BR/06/2022

POSITIVE OUTLOOK FOR REAL ESTATE MARKET IN 2022

June, 2022 / Volume 26, Issue 5

www.business-review.eu

6

SUSTAINABLE CITIES PAVING THE WAY TO A SMART(ER) FUTURE

12

AUDIO ARCHITECTURE CHANGING SPACES AND LIVES

28

THE ROAD TO RECOVERY STARTS WITH A NEW MINDSET

32

HAGAG DEVELOPMENT EUROPE: THE PHILOSOPHY OF PERFECTION IN BUSINESS

www.business-review.eu Business Review | June 2022

EDITORIAL 3

• Editorial •

REAL ESTATE

Anda Sebesi • Editor-in-Chief •

6 Positive outlook for real estate market in 2022

COVER STORY

Confidence paves the way to success

M

ajor international issues related to the Ukraine crisis,

8 A business based on the philosophy of perfection

MAIN STORY

high inflation, growing interest rates, and a slowdown of leading economies are all rattling the startup funding

market, meaning that entrepreneurs might have a harder time securing the necessary funds in the coming year. Faster routes to profitability are set to become a hot topic among startup found-

12 Sustainable cities paving the way to a smart(er) future

ers and investors as sky-high valuations begin to lose steam. But what Silvia Floares, co-founder at Mezanin Market, Roditor Food Market, and Weekend Sessions, pointed out at the 5th edition of

ENTREPRENEURSHIP

Business Review’s Rising Cities. Smart Future event was that uncertainty, insecurity, and financial fluctuations are very common issues faced by Romanian companies and local independent cultural operators. Regardless of the difficulties they may face, they continue to have a positive sentiment regarding their businesses.

There are many sectors in Romania that are currently transforming challenges into business opportunities and generating growth. Real estate is one such sector, and this is why we’ve

20 Startup valuations and investments see rebalancing amid economic turmoil

CITY

decided to dedicate the cover story of this issue to a business based on the philosophy of perfection: real estate investor and developer Hagag Development Europe. Since its entry on the local market back in 2017, it has been working to reshape the local urban landscape. The company’s business vision is based on the philosophy of perfection, and it pays little attention to passing trends. Hagag’s strategy is built around timeless properties that transcend trends and create excellent value that doesn’t sway away. And this seems to be a winning approach for both the company and the local communities it transforms through its projects.

35 Ioana Ciocan: “New generations of art collectors are emerging in Romania”

37 Romania’s presence at Venice Biennale

38 Cultural calendar

EDITOR-IN-CHIEF: Anda Sebesi JOURNALISTS: Aurel Constantin, Mihai Cristea, Deniza Cristian, Romanita Oprea, Oana Vasiliu CONTRIBUTORS: Ovidiu Posirca, Claudiu Vrinceanu COPY EDITOR: Anca Alexe PHOTO EDITOR: Mihai Constantineanu PHOTOS: Dreamstime ART DIRECTOR: Raluca Dumitru PUBLISHER: Bloc-Notes Media Network ADDRESS: 82-98 Calea Grivitei, 1st floor, Hotspot Workhub, District 1, Bucharest, Romania SALES MANAGERS: Radu Fireteanu, Alexandra Rosca MARKETING & SALES MANAGER: Luiza Luca PRODUCTION: Dan Mitroi DISTRI­­BUTION: Eugen Musat EXECUTIVE DIRECTOR: George Moise GENERAL MANAGER: Catalin Alistari USA MANAGER: Oana Molodoi FOUNDING EDITOR: Bill Avery EMAILS: editorial@business-review.eu, sales@business-review.eu, events@business-review.eu SUBSCRIPTIONS on Manpres Distribution Business Review is a member of Fwei

Publicație auditată pe perioada Apr 2015 - Mar 2016

ISSN NO. 1453-729X

www.business-review.eu Business Review | June 2022

4 NEWS

WHO’S NEWS BR welcomes information for Who’s News.

Submissions may be edited fo­­­r length and clarity.

Get in touch at mihai.cristea@business-review.eu

More than half of Romanians prefer digital payments

By Deniza Cristian device. When asked a similar question about their last online purchase, only 14 percent of respondents said they had paid cash on delivery. “Visa supports the payment ecosystem

Angeliki Karava has been appointed by SofMedica Group as General Manager for the ISLE Academy across all locations where the organisation has an established presence: Romania, Greece, Hungary, Bulgaria, and Cyprus. Karava is a microbiologist with extensive experience in the healthcare sector at the global level, having started out as a supervisor in research and diagnostics laboratories, then moved on to senior commercial positions in multinational medical devices & pharmaceutical companies.

in the CEE region, including Romania, which results in the number of terminals accepting card payments increasing and consumer daily payment

51 percent of Romanian consumers tend to use a card for payment

page 5

payment products and solutions are introduced on the Ro-

Results of the latest interna-

use a card for payment. The top

manian market in partnership

tional study “Attitudes towards

reason for choosing cash is when

with our partner banks, acquir-

payment methods,” commis-

digital payments are unavailable

ers, and other financial institu-

sioned by eService and other

at a given store or service point—

tions,” said Elena Ungureanu,

EVO Group entities, show that

that’s the view of one third of

Country Manager at Visa in

almost 6 out of 10 Romanians

the respondents who often pay

Romania. The study also finds

like to pay digitally citing ease

with cash. It is worth noting that

that stores that offer digital

of use and convenience. Visa

digital payments dominate as

payment methods are clearly

was a partner of the study in

the preferred payment method

perceived in a positive way by

the Central Eastern European

for online shopping among

Romanian consumers: as many

region.

Romanians. Half of the respon-

as 77 percent of respondents

dents paid for their last in-store

believe they are modern and 72

while shopping, 51 percent of

purchase with a card or using a

percent of them think they are

Romanian consumers tend to

phone, smartwatch or another

customer-centric.

The study shows that

Adam Nykles has been named Chief Data Officer for Publicis Le Pont. The appointment is an expansion of Adam’s existing remit as Chief Data Officer of KINDRED, a part of Publicis Groupe Czech Republic. Adam has 12 years of experience in the digital marketing industry from various fields of media, programmatic, AdTech and MarTech platforms, data, and digital transformation. Over the past three years, Adam has been leading the Groupe’s Data and Technology Practice Center of Excellence out of Prague.

experience improving as new

Alpha Bank Romania supports Romania’s entrepreneurial environment

By Deniza Cristian Alpha Bank Romania has joined

support construction—includ-

four new governmental pro-

ing green projects—, stimulate

grammes whose main priorities

productivity and competitive-

are to boost local production,

ness in the agricultural field, and

Alpha Bank grants financing for entrepreneurs through new programmes

www.business-review.eu Business Review | June 2022

NEWS 5

EBRD becomes first international financial institution to open office in Cluj-Napoca

By Aurel Constantin Martin Sander is the new General Manager of Ford Model e and Chair of Ford-Werke GmbH. He will lead the delivery of breakthrough electric vehicles, as well as the development of software and connected vehicle technologies and services. Sander will be located in Cologne, the headquarters of Ford’s European Model e business unit.

The European Bank for Reconstruction and Development (EBRD) is expanding its presence in Romania by opening a new office in Cluj-Napoca, the country’s second-largest city.

The EBRD is the first international financial institution to open a regional office there, recognising the significant potential of its location.

