or greatly
deteriorated
Somewhat or greatly
improved
20%
15%
60%
80%
100%
Neither improved nor

deteriorated
Dont know or not
applicable
Which of the following forms of support provided by the government would be most effective for entrepreneurs?
Small business lending schemes
Government start-up/other programs, including grants
Loan guarantees
Government-sponsored university incubators
Entrepreneurial workshops
Industry-specific training programs
Support tailored to female entrepreneurs
Sponsored industry/entrepreneur forums and networking
Educators
Small business administration support
0%
5%
10%
15%
20%
25%
Romania
30%
35%
EU
46

Credit schemes for small entrepreneurs are perceived as
the most important measure of government support for
entrepreneurs in Romania, well above the EU average,
with 29% of responses.
These answers show the need of Romanian entrepreneurs to

be supported by the state. Government programs may relate
to grants, credit or equity financing, tax breaks, and even
networking and mentoring opportunities.
In the European Union the most favored measures are

government programs for start-ups and loan guarantees,
ranking in the second and third place in the preferences of
Romanian entrepreneurs.
However, on a par with government programs, entrepreneurs

indicate that clubs and associations of entrepreneurs
have the same importance on the long term in developing
entrepreneurship. Incubators/accelerators rank only the forth
place in the preferences of Romanian entrepreneurs, probably
because few are truly functional in Romania at the moment.
Only 1% of responses goes to chambers of commerce.
When asked about the action/organization that would have

the greatest impact, entrepreneurs point to the government,
through its programs dedicated to start-ups
and entrepreneurs.
Credit schemes for small entrepreneurs would be the most

effective support measure from the government
% of responses
30%
20%
G20 average
13%
Mexico
USA
Japan
Great Britain
China
India
Argentina
Romania
United Arab Emirates
0%
Italy
France
South Korea
Canada
Germany
EU
South Africa
Indonesia
Brazil
Australia
Turkey
Russia
10%
It is hard to believe that many capitalists of major

importance would appear from only one generation of
entrepreneurs, therefore small and medium entrepreneurs,
the backbone of the economy, must be supported in
Romania. And the support does not necessarily have to
come from the central authorities, but also from the local
ones through: optimization of association requirements,
creation of industrial platforms for SMEs, improvement of
training and other measures which can make a difference
for small and medium entrepreneurs.
Businessman Ion Sturza left the group Rompetrol in
September 2009 to create the investment fund Greenlight
Invest, later rebranded as Fribourg Capital, specialized
investment fund in private equity and venture capital.
In December 2013 Ion Sturza inaugurated the Liberty
technological park and Spherik business accelerator in Cluj.
In order to improve the long-term development of entrepreneurship in Romania, which of the following organization/initiative do you
think would have the greatest impact?
Government start-up/other programs
Entrepreneur clubs and associations
Teaming/mentor programs
Business incubators & accelerators
Entrepreneurial workshop/support meetings
University incubators
Industry-specific training porgrams
Venture capital associations
Corporate and non-governmental advisors
Educators
Chambers of commerce
Small business administrations
Other
0%
2%
4%
47
6%
8%
10%
12%
Romania
14%
16%
UE
18%
48%
of entrepreneurs participated
in meetings and workshops
for networking and knowledge
sharing

While in Romania the initiatives most attended to by
entrepreneurs were meetings (formal or informal) and
workshops for entrepreneurs (48% of entrepreneurs), most
entrepreneurs (63%) in the European Union chose to be part
of entrepreneurial clubs and associations.
Meanwhile, the Romanian entrepreneurs look forward to

attend most to entrepreneurship meetings and workshops,
take part in governmental programs for start-ups and other
governmental programs.
Which of the following initiatives have you used or do you intend to use in the following 3 years?
- Romanian entrepreneurs
I use or have used them
I plan to use them
Entrepreneurial workshops/support meetings
48%
Entrepreneurs clubs and associations
20%
Educators
Small business administration
56%
20%
59%
14%
17%
11%
69%
14%
7%
55%
20%
24%
35%
24%
20%
25%
Chamber of commerce
30%
25%
41%
75%
7%
86%
7%
66%
27%
Government agencies
5%
17%
Incubators/accelerators in universities
1%
19%
0%
23%
30%
45%
Industry specific training programs
Business incubators
78%
80%
20%
40%
60%
80%
100%
Which of the following initiatives have you used or you intend to use in the following 3 years?
- EU entrepreneurs
I use or have used them
I plan to use them
Entrepreneurial workshops/support meetings
48%
Entrepreneurs clubs and associations
23%
63%
Industry specific training programs
32%
28%
Chamber of commerce
Educators
20%
58%
16%
23%
21%
16%
22%
53%
60%
66%
62%
38%
20%
0%
38%
20%
18%
12%
Government agencies
20%
44%
47%
25%
Small business administration
Incubators/accelerators in universities
29%
17%
24%
42%
23%
31%

