The Study Entrepreneurs Speak out - Romanian Entrepreneurship Barometer, Now in Its Third Edition

Date: 06/09/2015
Source: EY
  • 55% of Romanian entrepreneurs believe that within 10 years, Romania will provide a business-friendly environment
  • 62% of entrepreneurs believe that entrepreneurial education has improved in Romania in the last year, compared to 58% in the 2014 edition of the study
  • Access to funding is difficult or very difficult for 82% of entrepreneurs
  • 50% of respondents say that fiscal issues are the greatest obstacle in developing a business in Romania
  • 65% of entrepreneurs believe that business failure is shun by society
34% of Romanian entrepreneurs who answered the EY Entrepreneurs Speak Out – The Romanian Entrepreneurship Barometer 2015 survey expect Romania to provide a friendly environment for business development in a medium-term (5-10 years), while 21%It expects this to happen in a shorter time (3-5 years).
If 55% of entrepreneurs indicate a time span of up to 10 years, 19% of entrepreneurs are much more pessimistic. The latter consider that Romania needs at least 30 years to become a pro-business environment.

The study Entrepreneurs speak out - Romanian Entrepreneurship Barometer, now in its third edition, is an annual barometer conducted by EY Romania, which measures perceptions of Romanian entrepreneurs on five pillars essential for the development of entrepreneurship: access to funding, regulation and taxation, entrepreneurial culture, education and coordinated support provided by associations specialized in supporting entrepreneurship. For this edition 369 entrepreneurs and businessmen from Romania answered the survey, between 9 January - 24 February 2015.

Fiscal issues - the most important obstacle for entrepreneurs
Almost 50% of respondents indicate fiscal issues, such as regulatory unpredictability, taxation complexity and level of taxes as the biggest obstacle in creating and developing a business in Romania.
Also, the analysis of the words used by entrepreneurs to indicate the most important obstacles to business development, shows that deficiency marks their activity, be it lack of fiscal predictability, skilled human resources, local and central administrations’ support to entrepreneurs, lack of business incubators or financial resources.

Education and entrepreneurship - the only pillar with a major positive development
Like the previous edition of the study, of the five pillars that support the development of entrepreneurship, entrepreneurial education and training is the only factor for most entrepreneurs perceived as having a positive evolution: 62% of entrepreneurs believe that this factor has improved in Romania in the last year compared to 58% in the 2014 edition.
On the other hand, 42% of respondents indicated an improvement of entrepreneurial culture. 37% believe that the assistance provided by organizations specializing in the development of entrepreneurship has experienced a positive development and 30% that access to funding has improved. Only 20% of respondents believe that regulation and taxation have experienced a positive development in 2014.

Top 5 government measures that impact entrepreneurship

In the view of Romanian entrepreneurs, the top 5 government measures that would support Romanian business short-term development are: reducing the tax burden and providing fiscal incentives (45%), reducing bureaucracy and simplifying legislation, especially the Tax Code (15%), providing State guarantees for loans, especially for start-ups (8%), improve collaboration and communication between the public and private environment (7%) and stability of the fiscal environment (5%).

Access to finance - still a major problem
82% of respondents considered access to finance difficult or very difficult, down 6 percentage points from the previous edition of the survey. Top 3 funding instruments with impact for entrepreneurial companies are bank loans, EU funds and microfinance.
Regarding areas of government action, Romanian entrepreneurs consider the following as the most suitable measures to improve access to funding for business:
• Fiscal incentives for investments in small companies (26%)
• Provide loan guarantees (20%)
• Reduced taxation of capital gains (18%)

Business failure is shun

Fear of failure remains one of the significant barriers to approaching entrepreneurship. A percentage of 65% of entrepreneurs believe that business failure is shun by the Romanian society, being perceived as a barrier for future business projects (37%), a failure in career (17%) or indicate the lack of skills needed to be an entrepreneur (11%). Only for 29% of entrepreneurs business failure is a learning opportunity.