Situated in the heart of

The Cluj-Napoca office will support local SMEs with expert advice, training, and access to finance

historical Transylvania, ClujNapoca is a gateway to three

EBRD’s Advice for Small Busi-

businesses in Transylvania,”

strategic regions of Romania:

nesses (ASB) programme, funded

says Charlotte Ruhe, EBRD

the north-west (where it is

in Romania by the European

Managing Director for Central

located), the centre, and the

Union and the EBRD’s Small

and South Eastern Europe.

west. The city has demon-

Business Impact Fund, the Bank

strated its ability to promote

has already provided advisory

focuses on financing sustain-

high-tech business sectors and

support to more than 900 Roma-

able infrastructure, boosting

is known for its strong informa-

nian SMEs, including regional

private-sector productivity by

tion technology (IT) industry

business leaders such as Arobs,

helping private companies ex-

and excellent academic sector.

Ciserom, and Unilact.

pand and improve their work-

The Cluj-Napoca office will

“We have supported hundreds

In Romania, the EBRD

force skills, and developing

mainly support local small

of companies across the coun-

the financial sector and capital

and medium-sized enter-

try through direct and indirect

markets. To date, the Bank has

prises (SMEs) in the region with

investment, as well as through

invested almost EUR 9.7 bil-

expert advice, training, and

advisory projects, and we now

lion in the country’s economy,

access to finance. Through the

want to increase our support for

through 488 projects.

support projects with innovative

SME Division of Alpha Bank

and digital components: IMM

Romania.

Prod, Garant Construct, Rural Invest and Innovation.

“We understand the challeng-

Mircea Varga has been appointed as Chairman of the Board of Directors at TEILOR Holding. Varga is an executive with over 26 years of professional experience in multinationals and local companies from various industries, such as PwC Romania and Tiriac Group. He has proven expertise in M&A and capital raising, organisational transformation, organisational change, and crisis management.

The new governmental programmes are designed to help companies access investment

es faced by entrepreneurs who

and/or working capital credits,

are developing businesses and

supported by state guarantees

creating jobs, and we are pre-

of up to 90 percent of the value

pared to support their projects,

of the requested financing,

inter alia, by granting financing

issued by the National Credit

through these new programmes

Guarantee Fund for Small

designed to improve the com-

and Medium Enterprises

petitiveness and resilience of

(NCGFSME), the Rural Credit

the local entrepreneurial

Guarantee Fund (RCGF), and the

environment,” stated Dragos

Romanian Counter-Guarantee

Draghici, Manager within the

Fund (RCF).

Aleksej Koscejev has been appointed as Head of Growth for CEE at Revolut.

He will be based in the Berlin office, and responsible for building the business in Romania, Poland, Hungary, Czechia, Slovakia, Lithuania, Latvia, Estonia, Croatia, and Bulgaria.

With his expertise, he will scale Revolut’s marketing strategies to the mass market across the CEE region.

www.business-review.eu Business Review | June 2022

6 REAL ESTATE

Positive outlook for real estate market in 2022 Romania’s property investment volume in the first quarter of 2022 is estimated at EUR 68.5 million, a value that’s 7 percent lower than the one recorded in the same period of 2021. Analysts expect investments to reach EUR 1 billion in 2022, 11 percent above last year’s total figure, though it is difficult to make accurate predictions in this period marked by uncertainty.

By Aurel Constantin ter to 14.3 percent, also due to a significant volume of new offices being delivered during the period. Although most companies have started bringing their employees back to the office, the accommodation process is usually progressive: not all employees are required to work from the office every day of the working week, and to a certain extent, the hybrid practice of combining office and home work continues. The first quarter of the year saw a high level of new deliveries, totalling 73,500 sqm, compared to only 29,500 sqm in Q1 2021.

The largest project delivered during Q1 was Sema Office London & Oslo, with a total of AFI Lakeview

O

approximately 31,500 sqm GLA, developed by River Development in the Centre-West submarket. Two projects of roughly 21,000 sqm

ffices accounted for almost 80

Unexpired Lease Term) significantly longer

each were also delivered in Q1. The first one

percent of total investment volumes

than the market average can achieve yields

was phase 1 of @Expo, developed by Atenor

during the first three months, while

below those quoted as prime, with quality

in the North-West (Expozitiei) submarket, fol-

retail accounted for the rest. The largest in-

and ESG compliance (Environment, Social,

lowed by Tandem, delivered by Forte Partners

vestment deal closed in Q1 2022 was the sale

Governance) playing a major role in future

in the Centre submarket.

of the Record office scheme in Cluj-Napoca

transactions.

Another 83,000 sqm are due to be added to the market before the end of 2022, bringing

for a reported EUR 35 million. Speedwell sold the project to AYA Properties Fund from Bel-

OFFICE MARKET

total deliveries for the year to 156,500 sqm.

gium. The second-largest deal in Q1 was the

Demand for offices is improving as the total

This would represent a 36 percent decline

sale of Vitantis Shopping Center in Bucharest,

gross transaction volume in Bucharest during

compared to 2021. The Centre-West submar-

with approximately 36,000 square metres

Q1 2022 reached 69,500 sqm, 17.5 percent

ket will attract almost 60 percent of all deliv-

GLA. Revetas Capital sold the property to

below the previous quarter, but 36 percent

eries expected for the year—over 90,000 sqm.

Praktiker Real Estate, according to a report by

over Q1 2021. On the other hand, net take-up

The largest project expected to be completed

JLL Romania.

increased by 30 percent compared to the pre-

by the end of 2022 is the second phase of One

vious quarter, to 45,600 sqm and more than

Cotroceni Park, developed by One United

doubled when compared to Q1 2021.

Properties, adding around 34,500 sqm to the

Q1 2022 marked a decrease in prime industrial yields, from 7.75 percent in the previous quarter to 7.5 percent. After consecutive

New leases had the largest share in total

Centre-West submarket. The second building

contractions in the previous two quarters,

transaction volumes in Q1 2022, with approxi-

in AFI Tech Park, developed by AFI Europe,

prime office yields remained flat during Q1

mately 60 percent of the total, followed by

will increase the stock of the same submarket

2022, at 6.75 percent. Prime retail yields were

renewals and renegotiations, with 21 percent.

by 24,500 sqm. The vacancy rate is likely to

also stable during the period, at 7.25 percent.

The vacancy rate slightly increased during Q1

drop in 2022 due to the lower number of new

Prime assets with WAULT (Weighted Average

2022, from 13.7 percent in the previous quar-

deliveries over the next three quarters.

www.business-review.eu Business Review | June 2022 May 2016

COVER REALSTORY ESTATE14 7

RETAIL MARKET Following the decline in intensity of the covid-19 pandemic in Romania in the first quarter of 2022, the state of alert was lifted on March 9th, together with all remaining pandemicrelated restrictions. This was encouraging news for the retail market, and it is likely to be reflected in second quarter figures. Retail sales increased by 5 percent year-on-year in March 2022.

After strong retail deliveries in the last quarter of 2022, only 16,500 sqm GLA were introduced in Q1 2022, only slightly more than a quarter of the deliveries of the previous quarter. By comparison, there no openings were recorded in Q1 2021. The only major retail project to be launched in Q1 2022 was Colosseum Mall, the 16,500 sqm shopping One United Properties, office building

centre added to the existing Colosseum Retail Park in the north-west area of Bucharest.

Following a relatively low volume of new

followed by Ploiesti, with a 31 percent share

stock would reach 6.36 million sqm by the

deliveries in 2021, supply is estimated to

(87,600 sqm) and Arad, with 10.2 percent

end of the year.

increase by 73 percent in 2022, up to a total of

(29,000 sqm).