Business incubators
26%
36%
19%
20%
61%
40%
60%
80%
100%
48
Growing an integrated ecosystem

Successful entrepreneurial ecosystems comprise many
essential components that must function well as a whole. For
example, funding is not effective without mentoring; same is
financing without a risk-taking culture. Also, entrepreneurs
will consider excessive tax burdens and bureaucracy a too high
barrier to entry, regardless if the other elements are fulfilled.
This ecosystem must serve the needs of all stages of
entrepreneurship otherwise the chain is broken and
companies do not reach maturity. While early-stage ventures
can be supported through business incubators, for example,
companies that have moved beyond the start-up phase need
other types of support, such as help accessing capital markets
or internationalizing their business. Along the way, support
should also be in place to help link small businesses with
larger, established companies.
Enterprise Europe Network

Enterprise Europe Network (EEB) is an instrument from
the EUs strategy on entrepreneurship, economic growth
and job creation.
This network includes more than 600 organizations
supporting entrepreneurship in 50 countries.
In addition to the advisory offered on regulation and
European standards, EEN organizations support
business generation and their development by access
to finance, technology transfer, intellectual property,
international collaborations, R&D funding, exports, both
in the EU and outside.
The entrepreneurial development framework: five pillars that foster entrepreneurship
Enabling entrepreneurs
to learn from large
corporations
Access to funding:
Tax and regulation
Seed
Taxation incentives
Start-up
Ease of starting a business
Frances SME Pact is a joint venture

between OSEO (the French
Governments innovation agency)
and 14 business organizations.
Expansion
Business-friendly legislation/policies
Its objective is to stimulate

entrepreneurial growth by acting as
a bridge between entrepreneurial
businesses and large companies,
through commercial contracts and
R&D collaborations.
Large multinationals sign the SME
Pact voluntarily and commit to
increasing their collaboration with
entrepreneurial businesses.
Capital growth
Coordinated support
Mentors, advisors,
networks and clubs,
Business incubators,
clusters, parks and
business centers
Education and training
Pre-university education
Tolerance of risk and failure
University education
Preference for self-employment
Entrepreneurship-specific training
Informal education/lifelong learning
49
Innovation and research culture

Celebration of self-made wealth

Clusters create a thriving environment for
entrepreneurs
Clusters of companies in a particular geographic area drive
and stimulate the entrepreneurship initiative. As it happens
in Silicon Valley or, keeping proportions, on the Dacia Mioveni
platform, the fact that interconnected firms, suppliers and
related industries appear in proximity to each other, facilitates
the exchange of ideas and resources.
Clustering is a natural phenomenon on which governments
can capitalize to streamline investments. For example, there
was talk about the existence/emergence of an IT cluster in Cluj
in the last years. Such an ecosystem can not be controlled,
because it evolves naturally, but it can be helped through
government measures. For example, at a certain time, such a
cluster can hit certain legislative and regulatory barriers that
government can help to overcome.
Several regional hubs or clusters are emerging or expanding
within the EU, including a number of technology hubs that are
gaining momentum. Some key examples include the following:
London s Tech Investment City Organization which has
helped to develop the area known as Tech City, or Silicon
Roundabout.
Conditions that define a healthy

ecosystem for entrepreneurs
The ecosystem is tailored around its own
unique environment.
It operates in an environment with reduced
bureaucratic obstacles, in which government
policies support the unique needs of
entrepreneurs and tolerate failed ventures.
It actively encourages and invites financiers to
participate in new ventures.
The ecosystem is reinforced, not created
from scratch, by government, academic or
commercial organizations.
It is relatively free from, or is able to change,
cultural biases against failure or operating a
business.
Berlin s Communication, Media and Creative Industries

