If you’ve been following Hungarian news, not much of it has been good. But let’s not get into that. When the news is bad, you can also make headlines with a contrarian story.
This week the New York Times profiled three local startups that are defying Hungary’s dire economic climate.
The story is familiar to those of us who have been following the Hungarian tech scene. What’s news is that a handful of new companies are finally gaining traction. And Hungary’s startup scene is becoming increasingly interconnected:
“The ecosystem in Hungary is improving; young entrepreneurs and big investors stimulate each other,” Mr. Szabics [portfolio.hu] said. “There are a number of mentoring programs to convince young people that it’s worth it.”
(This is a trend I’ve also observed, and is worth a separate post.)
Keep in mind that none of these three startups is exactly new. The oldest is LogMeIn, founded in 2003. Could you even call this company a startup at this point?
Note also that each of these three companies has significant foreign participation (founders, executives, capital). Each of these companies makes the majority of their revenues outside of Hungary. And it’s a sure bet that the rest of the world had no idea these companies were founded in Hungary. (Until now.)
When I was at IndexTools (now Yahoo Web Analytics), we made no effort to tell people we were Hungarian. Quite the opposite. We preferred they didn’t know.
The New York Times doesn’t see much advantage in Hungary, either:
Some investors and entrepreneurs shrug off the country’s economic and political situation. Still, with government bonds rated junk, a large budget deficit, and the country’s combative prime minister, Viktor Orban, battling Brussels over his economic policies, negative growth is forecast for this year and the forint, the local currency, has been very volatile.
So the question is do these three companies represent a trend? Or are they exceptions to the rule?