184,100 sqm GLA, mostly through retail parks

Deliveries of industrial and logistics spaces

RESIDENTIAL MARKET

in medium and smaller cities. After the open-

totalled approximately 155,400 sqm across

The number of transactions with new units

ing of Colosseum Mall in Q1, only 13,000 sqm

Romania in the first quarter, 36 percent less

in Q1 2022 stood at around 7,760 units for Bu-

are expected for delivery in Bucharest until

than in the previous quarter but five times

charest and 1,680 units for Ilfov; 60 percent of

the end of 2022, in two retail parks adjacent to

more than in Q1 2021. Almost 81,000 sqm

the Bucharest transactions officially regis-

residential developments: Greenfield Plaza,

were delivered in the Bucharest region, repre-

tered by the National Agency for Cadastre and

developed by Impact Developer & Contractor

senting nearly 50 percent of all completions.

Land Registration were for new units, while

in Baneasa, and Lemon Park, developed

new sales represented 90 percent of the

by Synergy Construct in the Damaroaia

total transactions in Ilfov. This represents

neighbourhood.

a 13 percent decline from the previous

In regional cities, the pipeline for

quarter, a predictable evolution based

2022 is mainly represented by small and

on seasonality. Despite the social and

medium-sized retail parks. One notable

economic impact of the Russia-Ukraine

exception is Alba Iulia Mall, with 28,900

conflict, the new housing sales market

sqm GLA, which will be delivered by

performed much better than expected

Prime Kapital and MAS Real Estate.

in Q1, especially in March. Overall, the first quarter saw a 15.3 percent increase

INDUSTRIAL MARKET

compared to Q1 2021 and a spectacular

The Romanian industrial market had

increase of 54 percent compared to Q1

a good start in 2022, with total demand

Another 25,000 sqm were delivered in Deva

reaching 284,300 sqm. However, this was 41

and 19,000 sqm in Constanta. At the end

percent below the previous quarter, which

of Q1 2022, the modern rentable industrial

as a result of the record level of deliveries in

had hit a record level, but 9 percent over Q1

stock in Romania totalled approximately 5.8

2021, with transactions being negotiated and

2021. Net take-up accounted for 85 percent of

million sqm. Encouraged by strong take-up

secured in 2021 and concluded through final

total take-up in Q1 or approximately 242,600

in 2021 and early 2022, developers plan to

sale-purchase agreements in Q1 2022. For the

sqm. This is 27 percent below the previous

deliver another 530,000 sqm of industrial and

short and medium-term, analysts foresee that

quarter and 47 percent above Q1 2021. Bu-

logistics spaces by the end of this year. This

demand for new homes will be significantly

charest accounted for 42 percent of the gross

would bring total completions for 2022 to

impacted by the continuous increase of the

demand for industrial and logistics spaces in

685,500 sqm, 30 percent over those recorded

key interest rate combined with high inflation

the country in Q1, with around 120,000 sqm,

in 2021. If everything goes to plan, the total

rates.

2020.

This positive evolution is seen by analysts

8 COVER STORY

www.business-review.eu Business Review | June 2022

A BUSINESS BASED ON THE PHILOSOPHY OF PERFECTION

www.business-review.eu Business Review | June 2022

COVER STORY 9

Since its entry on the local market, back in 2017, real estate investor and developer Hagag Development Europe has been working to reshape the local urban landscape.

Within less than five years, the company has become one of the most prominent real estate players in Romania and the SEE region, by staying true to its three main principles: design, culture, and service. The company’s business vision is based on the philosophy of perfection, and it pays little attention to passing trends. Hagag Development Europe’s strategy is built around timeless properties that transcend trends and create excellent value that doesn’t sway away. Yitzhak Hagag, co-founder of Hagag Development Europe, sat down with Business Review and talked about the company’s approach on the local market and its plans for the future, both in Romania and abroad.

By Anda Sebesi What is the story of Hagag Development Europe and how has the company developed since its entry on the Romanian market back in 2017?

139, finalising construction works on H Tudor Arghezi 21, and con-

Hagag Development Europe is an experienced real estate investor-

old buildings with patrimonial value, and introducing to the market

developer, operating in Europe and being publicly traded on the Tel-

upper-premium projects such are H Eliade 9 and H Primaverii 1 are

tinuing our investments in key areas, exploring, shaping, growing the niche segment of urban renewal through the reconversion of

Aviv Stock Exchange (TASE).

all among our top achieve-

Our group of companies is

ments. I also think it is relevant

involved in the purchase,

to mention that over the past

development, renovation, and

six months alone, as a result

management of several assets

of our latest acquisitions, the

located in both privileged and

market value of our portfolio,

emerging locations across Bu-

as completed, has gone up by

charest and other major cities

more than 50 percent, from

in Romania. Since 2017, when

EUR 200 million to over EUR

we opened our local office, we

300 million. Likewise, this Au-

have been tirelessly working on

gust we will be celebrating our

reshaping the urban landscape.

first year as a publicly traded

Our land and property portfolio

company on the Tel Aviv Stock

has been growing every year,

Exchange.

and we are currently managing over 250,000 square metres

estate players in Romania and the SEE region, and that it is directly

What can you tell us about your company’s positioning on the Romanian real estate market through the projects it develops and how is Hagag Development Europe different from other real estate developers?

responsible for the development of some of Bucharest’s most el-

Modesty aside, what we are doing is truly unique. Our iconic projects

evated residences and office buildings.

have raised the benchmarks and they continue to set the standards

GBA of residential, office, commercial and, more recently, hospitality projects. I am delighted to say that within less than five years, our company has managed to become one of the most prominent real

in terms of premium real estate development and luxury living as

What are the company’s biggest achievements in Romania?

our portfolio expands in Bucharest and secondary markets across

First of all, Romania is an emerging market, and as all other emerg-

the nation. Our vision for the local market and our investment strat-

ing markets, it is highly prone to risk. And yes, Bucharest has

egy are the main differentiators. Moreover, regardless of the purpose

enormous potential, secondary markets are on the rise, and the real

of each of our projects, we pay close attention to three core criteria:

estate sector as a whole has become more mature; still, the tense

design, culture, and service. I am talking about a holistic approach

social-economic-political climate, the covid-19 pandemic, and the

designed to offer an exclusive experience to residents and tenants

recent Russian-Ukrainian conflict have been pushing everybody’s

alike—whether it’s for living or working, in a refurbished building or

limits. In this context, I believe that being here for five years now,

a new development, downtown or in north Bucharest. When you

with a firm intention to stay and ambitious plans for the future, hav-

walk into an H property, you should feel like you’ve walked into a 7*

ing delivered unique projects such as H Victoriei 109 and H Victoriei

hotel. That’s because we are inspired by imagining how people are

www.business-review.eu Business Review | June 2022

10 COVER STORY

going to respond to—and interact with—what we are building, and

in 1835, and it’s as revolutionary now, in 2022—even though it’s on

how our projects are going to create memorable moments and spe-

the verge of collapse nowadays. What’s more, iconic properties in

cial communities. Even at H Pipera Lake, our large-scale affordable

prime locations do not devalue over time. No matter the market

luxury development, we are working on integrating several elements

fluctuations, there will always be strong demand for high quality

such as concierge services or property and facility management,

and unique architecture. In good market conditions, you get a good

which are usually only available for premium projects.

return of investment for such products. On the other hand, if the market is temporarily shaking, you have great downside protection.