Cluster which gathers more than 27,000 companies
employing more than 220,000 employees.
Regarding Bucharest, the emergence of an R&D in Magurele,
by means of ELI-NP project of the largest laser in the world is
a promising project. The project will reach a total investment
of EUR 356 million and it will involve 13 European Union
member states.
We have no chance to replicate Silicon Valley in Romania,

as it is impossible for New York, Geneva or Toronto to
replicate it. Silicon Valley is a unique phenomenon which
now functions as a huge vacuum of ideas and money. We
could talk at Liberty Technology Park in Cluj about a Silicon
Valley as it was 20-30 years ago when the emphasis was
on high added value production. This is the model we try
to implement in Cluj, because IT outsourcing cant be the
future, as well as lohn clothing production was not.
We will select promising projects, we will incubate,

accelerate, mentor them, and then well go to Silicon Valley
to showcase them.
Ion Sturza left Rompetrol Group in September 2009
to create the investment fund Greenlight Invest, later
rebranded as Fribourg Capital, a specialized investment fund
in private equity and venture capital. In December 2013,
Ion Sturza inaugurated the Liberty Technological Park and
Spherik business accelerator in Cluj.
50

Entrepreneurs rely on contacts, mentors
and associations
Entrepreneurs meet in clubs, associations, workshops,
support meetings, informal support and mentoring. This
reflects a prevailing tendency for entrepreneurs to rely heavily
on relationships with groups of people in similar businesses or
those with advanced or relevant experience.
Networks, mentoring programs and workshops are naturally
easier to facilitate when participants are all in close geographic
proximity. In a self-perpetuating process, such groupings
then become magnets for entrepreneurs. However, these
networks become more powerful when they can draw on more
established and experienced entrepreneurs who are willing to
act as role models and advisors.
Incubators can help businesses, customers,

suppliers and strategic partners become
self-sufficient
Business incubators help turn ideas into businesses by
providing much more than office space and seed capital in
return for equity. They teach and mentor entrepreneurs while
introducing new contacts, investors and networks.
Incubators can be highly relevant in countries where
entrepreneurship is not a tradition, such as Romania and
where contact networks, entrepreneurship education and
funding systems are not yet advanced.
How Israel became an incubator for entrepreneurs
Universities have a key role in coordinating

government-funded activity
Universities are another vital part of many entrepreneurial
ecosystems. Recent research shows that the impact of
university innovation increases with geographic proximity to
the university.
For example, a university with a strong biotech faculty
will typically correspond with greater biotech-related
entrepreneurial activity nearby. An OECD study concludes that
governments should enact policies that directly link university
research and start-up formation. These include providing
funds for joint research, facilitating technology transfer and
coordinating seed funding for university spin-offs.
Israel is one of the worlds most innovative and

entrepreneurial economies. The state has invested
heavily in entrepreneurship and innovation, and now
there is a start-up for every 1,844 inhabitants, the
highest density of start-ups in the world.
Besides help them begin, the state also helps them
grow. For example, Israel has more companies listed on
NASDAQ than whole Europe.
In 2008, Israel received 2.5 times more venture capital
investments per capita than the United States.
About 45% of Israelis go to university, one of the worlds
highest attendance levels.
Israels informal culture de-emphasizes status and age
but recognizes talent and drive.
Israels infrastructure supports entrepreneurship with
venture capital, R&D funding, and a large number of
scientists and engineers.
Our main reason for optimism is that we see more and better
coagulation of the tech community, whether we are talking
about entrepreneurs, designers, programmers or specialists
from nearby areas. Better communication between them will
lead to close cooperation. Our role is to support them in their
efforts, while facilitating our hub to connect other technology
hubs around the world.
The help that we offer specifically for entrepreneurs who
are just starting out is an affordable workspace, as residents
or co-workers. Also we organize weekly events for the
community. These events are designed to bring closer
experienced people - entrepreneurs or specialists in the area
of technology, business angels and potential investors - and
those who want to create or to grow a start-up or even to
engage in one.
51
We facilitate one-on-one meetings with these experts and

generate contexts in which start-ups get feedback from
potential investors and serial entrepreneurs in mentoring
sessions to improve their products.
The need for feedback is an important one, but the fear of
failure still floats over the attempts to expose entrepreneurs
to an audience, whether specialized or uninformed. Also, the
small number of angel investors is a loophole that makes the
transition from one stage of financing to the next difficult.
But despite the challenges, we believe in the potential for
further innovation and commercial success of start-ups made
in Romania.
Daniel Dragomir, CEO TechHub Bucharest, community and
coworking space for tech entrepreneurs
Our recommendations
Create clusters to accelerate entrepreneurship.
Nurture clusters of entrepreneurial companies in a single location to boost existing strengths, provide scale,
improve productivity and enhance international visibility.
Build stronger links between different players in the ecosystem.
Create facilities and events that allow networking to flourish. Clubs, associations, workshops, support meetings,
informal support and mentoring all help.
Support and improve incubators and accelerators.
They form a vital link between aspiring entrepreneurs and existing businesses, funding bodies, mentors and
support agencies.