Entrepreneurship programs in universities

Specific programs for entrepreneurial education (56% of responses) are the most representative for Romanian entrepreneurs in improving the perception of entrepreneurship as a career choice among young people. In second place, with 22% in options and showing increase over last year, ranged government programs that support entrepreneurship.

At the same time, entrepreneurs provide mentoring to those at the start of their career: 68% offer mentoring to start-up entrepreneurs in an organized or informal framework.

Business incubators and accelerators will play the most important role in the development of entrepreneurship
Among the forms of coordinated support offered by associations and specialized institutions, entrepreneurs consider business incubators and accelerators as having the most important long-term role in the development of entrepreneurship, followed by government programs for start-ups. In Romania, these programs are coordinated by the Entrepreneurial Policies and Programs Implementation for SMEs Directive within the Ministry of Energy, SMEs and Business Environment.

"Entrepreneurship is one of the major forces that are changing the world as we know it, manifesting itself increasingly stronger in countries with entrepreneurial tradition, but also in emerging countries. Entrepreneurship is changing in itself too, more and more young people establishing their own company. Almost 50% of global entrepreneurs are between 25-44 years. Also, young people between 25-34 are the most entrepreneurial group. The challenge for Romanian entrepreneurs, also young ones, is to keep pace with these rapid developments taking place worldwide. The same challenge is equally met by public institutions. Regulatory issues (taxation complexity, bureaucracy, lack of fiscal predictability) are the most pressing issues for Romanian SMEs, in comparison to increase of customer base, which is the most important issue for SMEs in the European Union," said Bogdan Ion , Country Managing Partner, EY Romania.

"We proposed that through the annual achievement of this study to contribute to a better understanding of the environment in which Romanian companies originate and develop: what is successful or taking on a good course and what does not work so well for entrepreneurs. Thus, we hope to help business people be more informed, while other stakeholders (public institutions, business incubators and accelerators, funders, educators, etc.) receive an overview of the Romanian business environment, which would assist them in determining future actions aimed at supporting entrepreneurs," said Alexandru Lupea, Partner and Strategic Growth Markets Assurance Leader, EY Romania.
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About the study Entrepreneurs Speak Out: The Romanian Entrepreneurship Barometer 2015
EY Romania’s study assessing the perception of Romanian entrepreneurs on the local business environment is based on an online survey examining the perceptions of 369 Romanian entrepreneurs, analysis of quantitative economic and social indicators, findings from round tables held with entrepreneurs and analysis of more than 100 best practices and government initiatives on G20 countries and Romania. Of the respondents included in the survey, 49% own businesses under EUR 1 million, 31% businesses between EUR 1-5 million, 10% between EUR 5-15 million and 10% revenues exceeding EUR 15 million. Most respondents came from Bucharest (39%), Cluj (8%), Brasov (7%) and Timis (7%).

The full study (in Romanian), can be found here.

About EY Romania
EY is one of the world's leading professional services firms with approximately 190,000 employees in 700 offices across 150 countries, and revenues of approximately $27.4 billion in the fiscal year that ended on 30 June 2014. Our network is the most integrated at global level and its vast resources allow us to help our clients benefit from every opportunity. In Romania, EY has been a leader on the professional services market since its set up in 1992. Our over 500 employees in Romania and Moldova provide seamless assurance, tax, transactions, and advisory services to clients ranging from multinationals to local companies. Our offices are based in Bucharest, Cluj-Napoca, Timisoara, Iasi and Chisinau. In 2014, EY Romania has affiliated to the only global competition dedicated to entrepreneurship, EY Entrepreneur Of The Year. The winner of the local edition represents Romania in the international finale that takes place every year in June in Monte Carlo. The World Entrepreneur Of The Year title is awarded at the international finale. For more information, please visit
Romanian Entrepreneurship Barometer 2015

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