Home of two tech unicorns, tiny Croatia is becoming a leading hotbed for IT

Great ideas can emerge from the most unlikely locations. With a population of just over 6,000, Vodnjan is a small town in the scenic seaside region of Istra, Croatia. With winding cobblestone streets and sun-washed stone buildings, the unassuming town isn’t the first place you’d associate with fast-growing startups — but it’s the birthplace of Infobip, Croatia’s first technology unicorn.

Established in 2006, Infobip offers a variety of cloud communications services to telecoms providers all over the world. Led by co-founders Silvio Kutic, Roberto Kutic and Izabel Jelenic, the company has around 3,500 employees in more than 70 offices worldwide.

Despite its impressive global reach, Infobip’s main offices remain in tiny Vodnjan, where Kutic’s family has lived for more than 500 years.

The concept that led to Infobip emerged in 2001. The initial idea was to create something that would serve as a virtual community for Vodnjan’s residents, and a platform to allow local authorities to communicate with citizens. “It was something like a CMS system, a virtual space where residents could subscribe to and get their info through the website, mail, SMS, and so on,” Kutic tells ZDNet.

Five years later, Kutic took these initial ideas forward and founded Infobip with an initial investment of €25,000, which he borrowed from his parents. Today, Infobip is worth more than €1bn, specializing in customer engagement technology and omnichannel communication. The company recently acquired global VoIP provider Peerless Network, outlining its international growth strategy and ambition to expand into the US market.

The rise of Infobip serves as testimony to how far the IT industry in Croatia has come over the years, and has helped put the small Balkan country — renowned for its sunny beaches, music festivals and starring role in hit HBO series, Game of Thrones — on the global IT map.

Currently, one-third of Infobip’s employees are based in Croatia. The company achieved ‘unicorn’ status in 2020; now, Kutic says he’s looking forward to “an era of exponential growth” throughout the Balkans. “For people, this is very important — to be a part of this story, to know that they created something successful,” he adds.

While generally not associated with the likes of London, Berlin and other European tech hubs, Croatia is home to a vast IT talent pool that is just starting to develop, especially when it comes to software engineering.

Software development company Infinum is regarded as another Croatian tech success story. The 350-strong team of developers and specialists serves globally recognized brands like Samsung, Universal, Coca-Cola, Bayer & Bayer and T-Mobile. Infinum recently expanded to neighboring Montenegro, where it plans to invest more than €3m over the next two years.

While Infobip might be considered the first Croatian unicorn, it is not the only one. Take Electric vehicle (EV) manufacturer Rimac Automobili, which currently employs about 1,000 employees. The company hopes to increase this number to 2,500 by 2023, while ramping up investments in research and development.

Such developments are a boon for tech professionals in Croatia. With companies like Infobip and Rimac Automobili creating new job opportunities for a burgeoning tech industry, the country hopes to recoup the “brain drain” it has suffered over the years as skilled workers move to other Western countries for employment.

Vedran Kontosic has been working as a developer from Infobip’s Vodjan headquarters for the past eight years. He says Croatia’s tech landscape is almost unrecognizable to how it was a few decades ago, when opportunities for anyone working in IT were scarce, computers were expensive, and developers had to decipher training manuals written in unfamiliar languages.

“When I was starting in the 90s, not everyone could afford a computer, internet, and we had to study from textbooks in other languages, such as Italian for example. Now, the conditions are much better for younger generations,” Kontosic tells ZDNet.

Kontosic believes Croatia’s tech ecosystem is increasingly being boosted by growing interest in tech and IT among young Croatians, combined with the tech companies that are uplifting the economy by creating new, skilled jobs for the local population.

Infobip is also investing in Croatia’s startup ecosystem, particularly projects involving artificial intelligence, robotics and FinTech.

STEMI, for example, is an educational robotics startup that aims to get kids interested in technology while teaching them basic engineering and programming skills. Kutic hopes such initiatives can bridge the gap between schooling and the skills needed for tomorrow’s workforce, allowing young Croatians to get hands-on experience that can be applied in the real world. “They engage in projects and quickly learn, adapt, and enter the global IT industry,” he says.

Infobip wants to expand these educational efforts outside of Croatia, too.

In May 2021, the company launched its Startup Tribe programme, which aims to fast-track the development of regional startups by offering them office space, connections to venture capital firms and accelerators, and access to Infobip’s products and services.

The programme has already onboarded more than 70 startups from nearly 40 countries, many of them coming from Croatia and the Balkans. “We try to support startups globally, and as a person that ran his own startup, I know what a hard and daunting task that can be,” says Ivan Burazin, Infobip’s chief development experience officer.

With this programme, the company is investing in new generations of startups that will — ideally — give back to the tech ecosystem once they mature.

That approach involves playing the long game, but for Kutic, investing in the developing tech ecosystem is crucial to helping Croatia — and the wider Balkan region — attract the attention it needs to flourish further.

“The rest, such as investments, growth, and VC funds, will surely arrive as well,” he says.

Originally published at https://www.zdnet.com on January 19, 2022.

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Bojan Stojkovski

Bojan Stojkovski

Freelance journalist based in Skopje, Macedonia. Contributor for @ZDNet and @ForeignPolicy