Capitalize on networks.
Be proactive about connecting with available networks, and seek out a mentor or form a board of advisors.
Give back.
Share ideas, useful contacts and basic advice: it can make a huge difference.
Join an incubator or accelerator.
This generates exposure and feedback for the business, and that helps to build the company.
Choose your location carefully.
Clusters can accelerate your growth through synergies with similar firms, suppliers, research centers and
universities.
Not-for-profit organizations play an important role.
It is important to seek the assistance of not-for-profit organizations, like The Romanian Business Leaders
Foundation.
Access innovation.
The creation of corporate incubator or accelerator programs can help provide entrepreneurs with access to
resources, testing facilities, pilot customers and funding.
Connect with entrepreneurs.
Sponsoring and participating in events help to connect a range of people to the entrepreneurial ecosystem.
52
Methodology
For the second edition of The Entrepreneurs Speak Out
Entrepreneurship Barometer, our analysis of the
entrepreneurship environment in Romania was articulated
around five enablers: access to funding, tax and regulation,
education and training, entrepreneurship culture
and coordinated support defined by the G20 Young
Entrepreneurs Alliance in Toronto, Canada
(20-22 June 2010).
Our analysis is based on four building blocks: a perception

survey conducted with 106 Romanian entrepreneurs between
7 November 2013 - 16 January 2014, qualitative interviews
with relevant entrepreneurs, macroeconomic indicators, and
an analysis of Governments leading practices.
Abreviations
AIM - Alternative Investment Market is a sub-market of the
London Stock Exchange, allowing smaller companies to float
shares with a more flexible regulatory system than is applicable
to the main market.
AIPPIMM The Romanian agency that implements projects
and financing programs for SMEs
ATS The alternative transaction system is a sub-market of the
Bucharest Stock Exchange
G20 Forum for the governments and central bank governors

from 20 major economies. The members include 19 individual
countriesArgentina, Australia, Brazil, Canada, China, France,
Germany, India, Indonesia, Italy, Japan, Republic of Korea,
Mexico, Russian Federation, Saudi Arabia, South Africa, Turkey,
United Kingdom, United Statesand the European Union
SMEs Small and medium enterprises
IPO - Intial public offering
EBRD European Bank for Reconstruction and Development
IT Information technology
BVB Bucharest Stock Exchange
JEREMIE Joint European Resources for Micro to Medium

Enterprises is a joint initiative developed by the European
Commission in co-operation with the European Investment Bank
Group and other financial institutions in the framework of the
2007-2013 programming period in order to make cohesion
policy more efficient and sustainable
R&D Research and development

CIP - Competitiveness and Innovation Framework Programme
of European Union
CEO - Chief Executive Officer
COSME - EU programme for the Competitiveness of Enterprises
and Small and Medium-sized Enterprises
EIB European Investment Bank
EIM Independent organization of research and consultancy
ELI-NP Center of research Extreme Light Infrastructure
Nuclear Physics
OCS Office of the Chief Scientist one of the Israels

entrepreneurship programs
OECD - Organisation for Economic Co-operation and
Development
OSEO - Private enterprise with public service delegation, which
finances French SMEs
PE Private equity
EUGO European network of points of single contact,

e-government portals for entrepreneurs active in the service
sector
GDP Gross domestic product
EUR EU countries currency (Euro)
SBA Small Business Administration
EVCA The European Private Equity and Venture Capital

Association
SVB - Silicon Valley Bank
FTSE - Subsidiary of the London Stock Exchange, global leader

in indexing
PR Public relations
VAT Valued added tax

EU European Union
USD United States Dollar
VC Venture capital
53
Demographics
Position in the company
Other
4%
Shareholder
(not involved in the
business)
1%
President/Chairman
of The Board
19%
Shareholder
(involved in the
business)
46%
CEO/Vice-President/
Executive Director
35%
Age
18-29 years old
7%
30-40 years old

