Iain Bennett: We can’t expect to directly replicate a model from the US.

Probably you have noticed that after a very active month (February) on vaskeni.com March has been a little quiet. The truth is that I, and the Albanian Entrepreneurial Ecosystem, have been fully immersed in three weeks of workshops and meetings with international experts for Mentoring, Ecosystems, Accelerator Programs and Business Models brought to Albania by the Swisscontact SECO Entrepreneurship Programme as part of its mission to build a self-sustainable ecosystem.

The first week of March was kicked off with three Major Events for mentors and accelerators/incubators of our ecosystem. Mike DuckerJ.E. Austin expert for Ecosystems and Mentoring introduced the benefits of mentoring to mentors and accelerators. He also worked with the actors that want to build a mentor pool for their activities in another workshop and a series of individual meetings.

Also, Iain Bennett, an expert from the UK, was in Tirana during the same time. He focused on supporting accelerators/incubators and other actors to improve their business models and accelerator programs.

Impressed by his in-depth experience from the London Startup Ecosystem and his long professional career focused on Accelerators I asked him some questions to have a better understanding of the stage our young ecosystem is in and what we should do in order to make it grow faster and work better.

Iain, after two weeks and two workshops and lots of individual sessions with key startup ecosystem actors in Albania, how would you describe the state of the ecosystem?

The ecosystem is in an earlier stage of development than had been assumed by many of the actors!

Actors had assumed that there was an idea of a startup culture based on the Silicon Valley model. We now recognize there is a need to go back a step to scope what capability, capacity, expertise, and experience exists both in ICT and in awareness of enterprise as an opportunity for growth and jobs.

We can’t expect to directly replicate a model from the US and other developed economies. We need to understand better what can grow in Albanian soil.

What do you see as the key strengths and weaknesses of existing accelerators/incubators?


  • ​Some past commercial experience in some of the accelerator managers
  • A desire to make it work
  • Some great environments
  • (In most cases) willingness to work together


  • ​No track record
  • Hardly any direct experience of managing an accelerator or incubator environment
  • Overall lack of market awareness, particularly of high growth sectors and the barriers to entry to those market opportunities
  • Lack of sector experience in a number of cases
  • Inadequate horizon scanning of the prospects for: start up; ICT; the digital economy in Albania
  • Inadequate planning; in particular, lack of market research into demand for acceleration
  • No structured customer relationship management at any level (clients, multipliers such as Universities and employers in the sector, mentors, investors)
  • No defined programme for the businesses
  • Lack of data on the liquidity of the market: are there investors and purchasers in Albania/the region for the type of startups the accelerators are looking for? What kinds of valuations have other companies in the region achieved? Is there anything to support the idea that international investors already have, or may be attracted to establish, a presence in the Albanian market? Without this knowledge, the idea of seed capital is meaningless.
  • Lack of effective risk management strategies – very closely linked to the point above – how would the accelerators themselves or other investors be able with any certainty to know if their portfolio had any value? If there is no prospect of investment or M&A, what kind of multiples of turnover and profit would make an accelerator sustainable on the basis that it would continue to be a shareholder and receive dividends? Are there other risks associated with maintaining holdings over a longer period?
  • Poor marketing plans – indistinct value propositions + lack of research = likely failure

Where do you see opportunities for the accelerators/incubators in Albania?

If ICT is viewed as an enabler, and not an end in itself, the digital economy can drive the transformation of Albania’s service sector. Projects that target collaboration and research between digital startups and people and teams with domain-specific experience and expertise in administration, communications, distribution, logistics, manufacturing, retail, etc could work on a number of levels:

First of all, it could increase efficiency and productivity through tools and platforms offering to improve control, measurement, and management information of existing processes.

You may identify some companies that can disrupt inefficient ‘legacy’ providers and fine online substitutes or complements for existing vertical markets that are poorly served (eg Amazon and booksellers).

In some cases, finding solutions to the specific barriers that confront Albanian businesses looking to scale up may provide solutions for many other markets at a similar stage of development, or help identify solutions that may not be so pressing in other contexts. For example, the call center industry, whilst successful, is currently far down in the value chain of the industries it serves, and often foreign-owned, reducing its net impact on the Albanian economy as a whole. If intelligent agents can be designed that overcome challenges imposed by the large number of different ‘natural’ languages used by people in the region, this could not only offer a cheaper substitute in this market but also create commercial value that could be reinvested to use the natural language of call center operators more productively. The resulting solutions could also offer the export potential to other developing markets where the cost of providing customer service in a multitude of ‘natural’ languages is a brake on the growth of other service industries – eg Africa, particularly sub-Saharan Africa.