How would you describe Hagag Development Europe’s vision and how does it get translated into the projects the company develops in Romania?

What are the most recent business updates for your operations in Romania?

Our vision is based on the philosophy of perfection. Perfection is

We started 2022 on the same positive note in which we ended 2021,

what elevates and distinguishes each of our developments, as do

and lately we have been very busy ”shopping,” consolidating our

the sites and locations we choose. We don’t care much about trends;

presence in the region, and expanding our local team. In Q1, for ex-

they’re just not part of our vision and who we are as a company. We tend to focus on timeless properties that transcend trends and create excellent value that doesn’t sway away. Trends come and go; our properties and the business we are building are here to stay. As we see it, real estate is not a short-term game. At least not the real estate that we invest in. We have a very well-articulated strategy and we only buy prime assets in key locations.

And what I really like about what we are doing is the fact that we have the opportunity to purchase super prime real estate, add our personal touch, and make it great. We strongly believe that true luxury is a matter of choice, and our unique value proposition offers clients something beyond tangible things.

This includes the views, the building’s personality, the historical

ample, we completed two new transactions: we purchased an old of-

influence, the unrivalled amenities, and so on. Most of the time, es-

fice maze on 5-7 Vasile Lascar Street, and a plot of land of over 1,300

pecially in Romania, “luxury” gets mistaken for “expensive,” but it is

sqm located at 1 Primaverii boulevard. Also in terms of business

actually about the experience. It’s not about adding more marble or

updates, we have recently launched our second upper-premium

bronze or more square feet or the best fixtures. Sure, all of that mat-

residential boutique, H Primaverii 1, which—judging by the number

ters and definitely helps. But what “luxury” means is being cared

of inquiries we have received from both clients and media since

for and taken care of—being able to clear your head, to be inspired,

the news about us purchasing the land got out — I actually believe

to inspire others, and to be your best self. This is what we want to

was the most highly anticipated announcement on the residential

express throughout our projects.

market so far.

In terms of leasing and sales, we are also pleased to post out-

What is the reason behind your decision to invest in the central areas of Bucharest?

standing results for the first half of the year. Our office building H

Coming back to what I was previously saying, our decision of direct-

139 is sold out, phase I of H Pipera Lake (435 units) is also sold out

ing a significant part of our investments towards central areas is

and completed, and we have recently started pre-sales for phase II,

linked to our long-term vision for Romania and to the uniqueness

where almost 200 units were reserved in just two months of project

of our brand. The city centre has been neglected by investors and

marketing. H Eliade 9 remains, too, a prestigious undertaking for us.

developers for almost two decades, and it would be a pity not to

Almost half of the units available for sale have been contracted.

Victoriei 109 is fully leased, the residential boutique H Victoriei

explore its beauty and potential. The properties we own in downtown Bucharest are some of the most beautiful buildings in the city.

Palatul Stirbei, for example, was revolutionary when it was built

What are Hagag Development Europe’s plans for the local market?

www.business-review.eu Business Review | June 2022

To sum up what could be a very long phrase, I believe the proper

COVER STORY 11 Moreover, the fact that Romania has the oldest stock of resi-

word to use in this case is “expansion.” We are simultaneously work-

dential units in Europe further underlines the country’s growth

ing on planning, designing, launching, and marketing new projects,

potential. But the real problem here is urbanisation, and I think that

all while looking into several other properties and plots of land that

the natural outcome in this context is for the residential segment to

have caught our interest. Aside from Romania, we are also looking

continue to develop. Even when it comes to mass-market projects,

into opportunities abroad, in more than one European metropolises.

clients are becoming increasingly demanding. They have higher

And yes, in the long run, our intention is to expand across both

expectations and their preferences and behaviours are and will be

Romania and other countries in Europe.

reflected in what the offer will look like 10 years from now. As an innovative player, when we designed our mass-market project H

How do you think the Romanian real estate sector will evolve in the coming years?

Pipera Lake, we took into consideration the long-term evolution of this particular segment, so we are already working on a product that

We are very optimistic about

will meet the future clients’

the future of this market.

needs.

Romania has shown a lot of resilience throughout the

when it came to the residential

More than once over the years, both publicly and unofficially, Hagag Development Europe has promoted art and culture and supported local artists. How do you see the intersection of art and real estate?

sector. The office segment has

In our view, real estate devel-

started moving again and, with

opment is by default a form

the recent entries of new inter-

of art. When building for the

national players, retail is also

future, we are creating some-

slowly making a recovery. As

thing aesthetically beautiful

far as we are concerned, Hagag

that adds value to the city’s

Development Europe remains

skyline while reviving the ur-

open to all opportunities. The

ban landscape as a whole. Our

current market environment is

buildings on Calea Victoriei

not deterring us from buying

are great examples. And since

real estate. We have the experi-

we own these superb proper-

ence, the know-how, and the

ties in such iconic locations

financial capacity to look past

that make them great places

the temporary fluctuations of

to bring art to the public, we

the market and comprehend

are very proud that the ground

pandemic, and even now in the unfortunate context of the Ukraine invasion. Over the past couple of years, the market has performed much better than expected, especially

the bigger picture, as depicted in a time projection of 10 to 30 years.

floor of our office building H Victoriei 109 hosts a space dedicated to contemporary art, The H Gallery, an eclectic space that’s perfectly

What do you expect the residential segment in Romania to look like ten years from now?

framed inside the natural contrast between the building’s impres-

Let’s just say that if the past few years have taught us anything, it

newest tenant is truly unique, as the main purpose of the gallery

was that time is the biggest luxury one can have. I personally believe

is to develop a less explored direction of the Romanian art scene,

that luxury living is shifting towards this narrative and that buyers

through collaborations with local and international galleries. Thus,

will continue to look for easily accessible homes that cater to this

the H Gallery will act as an intermediary in organising exhibitions

lifestyle. Even now, buyers are looking for homes that complement

and events. Its aim is to both shape the way the public interacts with

their lifestyle. And if you think that hotel brands are the best at doing

contemporary art and familiarise people with the various meth-

that, think again, because as a developer and manager of real estate

ods by which art is created, interpreted, and collected in a recent

assets, Hagag Development Europe has already started to move in

context. Accommodating a tenant like The H Gallery and supporting

this direction. H Victoriei 139, H Eliade 9, and H Primaverii 1 are all

its growth and development is just the beginning of our endeavour

about iconic locations that are remarkably connected to the core of

to create that perfect synergy between art and real estate. Just think

the city, premium services, fine amenities, and unique experiences.

about it: isn’t it fabulous to admire art while enjoying a glass of

We can call it upscale living if you like.

champagne in a magical setting?

sive architecture and the vibe of the emblematic Calea Victoriei. Our

www.business-review.eu Business Review | June 2022

12 MAIN STORY

Sustainable cities paving the way to a smart(er) future

The curtains dropped on Business Review’s Rising Cities. Smart Future 2022 after more than four hours of lively debate between top business leaders, local officials, the heads of the European Investment Bank and European Commission representations in Romania, and members of the civil society. The main conclusion was that without a clear strategy for making our communities more sustainable, it will be difficult for our society to keep up with European peers.