30%
> 40 years old

63%
54
Demographics
Companys income
< EUR1mil
25%
> EUR15mil
28%
Between
EUR10-15mil
9%
Between
EUR1-5mil
23%
Between
EUR5-10mil
15%
Industry
Other services 8%
Textile industry 1%
Agribusiness 1%
Furniture 1%
IT
19%
Energy 1%
Electrical equipment 2%
Oil & Gas 2%
Healthcare 3%
Heavy industry 3%
Business
services
13%
Transportation 3%
Chemicals 3%
Automotive 4%
Commerce
12%
Hospitality 4%
Food 5%
Construction 5%
Media &
advertising
9%
55
Financial services 7%
Our leaders at EY Romania
Bogdan Ion
Country
Managing Partner
Anamaria Cora
Partener
Head of Assurance
Saulius Adomaitis
Partener
Head of Advisory
Florin Vasilic
Partener
Head of Transaction Advisory
Venkatesh Srinivasan
Partener
Head of Tax and Legal
Drago Radu
Partener
Head of Legal
Project team
Mihaela Matei
Special Projects
Communication Officer
Constantin Mgdlina
Knowledge Management
Officer
Elena Badea
Head of Market
Enablement
Coordinator of EY Entrepreneurs
Speak Out Entrepreneurship
Barometer
Thank you!
We would like to thank all the entrepreneurs who responded to our survey, those who shared
their thoughts with us, as well Wall-street.ro and Romanian Business Leaders for their support.
57
EY | Assurance | Tax | Transactions | Advisory
Our contact details
About EY
EY is a global leader in assurance, tax, transaction
and advisory services. The insights and quality
services we deliver help build trust and confidence
in the capital markets and in economies the world
over. We develop outstanding leaders who team to
deliver on our promises to all of our stakeholders. In
so doing, we play a critical role in building a better
working world for our people, for our clients and for
our communities.
EY Romania
EY refers to the global organization of member

firms of EY Global Limited, each of which is a
separate legal entity. EY Global Limited, a UK
company limited by guarantee, does not provide
services to clients. For more information about our
organization, please visit www.ey.com
2014 EYGM Limited.

All Rights Reserved.
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Entrepreneurs Speak Out

Entrepreneurs Speak Out

Entrepreneurship Barometer Romania 2013

Entrepreneurs Speak Out

Entrepreneurs speak out - A call to action

The conclusions of the study must be seen as an

The Barometer represents the voice of 106 Romanian

of entrepreneurs consider access

of entrepreneurs think that regulatory

of entrepreneurs consider business

Entrepreneurship Barometer Romania 2013

Entrepreneurs Speak Out

About Entrepreneurs Speak Out

Provide a simple tool to measure the competitiveness

The opinions of entrepreneurs regarding the

Our barometer sums up the perceptions of 106 online

The entrepreneurial development framework: five pillars that foster entrepreneurship

Tax and regulation

Ease of starting a business

Education and training

Tolerance of risk and failure

Preference for self-employment

Entrepreneurship Barometer Romania 2013

Innovation and research culture

Entrepreneurs Speak Out

Why are the entrepreneurs important and how can they be

Across the EU as a whole, entrepreneurs supplied 67% of all

In Romania, according to OECD, SMEs contribute with 66% of

1 Ecorys, EU SMEs in 2012: at the crossroads. Annual report on small and

3 D Stangler and P Kedrosky, Neutralism and Entrepreneurship: The Structural

I am an innovator, I develop new products and services, I apply

I need help to access

I need a streamlined tax

I need a more supportive

I need a simplified fiscal

need taxes and regulation

I offer mentoring in order

I need support from

are mentoring in a formal

of them consider that SME credit schemes

say that failure in business

Source: Entrepreneurs Speak Out - Entrepreneurship Barometer Romania 2013

Entrepreneurship Barometer Romania 2013

Entrepreneurs Speak Out

The economic impact of SMEs

One of the main drivers of stimulating business creation is

The conclusion is clear: the countries that manage to improve

1 Organisation for Economic Co-operation and Development, Issues Paper

Moreover, those companies create twice as many jobs as

SMEs contribution to total number of employees in the private sector

More than 250 employees

Source: OECD, Entrepreneurship at a Glance 2013 - OECD 2013

Entrepreneurship Barometer Romania 2013

Entrepreneurs Speak Out

A call for action

In order to remove barriers, a common effort is needed not

A common effort is needed for the development of entrepreneurship:

In an environment with a high degree of uncertainty,

We see more and more young people

The challenges remain numerous, starting from difficulty in

Entrepreneurship Barometer Romania 2013

of the Romanian entrepreneurs consider

Conclusions on access to funding

Among the instruments that are considered to have the