Based on your recent experiences with the accelerators/incubators in Albania, what are your predictions on the further development of the startup ecosystem in Albania?

I’m not in the business of making predictions. I am making a case for change. If the current actors don’t change there will not be any further development: without intervention and restructuring, there will continue to be insufficient demand for the product as currently configured.

What actions would you suggest to the actual actors to take in order to expand the actual small community in Albania into a much larger ‘startup’ community?

I pretty much answer this in my responses to (2) and (3) but to sum up:

​In order to properly scope and interpret the true scale of the opportunity, first think about how the transformation of the digital economy could disrupt and transform other sectors of the Albanian economy to result in much higher levels of productivity, growth, jobs, and entrepreneurship.

The outcomes are likely to occur in the order described above –  clear examples of how investment of knowledge, time, and money into new digital startups are needed to drive increased demand for accelerator/incubator support.

Encourage entrepreneurs to think about the transferability of anything you do: to adjacent territories, adjacent markets, or other territories or markets that share characteristics and barriers to those addressed by your product.

In the process, you will crystallize the opportunity to make Albania a ‘living lab’ for the design and testing of global solutions, taking advantage of what will hopefully be a short-term window in which you are a low-cost and low-wage economy.

Don’t limit your recruitment focus to undergraduates: successful entrepreneurs can be drawn from all parts of society, and need to if the economy is going to grow. Think about which of your current employees and interns can be mentored to try a startup. Get to kids in high schools before they are captured by the institutionalized thinking of their University lecturers. Participate in wider and more imaginative outreach in cities and towns outside Tirana.

Design programs that are attractive to a wider group of sponsors and clients – whether they offer solutions to specific problems in other industries, or speak to the CSR ambitions of (particularly) foreign direct investors in, or looking to enter, Albania.

Get some better data about the number and value of investments and M&A activity in early-stage companies in Albania in general, including those in ICT, and if possible the wider SE European region. Without it, you can’t with any authority establish the valuation of any of the companies in the ecosystem from time to time. There are very few institutional investors, and even fewer private investors prepared to act on that basis. No investors = no deals = no sustainability.

If there really is no existing evidence or culture of investment, and there is insufficient risk capital or public funding available to cover your operational losses the 5-10 years it may take to challenge the status quo, don’t be afraid to think the unthinkable – about how the sector might be bootstrapped in its entirety, or whether this is just not an activity that can take root in Albanian soil.

Initiate and publish research that demonstrates what Government could do that could really help build a tech sector – even if that is just to discourage it from investing in programs and facilities that duplicate existing activity and diminish the return on the private sector or donor investments.

Continue to think of yourself as one team and promote the entire package – you have a competitive advantage in your openness, your lovely surroundings, welcoming personality, great food, and a host of other benefits that have yet to be drawn to the attention of entrepreneurs and investors across the world. If there isn’t demand (yet) for startups in Albania, and the Government remains unresponsive or obstructive, could you bridge the gap with foreign private investment coming in to take advantage of Albania as a low cost, low wage but well-educated environment with great and widespread language skills, in particular English and Italian?

Keep in touch with me and with other international actors as part of your horizon scanning and market awareness – you’ll find people are glad to share their knowledge and contacts.

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In Albania, Tech Attempts to De-Balkanize the Balkans

On a balmy, spring evening in Tirana, around three dozen Albanian entrepreneurs are sat in a room of the same building where secretaries once committed communist government files to the software. The presentation they’re about to see might just be their best-ever chance at funding. The visitor: South Central Ventures, a recently-assembled fund that’s based in Belgrade, Skopje, and Zagreb. €40 million of public and private money is on offer for early-stage injections, managing partner Tatjana Zabasu tells the audience. It’s a chance to bring Balkan tech together.

Few in the room, part of the public/private Protik ICT Resource Center, are under any illusions: these are early – very early – days for the tech community in Albania. Indeed as more than one entrepreneur will tell me that evening, the whole crowd is barely three years old. But some success stories are beginning to appear in the small country. And, perhaps more excitingly, they could be a chance to cross borders that, for decades, were shut tighter than any others on Earth.