By Anda Sebesi, Aurel Constantin, Mihai Cristea

www.business-review.eu Business Review | June 2022

MAIN STORY 13

CHALLENGES AND OPPORTUNITIES FOR A SUSTAINABLE CITY The global trend is moving towards smart cities with efficient and environmentally-friendly buildings and cars. In the first panel of the conference, the discussions were centred on how a traditional city could be transformed into a smart one, by integrating the new environment, social, and governance (ESG) rules. These rules help us build clean cities, with clean and efficient consumption patterns.

In fact, ESG rules are rapidly becoming the norm for any construction project. As pointed out by Antoniu Panait, Managing Director at Vastint Romania, the ESG concept appeared relatively recently, but it is already being embraced, and big banks are using ESG evalua-

Victor Iancu, Associate Partner at KPMG Romania “For a year, I have been part of a project funded by the European Commission that guides cities in Romania towards becoming smarter. And what I have learned from dozens of cities in Europe is that they have a long-term strategy, which isn’t just a document written by the mayor's office, but a vision that transcends electoral cycles.”

tions to condition investments and access to financing.

In practice, it only took a few months for ESG to be adopted by Romanian companies, just like it usually happens when various new technologies appear. Lucian Enaru, Country General Manager at Schneider Electric, pointed out that unlike 20 years ago, when Romania was at the beginning of the road in terms of technology, all of today’s global innovations also reach our country right away.

But developing a smart city means more than adopting new technologies; first and foremost, it requires a medium and longterm strategy, involving all stakeholders. Claudiu Bisnel, Managing

Antoniu Panait, Managing Director at Vastint Romania “Smart cities are already green, as smart can’t be separated from ESG. A few months ago, ESG seemed like a distant thing, but it’s already here and we will depend on it more and more for financing and lending.

Large banks are already conditioning their investments on ESG valuations. And smart cities will need big investments and tailormade projects.”

Partner at Brisk Group, explained that public authorities cannot be expected to create such plans on their own. They need support from the civil society and the business environment. It is well-known that authorities rarely manage to create long-term strategies that transcend electoral clichés, but according to Victor Iancu, Associate Partner at KPMG Romania, the pandemic has shown us that we can mobilise to adopt new plans quickly, especially since we have examples of cities in Europe from which we can learn. In fact, as pointed out by Razvan Parvulescu, Business Development Coordinator at BTD Construct & Ambient, although there is a gap between Romania and Western states, it is a gap that we are recovering quickly.

UNLEASHING THE FULL POTENTIAL OF A SMART CITY A highly anticipated section of the Rising Cities. Smart Future conference was the second panel, titled “Unleashing the full potential of Smart Cities,” where top business professionals from major industries—such as Marius Motofei (Business Operations & Public Sector Director at Vodafone Romania), Adrian Huma (Sector Head for Automotive, Transportation, and Logistics at ING Romania), and Michele Giove (Senior Manager for Government and Public Sector at EY Romania)—sat face to face with Lara Tassan Zanin, Head of the European Investment Bank’s Bucharest office, and two of the most high-profile local public officials of the moment, Brasov Mayor Allen Coliban and Bucharest Sector 1 Mayor Clotilde Armand.

Panel moderator Dan Borbely, Partner at Tuca Zbarcea & Asociatii, started off with a short introduction: “The way I see this panel is that we have all interested parts on stage: the targets, the money, the private sector, and the consultants—so we have all the ingredients for a meaningful discussion and I’m sure we’ll draw some interesting conclusions about what can we do to unleash the full potential of our cities.” One of the key components of the smart city concept, as seen by the European Union, is the smart environment,

Razvan Parvulescu, Business Development Coordinator at BTD Construct & Ambient “Where there’s been communication between the authorities, civil society, and the business community, these smart city plans have been successful and effective.

It is clear that these projects are long-term and they must also take sustainability into account, which is going to happen as we build over the coming decades. There is a gap between Romania and Western states, but it is a gap that we are recovering quickly.”

Claudiu Bisnel, Managing Partner at Brisk Group “Urban development requires a long-term strategy, and to achieve this strategy you need to integrate all the stakeholders. We need integrated thinking that brings all the visions together and puts them in order for a long-term plan. Authorities can’t do this alone; they need support from the civil society and the business environment.”

Lucian Enaru, Country General Manager at Schneider Electric “We’re having a hard time transitioning to smart cities because we lack a long-term strategy. But the pandemic has shown us that we can quickly adopt technologies and develop new projects when we are forced by the general context. Romanian society easily accepts new technology trends, and we have an appetite for new technologies.”

www.business-review.eu Business Review | June 2022

14 MAIN STORY

Lara Tassan Zanin, Head of the EIB Group Office in Romania “Municipalities must be key drivers of Romania’s green transition. It’s good to have green projects and vision at the central government level, but those who can make a real difference are the mayors, by promoting smart cities and factoring sustainability into their projects.”

Michele Giove, Senior Manager for Government and Public Sector at EY Romania “We have been working to support local and national authorities in designing their policies and decisions and to improve the manner in which they deliver services.

What we have seen through working with different cities around the world is that technology is not the driver of smart city transformation. The real drivers are the citizens and the needs of the community.”

Allen Coliban, Mayor of Brasov “The smart city concept is not new. What is new is that the discussion is no longer just about technology. It is about integration, sustainability, energy-efficiency, and many other aspects. The new approach for smart mobility is not car-centred, but humancentred. Brasov is the city with the largest fleet of green buses.

Ioana Ciocan, general manager at Art Safari “In 2015 we started with just 3 kids in the Art Safari project; this year we’ve included 10,000 of them. We also offered this opportunity to 3,500 disadvantaged kids last year and I think that we managed to generate a real change in these communities. This concept could be applied across several districts in Bucharest.”

Clotilde Armand, Mayor of Bucharest’s Sector 1 “Everything we are doing is centred around the green concept, and green energy means investments. When I became mayor, the first complaints that I heard were about heating. The Sector 1 heating network is not sufficient to cover the demand. What I did was to propose and carry out studies for solar heating and heat pumps fuelled by photovoltaic panels.”

Silvia Floares, Co-founder at Mezanin Market, Roditor Food Market, and Weekend Sessions “All three of our projects allow us to promote an important selection of local entrepreneurial startups and artists.

Citizens of Bucharest need a chance to fall in love with places in Bucharest they may not like or don’t recognise the value of. If we imprint emotions onto some places, we will connect Bucharest with its citizens.

This is the only way to make Bucharest a better place.”

Marius Motofei, Business Operations & Public Sector Director at Vodafone Romania “A smart city is a city where people are happy, where they want to raise a child, care about their elders, have fun and entertainment options, and of course, pay taxes. Transportation is one of the biggest sources of pollution, noise, and stress in our cities. Using data to make smart decisions is very important for transportation, and nobody knows this better than a telecom company.”

Andrei Bortun, CEO at The Institute “There are about 15,000 schools in Romania. If we placed separate waste collection bins across one of the largest infrastructures in Romania, we could settle an entire process. If we brought together a group of citizens who are involved in their communities and willing to vote for likeminded leaders, and perhaps one day become leaders themselves, we’ll have a better future.

Adrian Huma, Sector Head for Automotive, Transportation, and Logistics at ING Romania “We can help the private sector by offering guarantees to participate in public projects, because municipalities require these types of guarantees. Another way we can help in smart city transformation is through financing, because even though there are lots of grants available, they don’t always cover the entire cost of a project.”

