Entrepreneurship in Bosnia & Herzegovina
Background & History
Bosnia and Herzegovina also known as Bosnia or BiH, is a coastal country located in the South and Southeast region of Europe called The Balkans. Bordered by Serbia to the East, Croatia to the North and West, Montenegro to the Southeast, and a narrow coastline of 20 kilometres with the Adriatic Sea in the South. Sarajevo is the capital and largest city in Bosnia. The name comes from the two regions Bosnia being the northern part and Herzegovina being the southern part of the country.
Bosnia was part of the Republic of Yugoslavia post World War 2 and got its independence in 1992 with the breakup of Yugoslavia. The country has a population of approximately 3.8 million and is home to three main ethic groups – the Bosniaks, the Serbs and the Croats.
Bosnia is a developing country ranking 73rd in the Human Development Index. The economy is dominated by industry, agriculture, tourism and the services sector. During the 1970’s and 1980’s the then Yugoslavia had a strong industrial export-oriented economy, agriculture also contributed to the exports. Tourism growth rate has been the third highest in the world between 1995 and 2020. But the war in 1990’s disrupted the economy due to the damage to the physical infrastructure. The GDP fell by 60% and since independence Bosnia has struggled to bring the economy back in shape.
Entrepreneurship and Startups
As per the world bank doing business report 2020, Bosnia and Herzegovina is ranked at 90 in the ease of doing business ranking. Entrepreneurial ecosystems and startup communities are mainly emerging in the cities of Sarajevo, Banja Luka and Mostar. International organisations are playing a key role in developing entrepreneurship in the country. International programs such as the EU-funded EU4Business project supports entrepreneurs with their startups in terms of formal business training and financial support to upgrade machinery or technology. The European Bank for Reconstruction and Development (EBRD) focuses on restructuring and expansion of the private sector in Bosnia and Herzegovina. USAID’s Marginalised Populations Support Program in collaboration with local municipalities helps women on at the bottom of the pyramid to start and expand their own businesses in Bosnia and Herzegovina. More than 200 women have received support from the USAID program. The Swiss Development Cooperation (SDC) funds a Youth Employment Project through which it has been able to incubate business ideas through out the country.
In terms of demographics, females are more in ratio to males in Bosnia and Herzegovina, and that trend is also visible in the field of entrepreneurship in the country. Females are founding companies or are in key leadership positions in companies. Tech sector is a booming sector for entrepreneurs, Bizbook a Business networking platform, Loop d.o.o is a electronic billing and payments system, Koola an AI driven platform that connects dealers and OEM’s with the customers to ensure proper maintenance of their vehicles are some of the well known tech startups in the country.
A major challenge to entrepreneurs and developing entrepreneurship in the country are access to private funding, internationalisation and scaling their business, which point out to the obvious opportunities in solving these problems by starting venture funds or private equity firms that can fund entrepreneurs, incubators and accelerators that can train and help entrepreneurs to network and connect with prospective markets for expansion.