Romanian incubator launch

NEST, a Romanian incubator, has been launched in conjunction with initial funding from the Romanian Post-Privatization fund. The new company was launched as part of a larger concept, the Advantage Software Factory, a business model combining a software division with the NEST incubation unit. The fund has a total of S1.5 million and plans to invest in a total of six projects. Each commitment will be for the value of approximately US$250,000 and it is hoped the investments will be realised within six to nine months. The first round of decision making will take place next month with a view to incubating the first two projects in April.

The software division of the Advantage Software Factory is a profit centre in itself that develops customised IT and Internet applications such as e-commerce and e-marketing; web design; Intranet and extranet; streaming media applications; multimedia animations; client server applications; web server applications; Internet payment gateways and e-cards. The software division will also provide the software elements necessary for the development of incubated projects.

Raluca Popescu, investment officer with the Romanian Post-Privatization fund said of the project: “In order to adapt to an emerging market like Romania we built a business model that benefits from the synergy of two activities: software development and incubation, therefore counterbalancing the risk of the incubator with a cash-generating unit like the software factory. Actually, we can consider this model as the competitive advantage of NEST, besides having access to a wide-spread pool of strategic partners.”

Committed investors in the Advantage Software Factory, including both NEST and the Software Factory are the Romanian Post-Privatization fund, a S44 million venture fund with investors EBRD, EU and GED Eastern fund; A-Anacom, a German incubator and venture fund; Advantage Software Corporation, a software company; Roland Berger & Partner, a leading European management consultant; and Hill International, a recruitment firm. NEST is also said to be in advanced discussions with other prospective investors such as Omega Partners, Israeli investment bank, owner of Technion Incubator, Hewlett Packard or IBM, Tecnologieholding and Bavarian venture fund, recently bought by 3i.