Cristian Danciu, co-founder at Charger.ro “It’s becoming more and more apparent that the urban population of Bucharest feels a real need for crucial change while looking for new adventures in their neighbourhood. It is fascinating to see how their perspectives improve, even though the urban environment and the design of the city remain unchanged in many ways, including in terms of architecture, investments, and infrastructure.”

www.business-review.eu Business Review | June 2022

MAIN STORY 15

and cities will have a key role in the green transition proposed by the EU. As the EU’s climate bank, the EIB aims for 50 percent of the projects it manages throughout Europe to be climate-friendly by 2025, while the other 50 percent will have to be carbon neutral, explained the EIB’s Lara Tassan Zanin.

OPINION: Ramona Chiriac, Head of the European Commission’s Representation in Romania

“Municipalities must be key drivers of Romania’s green transition. It’s good to have green projects and vision at the central government level, but those who can make a real difference are the mayors, and I was happy to see two of them taking part in this conference!” the Head of the European Investment Bank’s Bucharest office said.

LIVING SUSTAINABLY The last part of the event was dedicated to the actions of the most passionate “City Changers” aiming for a more beautiful and sustainable urban life. All panel participants highlighted the importance of creating a community around Bucharest to act as a driving force for the further development of the Romanian capital.

“While at the beginning of our activity we would focus on projects dedicated to a specific industry or sector, in the past 10 years we’ve shifted towards collaborative projects which have tried to generate community involvement. Today, we are trying to approach each of our individual events as tools for a greater, common good and with a long-term social value,” says Andrei Bortun, CEO at The Institute. He adds that the lack of financial resources, partnerships, and know-how in the local civil society have led to many organisations and specialists in the field becoming more resilient. “It is fascinating how Romania and its society continue to develop regardless the difficulties they face. I think we could think of it as some kind of a European vocation for a part of our society who are dedicated to making this country develop in many directions,” Bortun said. However, he also warned that there was just a “transactional” relation between Bucharest as a city and its citizens, likely due to the fact that around half of them are first-generation inhabitants.

Education plays a crucial role in training young generations to live in a healthy and sustainable community, fostering talents who can collaborate towards better urban living. But education is equally necessary for both young generations and older adults.

“Sustainability has many layers, from concept, vision, and strategy to the tools and technical solutions that can be used to implement it on various business lines: transportation, food, energy, and utilities,” says Cristian Danciu, co-founder at Charger. ro.

In turn, Ioana Ciocan, general manager at Art Safari, had a similar opinion about the importance of education among young generations. She added that in the very beginning of the Art Safari project, back in 2014, she decided to develop an educational project for kids who wanted to visit a museum or go to a concert.

“This was possible by making arts understandable for them. In 2015 we started with just 3 kids; this year we’ve included 10,000 of them in the Art Safari project.”

We are in a very difficult post-pandemic and geopolitical context, which forces us to reflect upon our European identity, the future of our continent, and our values. The future of our planet has been an issue of major concern for some time now. The Green Deal is the EU’s answer to the climate and environmental challenges that represent the defining responsibility of our generation. It is a new strategy for development aiming to transform the EU into an equitable and prosperous society, with a modern, competitive, and efficient economy. It is about a Europe with net zero greenhouse gas emissions by 2050 and about a focus on the environment and healthy citizens. Through the new European Bauhaus, we intend to make the Green Deal tangible and add a cultural dimension to the economic and technological change. This is crucial if we want Europe to become the first climate neutral continent by 2050.

The EU is the first region in the world to have put its environmental and renewable energy targets into law. We are a global leader the transition towards a clean, sustainable, and circular economy. A third of the EUR 1.9 budget will be spent on environmental policies across all our financing programmes.

The new European Bauhaus has three building blocks at its core: sustainability, design, and inclusion. We want to protect the future of our planet, including its energy security, which is increasingly relevant in the new geopolitical context that forces us to make the shift towards renewables. When it comes to design, we’re talking about a vision inspired by art and culture that goes beyond functionality. Finally, inclusion means focus on community, dialogue between cultures, academic discipline, and access to welfare for all communities, including vulnerable ones. In conclusion, the new European Bauhaus is a community and society that has citizens at its core.

At the global level, buildings are responsible for more than 40 percent of energy consumption and one third of the carbon emissions. Over half of the waste is generated by construction and demolition. Therefore, it is clear that to achieve our goal of becoming climate neutral by 2050, we need to change the way in which we build, renew, live, and consume. The Green Deal comes with a clear concept and roadmap for the new European Bauhaus, with four key priorities: reconnecting with nature, regaining the feeling of affiliation, prioritising vulnerable places and individuals, and reorienting towards the circular economy concept. The new European Bauhaus contributes to the creation of a new framework for smart city design, with the aim of transforming the urban environment, reducing pollution, and bringing long-term social value.

www.business-review.eu Business Review | June 2022

16 FDI

Regional economies are contracting.

How will Romania hit FDI objectives?

High inflation and the effect of the war in Ukraine will drain growth later this year in the entire region, Romania included, despite GDP growth of 6.5 percent per year in the first quarter. These effects will also be visible in the foreign direct investment (FDI) segment, particularly in greenfield investment.

Romania is now facing a problematic economic context

A

By Claudiu Vrinceanu

fter solid economic development in

when it comes to attracting FDI, and sharp

tion must have an essential role in site

2021 (5.9 percent), this year's growth

investors will continue to pursue prospects

selection, incentives, data collection,

rate will be much slower, at around

in emerging markets, the Romanian economy

bureaucratic certification, and company

2.6 percent, according to a forecast by the

could better position itself among others

establishment procedures.

European Commission. The causes listed by

competing for capital by focusing on the fol-

the European institution are high inflation,

lowing pillars:

ing corruption and indecision around

which is eroding revenues, and the war in

•

The stability and predictability of the

regulations. Investors and companies

Ukraine, which is influencing economic

tax system. It must be a priority for the

need more clarity on the rules to be able

sentiment, supply chains, and investment.

authorities to maintain an attractive

to invest confidently. With a score of 45

By 2023, the Commission expects a slight ac-

business environment. According to the

out of 100, Romania remained one of the

celeration in economic growth to 3.6 percent,

Foreign Investors Council, only under

worst-performing countries in the EU in

amid a long-awaited decline in inflation. The

such conditions will the private sector

the 2021 Corruption Perceptions Index

war is worsening the existing investment

be motivated to continue investing in

difficulties.

our country and provide jobs for its citi-

•

Improving transparency, but also reduc-

released by Transparency International.

•

Defining a new competitive advantage

zens. Any change in the fiscal framework

for the economy in terms of foreign

from an economic point of view, foreign

without proper impact assessments and

investment, by focusing on industries

investments will be carefully judged and

dialogues with the business community

where Romania may be more attractive

correlated with any chance of risk. A UNC-

could compromise the potential for

than countries in the region with which

TAD review of the Ukraine war's impact on

economic development, which is mainly

it is directly competing (Poland, Hun-

trade and development confirms a rapidly

based on attracting foreign direct invest-

gary, Bulgaria, Serbia).

As Romania enters an unforeseen area

ment.

worsening outlook for the world economy,

Providing information on investment opportunities, contact information

izer prices. The report also shows increased

tive measures dedicated to attracting

for regional and local authorities, and

financial volatility, sustainable development

foreign investment, and making this a

information on investment procedures,

divestment, complex global supply chain

priority for the coming period.

company registration, and legislation.

Developing the long-awaited govern-

This approach should generate contacts

reconfigurations, and mounting trade costs.

