2022 | StartupBlink View the Global Startup Map p. 184 Startup Ecosystem Overview Croatia boasts one of the most promising startup scenes in the Balkans. The center of startup activity in Croatia, the capital of Zagreb, is developing into a regional startup hub. There is a strong support network in the city with many startup events and conferences, and the country's EU membership facilitates expansion into other European markets. In recent years, Croatia has shown its remarkable potential after joining the unicorn club with Infobip. Some of the main challenges that the Croatian ecosystems face are related to startup risk aversion, low government investment in R&D, unfriendly business regulations, and difficulty accessing funding for startups to scale. There is too much focus on grants rather than investment. Government support helps, but also creates a closed system that should prioritize opening to the EU and global market. Croatia has a skilled talent pool, but there has been an increasing trend of young people leaving the country and/ or registering their companies outside of Croatia. Most young Croatian IT companies choose agency work over creating their own tech company through innovative products and services. This is also connected to a lack of early stage investors, particularly pre-seed and seed stage VCs, which will allow Croatian startups to grow and scale. Furthermore, Croatia lacks a serious government strategy to develop the national startup economy. In R&D, government support programs favor large companies, while links between universities and industry are limited. Although Croatia has made near term progress by cutting red tape, there is still work to be done in digitizing the whole process, as well as in the reform of tax and regulatory mechanisms that pose various barriers and pitfalls for young companies and startups in particular. Croatia is actively working on these challenges. An investment platform of over US$ 40 million will be launched by the end of 2022 to support innovation, scientific research, and the protection of intellectual property in Slovenia and Croatia. Another notable milestone is the creation of the national Croatian startup association CRO STARTUP, which focuses on core challenges in Croatian startup ecosystems, such as regulatory barriers. There are some prominent accelerators and incubators in Croatia, such as ZICER, the Bird incubator (founded in early 2021 with the aim of helping startups with software ideas related to data analytics, artificial intelligence, and machine learning), Poduzetnički inkubator BIOS, and the Science and Technology Park Step Ri. Infobip also launched the Infobip Startup Tribe in 2021. This new global startup program seeks out innovative and impactful startups and assists them with growth tools, credit allowances, and network support. There are many startup events and conferences, and numbers are increasing annually. Startups can find support, funding, and exposure with events such as Zagreb Connect, Idea Knockout, Shift, Get in the Ring Split, and GROWit.