Albania is a small, kidney-shaped country at the foot of the Balkans, located in Southeastern Europe. It has a population of just under three million, and a GDP per capita barely prodding at $5,000, aligning it with similarly developing neighbors like Macedonia, Montenegro, Serbia, and Kosovo.

But while those countries became part of Yugoslavia in the aftermath of World War Two, Albania fell into deep isolation, at the behest of its Marxist-Leninist dictator Enver Hoxha. His regime banned religion, beards, and almost all foreign travel. So afraid of ‘revisionist’ outside influences was Hoxha, that he had 750,000 machine-gun pillboxes erected all around Albania. They are still to be seen today – beside roads, places of worship, and even public parks.

While people across the rest of the Balkans received traditionally high technical training under Yugoslav, or Soviet, rule, Albania remained an educational backwater. Early human rights successes, like gender equality and healthcare, were squandered from the 1960s on as Hoxha severed ties with all of his communist allies. By the time his Party of Labour fell, in 1992, Albania was Europe’s poorest nation.

Almost a quarter of a century on and the legacies of the isolationist rule are still evident, despite stabler politics in recent years. In fewer places is it felt more acutely as in SME development, which requires not only an injection of cash and tax breaks but a complete cultural shift.

“We have this way of learning where students are passive – there are no labs,” Vasken Spiru, a local ecosystem facilitator, tells me. “With coding, it’s like trying to write Java on a blackboard.”

“It comes out of a society where the majority of young people still wants to go and work for the state,” Jakob Modeér, a Swedish-born but longtime Balkan-based expert, tells me. “If you come from Britain or the U.S. it’s almost amusing. It’s clearly in the mind of people and their parents that state employment offers you stability.”

Modeér is Spiru’s colleague at swisscontact, whose SECO Entrepreneurship Program is trying to raise interest in startups and entrepreneurialism across the region. That we meet at a trendy café in The Block, a district of Tirana famed for its past as the hermetically-sealed neighborhood of Hoxha and his closest confidantes, is poignant. Today The Block is a vibrant, variegated humdrum of bars, restaurants and hotels. If The Block can change so quickly, Modeér asks, why can’t Albania?

“If you’re not a critical person, you don’t see problems. If you don’t see problems, that’s what a startup is all about,” he adds. “These are things that don’t come easily in such a hierarchical society. We need to break it down a bit. You do that with smaller groups – there’s no big bang.”

Neither is there a problem with space. Whole swathes of central Tirana, including some of its most famous communist-era buildings, lay eerily empty today. Even the Protik building, with its vast history and modern tenants, lays half-bare, its top floor empty aside from a blackboard, on which tech buzzwords are scrawled. “No,” Modeér says, frustrated, upon seeing what should soon be an accelerator. “We definitely don’t have a lack of space.”

Success stories are what Modeér, and Albania craves. Recently it got a few. 123.al is a discounts site founded by Laidi Ferruni, who recently launched Ireland-incorporated Quibli, an events marketplace. Shpi.al, a real estate portal, was founded by young entrepreneur Tomi Kallanxhi, with just $400.

Beyond Albania’s borders, in ethnic-Albanian Kosovo, Gjirafa (‘Giraffe’) recently became the first Albanian-language search engine. Altogether it has raised $2.5 million, including sums from Prague-based Rockaway Capital and serial investor Esther Dyson. Founder Megrim Cahani, who spent 12 years in in New York City, tells me that finding a viable model was a conundrum.

“It was very difficult because there are two really big problems in the region – first is the region in terms of macroeconomic indicators – GDP overall is very low compared to developed markets,” he says. “Then there’s the population. It’s a very small market with tiny purchasing power. Plus the economy of Internet is not very developed.”

Web penetration in both countries is pretty good, however, with Kosovo at 88% and Albania around 75%. “We recognize that the market is small,” adds Cahani. “It’s small if you want to grow the product horizontally. But if you’re doing a few basically and you grow vertically, the market is big enough. We want to be the leader in news, advertising and e-commerce. We don’t have to be top-of-the-line Amazon to cut it.”

In total there are 12 million Albanian speakers in the Balkans and diaspora populations in North America and western Europe – not including millions of undocumented speakers in Turkey. Gjirafa recently hired ten more staff to add to its team of 22. An upcoming office in Tirana will accommodate ten more, with plans to move into Skopje, Macedonia’s capital, Slovenia and Prague. “Gjirafa can give Albanians services that are so basic elsewhere but not here. A lot of ten-year-old services still aren’t here yet.”