•

•

Satisfying the need for proactive legisla-

underpinned by rising food, fuel, and fertil-

•

mental investment promotion agency.

with potential clients and provide infor-

challenging, and Romania is now facing a

The new body should be the first entity

mation for potential investors through

problematic economic context due to high

investors interact with and serve as an

simple activities such as liaisons with

energy prices, inflation, and geopolitical in-

intermediary between foreign investors

foreign embassies and business associa-

stability. While Europe remains competitive

and the government. Ideally, the institu-

tions.

Luring foreign investors has always been

www.business-review.eu Business Review | June 2022 May 2016

COVER ECONOMY STORY 17 14

Romanian entrepreneurs building advisory boards even as recession looms Romanian entrepreneurs are starting to develop their advisory boards even in these times of economic uncertainty. Their motives are related to the opportunities they’re seeing over the short and medium-term: raising financing, starting internationalisation ventures, expanding their business networks, and even preparing for exits.

By Claudiu Vrinceanu they have encountered personal barriers in the internationalisation process. When asked about specific barriers, Romanian exporters point to the lack of connections, knowledge, and information about target markets. The need for internationalisation is high in the Romanian business environment: the list of the 100 largest exporters in 2021 only includes four companies owned by local entrepreneurs: Chimcomplex, Aramis Invest, Romcab, and Cerealcom.

For Romanian firms seeking to expand Romanian tech companies have managed to raise investments of millions of euros

their global footprint, a formal advisory committee delivers access to advisors with in-

RAISING INVESTMENT

EXIT STRATEGIES

ternational expertise and market knowledge

A board of advisors is a group of business

Many shareholders of mature Romanian

as well as connections to support their ambi-

professionals that delivers advice on how

companies are now thinking more carefully

tions and strategy execution. The support

company owners can better manage their

about a final exit for two strategic reasons:

and knowledge sharing can take many shapes

operations and growth. One of the roles of an

on the one hand, they anticipate possible

depending on the business’s particular needs,

advisory board is to help raise capital. While

falls that will influence the company's valu-

product or service coverage, and the market

they are not involved in the daily fundrais-

ation. On the other, founders believe that

they are entering.

ing process, advisory board members can

consolidating companies is more efficient in

open doors to key potential investors. In the

times of economic change. They prefer using

EXPANDING BUSINESS NETWORKS

growth phase, the need to finance companies

an advisory board to help manage an exit

Growing investment and access to specific

remains high, and access to money is more

transition. Whether they expect an exit in the

new markets and resources that involve

difficult when a recession is imminent.

next year or not for years to come, having an

slightly lower costs are directions that Roma-

advisory committee to focus on this specific

nian managers are exploring in the context

ty, Romanian tech companies have managed

topic can yield results. The context is still

of the current crisis, according to a Confidex

to raise investments of millions of euros.

suitable for transactions: the Romanian merg-

study. Therefore, expanding business net-

ers and acquisitions (M&A) market has shown

works to attract new customers and partners

by Druid (EUR 14.3 million) and Bunnyshell

resilience despite complex geopolitical and

has become a priority for Romanian entre-

(EUR 3.8 million) represent 60 percent of the

macroeconomic challenges. According to con-

preneurs and managers. A well-connected

total investments obtained by startups in

sulting firm EY, the M&A market recorded 48

board expands an organisation’s contacts and

2022.

transactions in the first three months of 2022,

can help build or grow its reach on relevant

up 17 percent. Despite the higher volume of

markets. Additionally, board members can

tech projects that have attracted investments

transactions, the estimated value of local

utilise their connections to help with funding,

in 2022 so far include: Machinations (EUR 3.3

M&A is USD 1.8 billion, compared to USD 2.1

establish strategic partners, connect with

million), Ogre AI (EUR 2 million), Adservio

billion in Q1 2021.

vendors, and join other industry specialists.

Despite the period of economic uncertain-

The two largest financing rounds attracted

In order of investment value, Romanian

(EUR 2 million) Archbee (EUR 1.9 million),

In this context, firms are looking to create

Tokinomo (EUR 1.6 million), and Stailer (EUR

SCALING ABROAD

strong advisory boards that can also help

1 million).

Two out of three entrepreneurs believe that

expand these business networks.

www.business-review.eu Business Review | June 2022

18 TAX

Tax, Law & Lobby 2022: Digital transformation making slow progress in public institutions The 19th edition of Business Review’s conference dedicated to Tax, Law & Lobby topics touched upon the legal and fiscal issues of recent years and highlighted the urgently needed digitalization of our country’s entire public system. The pandemic, the economic and social crisis, and the war in Ukraine have forced us to make major changes to our tax system and embrace the digital economy.

We should see a package of fiscal measures to combat inflation in Romania

R

By Aurel Constantin

omania’s tax system has had a

tax amnesty that companies can still benefit

regarding possible changes in the coming

significant evolution over the past

from. A positive change that was among the

period. “The expectation has to do with

few years. July 1 will be an important

results of pandemic measures is the easier

certain VAT rates being lowered, but it will

date because it is the deadline for our country

and faster repayment of VAT, as well as the

be a political decision. Everyone's concerned

to implement the latest updates coming

procedure to reschedule debts to the Fiscal

with the decline in purchasing power, and

from the European Commission. “The most

Authority (ANAF),” said Bianca Vlad, Tax

we should see a package of fiscal measures to

important changes were those enacted at

Partner at Mazars.

combat inflation, which is now reaching very

the beginning of the pandemic, such as the

As for the VAT system, speakers agreed

high levels,” said Theodor Artenie, Head of

that not much had happened over the last

Tax Practice at Noerr. The main issue is the

few years, but they had high expectations

fact that incomes have not increased, while spending has seen a sharp rise. Everyone

”ROMANIA’S TAX SYSTEM HAS HAD A SIGNIFICANT EVOLUTION OVER THE PAST FEW YEARS. JULY 1 WILL BE AN IMPORTANT DATE BECAUSE IT IS THE DEADLINE FOR OUR COUNTRY TO IMPLEMENT THE LATEST UPDATES COMING FROM THE EUROPEAN COMMISSION,” INGA TIGAI, ASSOCIATE PARTNER, HEAD OF TAX AND

”IF EVERY EMPLOYEE OF A LARGE COMPANY TAKES 2 OR 3 PENCILS HOME, THE TOTAL LOSSES REACH A VERY HIGH LEVEL, EVEN IF THE GAIN IS VERY SMALL AT THE INDIVIDUAL LEVEL. THE SAME HAPPENS WITH TAX EVASION,” THEODOR ARTENIE,

”THE FISCAL PARADIGM HAS CHANGED AS A RESULT OF THE 2008-2010 CRISIS, WHEN THAT PACKAGE OF EROSION OF REPORTING AND FISCAL OPTIMISATION BASE APPEARED,” BIANCA VLAD,

LEGAL TECHNOLOGY AT KPMG ROMANIA

HEAD OF TAX PRACTICE AT NOERR

TAX PARTNER AT MAZARS

www.business-review.eu Business Review | June 2022 May 2016

COVER STORY TAX 19 14

”THE DIGITALIZATION PROCESS IS NOT RECENT; IT STARTED MANY YEARS AGO. AN EXAMPLE IS THE ELECTRONIC PUBLIC PROCUREMENT SYSTEM, SEAP, WHICH EVERYONE IS FAMILIAR WITH, AND WHICH APPEARED 20 YEARS AGO, IN 2002,” ROXANA POPESCU, DIRECTOR OF

