The project wants to develop a breeding ground for private investors who will provide small financing to small hi-tech companies. Georgescu says the plan is to persuade people with resources to invest in IT rather than keep their money in the bank.
The project, which is managed by Bogdan Iordache, a young entrepreneur who has in the past few years organized the conference dedicated to startups “How to Web,” has as co-founders Radu Georgescu and Andrei Pitis, the current head of the National Association of the Software and Services industry (ANIS), who also teaches at the Polytechnics University and is an investor in several startups.
The project’s objective is to develop the Romanian IT industry of product creation by stimulating businesses that need financing between a few thousand euros and EUR200,000.
“We have found that although money is plentiful on the market, there is a gap for amounts between EUR10,000 and EUR200,000, which nobody wants to invest. If an entrepreneur who needs up to EUR10,000 is likely to use their own resources, while for amounts in excess of EUR200,000 one can get the money from investment funds, only ‘business angels’ are willing to invest the amounts in between,” Radu Georgescu says. He adds that in Romania the culture of personal investments has not developed yet, although there are people who might have EUR10,000 available for investments, but are not willing to take risks and prefer to keep their money in the bank.
At present the Techangels.ro club has almost 20 members, who include Lucian Todea, CEO of ITNT, Laurent Asscher, CEO of Airteck Capital Group, Razvan Capatina, managing partner of Business Results and Sergiu Negut, partner with HR Wanted Transformation Consultancy, who was previously deputy manager of private medical services operator Regina Maria.
“Within 2-3 years we want to have tens of financeable startups and for the club to have at least 100 business angels. Apart from financing, these investors are meant to help entrepreneurs with their expertise in the sector and with the professional relationships they have developed in time,” Bogdan Iordache says.
He adds that in the short run the platform will not be profitable and that the first objective is to find business angels willing to finance small tech businesses. Subsequently the project will be made profitable, either by retaining a percentage of the new investments or through an annual tax for joining the club.
According to Radu Georgescu, a “financeable” startup has three components that ensure its success: the project’s idea, its technical execution and its business execution.
“We want to build an ecosystem of private investors who will invest small amounts in the Romanian IT industry (…) and help it grow,” Georgescu also says.
The strongest startup teams are made up of people with a technical background, aged between 25 and 35, who have professional experience in the field and have had at least 1 or 2 attempts at startups.
“Our intention is to finance firms that create products not necessarily for the local market, but for the international one. Business angels are minority investors, they have to finance a business run by a strong enough entrepreneur to whom they will provide the resources for growing the business,” said Andrei Pitis of ANIS.
(English version by Daniela Stoican)