At the presentation in Tirana, Zabasu has turned her focus on the audience: what are the advantages of the Albanian scene, she asks. Developers’ wages can run very low, Ferruni says: “An average one could be just €200-300. Advertising is really, really cheap here too, so it’s easy to get to market and gain customers very fast.

“Even in Macedonia, which is right next to us, the cost-per-click can go up to a dollar,” he adds. “But here the average is just $0.02-03. So it’s really easy to gain traction.” Facebook penetration is also high in Albania, another person adds, at 1.3 million users. It’s a good platform for change.

The aforementioned lack of technically-skilled personnel is a problem, Modeér admits. But that drawback might actually be a chance to do things better, cooperatively: “If you’re set on the global market you will need resources. So here, you have to ask: which countries have coders and programmers? Some have more coders than marketers. Albania is very strong on marketing but it has no coders. We should think as a region.”

And that, it seems, is precisely what many in the local ecosystem are doing. SCV is looking at investing in Croatia, Bosnia, Serbia, Kosovo, Montenegro, Macedonia and Albania. And EU money from Bulgaria and Slovenia is beginning to sniff out talent in the region, too. Tirana itself boast several startup resources committed to looking beyond the country’s borders, such as Startup Grind; Oficina; GARAZH (‘Garage’); Talent Garden and Protik.

Balkan adroitness in second languages could provide another key opportunity for collaboration. Most Albanians speak excellent Italian (from Durrës it takes a night-ferry to get to Bari), while Kosovars, thanks to old family links, tend to speak good German. Other areas promote English, Russian and more.

“I think collaboration is key between Albania and the other nations in the region as we grow as a cluster together,” Erkens Gjini, Oficina’s Business Development Manager, tells me. “If we can identify our advantages and symbiotically use them, then we can challenge other nations and become a global factor.”

Neither Gjini nor any of the entrepreneurs I spoke to voiced concerns about dealing with Serbians, Macedonians, or any of the region’s other nationalities, whose dividing conflicts and enmities have coined the very term ‘Balkanism’ to mean the cleaving of deep ethnic, religious and political lines. Tempers often flare on a governmental level even now. But, adds Gjini, which is not replicated in the boardroom: “I have been to Serbia and have many friends who share the same idea. All this political propaganda is used to secure those votes from the ultra-nationalist, which do not represent the voice of the nation.”

After the event, I speak to Bashkim Sykja, Albanian director of entrepreneurship policy at the Ministry of Economy. He stresses Tirana’s encouragement of entrepreneurialism, and its opportunity to bridge old divides. “ICT helps the Balkans in terms of connectivity among the countries,” he says. “If we want local companies to become competitive in this global market, we must make sure ICT is considered one of the key sectors.”

That will help enthuse state institutions and banks to invest in startups, something Spiru admits is sorely lacking right now. “It’s a chicken-and-egg situation,” he says ruefully. “Why should the government invest when there are only a few startups here?” More money would spur investment in online payments, he adds, which would inspire a wave of e-commerce firms to set up shop – usually the first line in ecosystem development.

Working across borders will, above all, adjust local entrepreneurs to the global market and its requirements adds Modeér. He tells me about an accelerator that brought Kosovars from Skopje to Serbia without a hitch, before adding, “We can bring the Balkans together but through the startup community. The real mindset change will come when you start working for a German customer. Not your cousin down the street, who will make concessions on timescales and quality. A German will never do that. Quality, price, delivery time. Reality.”

Despite what they might tell you, the people of the Balkans share a huge amount of their customs and culture. Many national dishes, for example, share an Ottoman heritage, while similar adherences to Sunni Islam and Orthodox Christianity have swept up from empires from the south, west, and east for centuries.

There are legends, too, which have crossed borders. Take that of Muji and Halili, highlanders who, having drunk the milk of a fairy, challenged each other to lift and hurl boulders three miles away. A modern, post-communist Balkans may have endured a litany of wars, genocides, and political repressions. But finally, it appears a new regional generation is ready to band together, pick up the rock of industry together and hurl it as a globalized market.

“Everybody here has their competitive advantage,” Modeér adds. “This is grassroots, so it will win. It has to be from the bottom up, not from the top down. The only stability you will find is in the private sector.”

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