”THE HIGH VOLUME OF REGULATIONS RESULTS IN A LOW-QUALITY PUBLIC POLICYMAKING PROCESS AND CAUSES BOTH INSTITUTIONS AND BUSINESS REPRESENTATIVES TO BE PERMANENTLY FOCUSED ON SOLVING URGENT LEGAL MATTERS,”

APPLICATION SUPPORT AT AUTHORITY FOR

OCTAVIAN RUSU, PUBLIC POLICY EXPERT

THE DIGITALIZATION OF ROMANIA

& FOUNDER AT ISSUE MONITORING

is trying to solve this problem by reducing

functioning 90 percent of the time. Another

spending, as it’s the only immediate way to

important system has been Ghiseul.ro, al-

fight inflation.

lowing users to pay their taxes online, which

“If we’re talking about tax fraud, it is very

”IN THE INSOLVENCY PROCESS OF CITY INSURANCE, WHICH CITR IS CARRYING OUT, WE SAVED RON 700,000 JUST BY USING EMAIL INSTEAD OF THE CLASSIC MAIL TO NOTIFY CREDITORS,” ALINA POPA, HEAD OF LEGAL AT CITR

exceeded one million users this year, partly

difficult to stop when it becomes generalised.

as a result of the pandemic,” said Roxana

For example, if every employee of a large

Popescu, Director of Application Support at

company takes 2 or 3 pencils home, the total

the Authority for the Digitalization of Roma-

losses reach a very high level, even if the gain

nia. Unfortunately, there is an inertia among

is very small at the individual level. But it’s

state institutions in terms of digitalization.

easier not to fight the phenomenon, because

Many town halls purchase their own online

it is too expensive to watch each employee to

tax collection systems instead of connect-

”PUBLIC INSTITUTIONS SHOULD FOLLOW THE LAW AND MAKE THE DATA AVAILABLE TO THE PUBLIC, BUT UNFORTUNATELY EVERY INSTITUTION APPLIES THE LAW BASED ON ITS OWN INTERPRETATION,” ADRIAN MANTOIU,

prevent them from taking a couple of pencils.

ing to Ghiseul.ro, which is free of charge and

The same happens with tax evasion,” The-

much simpler to implement.

MANAGING DIRECTOR AT WOLTERS

odor Artenie also argued.

But the way companies operate has also

“Public institutions should follow the law

KLUWER ROMANIA

and make the data available to the public, but

gone through changes in recent years. “The

unfortunately every institution applies the

fiscal paradigm has changed as a result of

law based on its own interpretation. Just like

processes as possible, including the auction

the 2008-2010 crisis. Recently, the European

people, institutions too must have access to

part, which can be carried out online.”

Commission issued a fiscal package with new

digital education in order to gain the degree

measures around intra-community transac-

of confidence required to use digital systems,

new regulation (law, ordinance, decision or

tions and cross-border invoicing, which will

and that takes time,” says Adrian Mantoiu,

order) is adopted in Romania every 3 hours,

be implemented in all EU countries,” Bianca

Managing Director at Wolters Kluwer Roma-

coming to a total of approximately 4,500

Vlad noted.

nia.

regulatory acts every year. The high volume

Unfortunately, the problem is that a

An example of successful digitalization

of regulations results in a low-quality public

DIGITALIZING BUREAUCRACY

in the private sector was provided by Alina

policymaking process and causes both insti-

Digitalization doesn’t just mean scanning

Popa, Head of Legal at CITR, who showed

tutions and business representatives to be

some documents and putting them into a

how the insolvency process was broken into

permanently focused on solving urgent legal

digital file; it must bring added value for both

pieces in order to automate and digitalize

matters. “At Issue Monitoring, we save time

companies and individuals. “The digitaliza-

what was possible. “In the insolvency process

for our clients and send them real-time alerts

tion process is not recent; it started many

of City Insurance, which CITR is carrying out,

when initiatives go through these stages. In

years ago. An example is the Electronic Public

we saved RON 700,000 just by using email

2021, we sent 6.5 alerts every hour (13,530

Procurement System, SEAP, which everyone

instead of the classic mail. Of course, that was

alerts in total) and we followed 1,737 regula-

is familiar with, and which appeared 20 years

only possible where we had the data, i.e., the

tory acts from over 20 sectors,” said Octavian

ago, in 2002. It was very difficult to manage in

email addresses of creditors who had to be

Rusu, Public Policy Expert & Founder at Issue

the beginning, but we’ve been able to keep it

notified. We’re trying to digitalize as many

Monitoring.

20 ENTREPRENEURSHIP

www.business-review.eu Business Review | June 2022

Startup valuations and investments see rebalancing amid economic turmoil Major international issues related to the Ukraine crisis, high inflation, growing interest rates, and a slowdown of major economies are all rattling the startup funding market, meaning that entrepreneurs might have a harder time securing necessary funds in the coming year. Faster routes to profitability are set to become a hot topic among startup founders and investors as sky-rocket valuations begin to lose steam.

By Ovidiu Posirca

If an entrepreneur is currently in the final stages of raising capital, the best move right now would be to speed up the talks and close a transaction

www.business-review.eu Business Review | June 2022 May 2016

G

lobally, venture financing was down

ENTREPRENEURSHIP COVER STORY 14 21

The median post-money valuation for

ing down from the international stock

2.9 percent to USD 148.8 billion in

companies heading into a liquidity transac-

exchanges towards Series B and A, generated

the first quarter compared to the

tion declined slightly from USD 1.04 billion

by an expected deep recession. On the other

in Q1 of 2021 to USD 963 million in 2022.

hand, there is still an abundance of capital,

same period of last year, according to a report by professional services firm KPMG. Across

Late-stage startup valuation took a

Europe, funding actually rose by 10 percent

significant hit this year, as did the entire

to USD 31.7 billion in Q1 versus the same

tech sector on public markets, adds Cristian

period of 2021.

Munteanu, managing partner of Early Game

On this background, the outlook for startup valuations is unpredictable, with

Ventures (EGV).

He tells BR that “the shock wave will

some market commentators saying that we

probably propagate upstream, and startups

are entering correction territory.

in the early stage will also see a decrease in

Startup valuations are mainly affected by public market corrections, as company peer

valuation, albeit less punishing.”

Market research shows that the high

especially for early-stage startups with more flexibility and adaptability. Bogdan tells BR

groups are usually selected from publicly

inflation environment will have a downward

that we are soon going to find out which of

listed companies, and we have seen major

impact on private equity valuations.

the two trends will be the stronger one.

corrections on these stocks lately, suggests

PE valuations have continued to

Marius Ghenea, managing partner at private

increase over the past decade,

equity and venture capital fund Catalyst

due in part to low inflation

Romania. For instance, shares of communi-

and the zero-interest-

cations company Zoom fell 38.9 percent in

rate environment,

the past six months, while streaming giant

but this trend has

Netflix has seen its shares dropping by 66

reversed and will be

should have realistic

percent.

reflected by the data

expectations, fund

in the coming quar-

managers suggest.

“In my opinion, inflationary issues and the war in Ukraine are secondary factors—

ters, according to a

that indeed could slightly influence valua-

report by PitchBook.

tions—but they are not the most important ones,” Ghenea tells BR. Data from Carta, a company that manages

Alexandru Bogdan, CEO & GP at startup investment fund ROCA X,

WHAT CAN REPLACE ENTHUSIASTIC VALUATIONS Founders looking for financing in the current environment

“Recently, on our early-stage market, I have seen multiple inflated valuations for barely MVP-level startups

equity programmes, shows that compared

says that Central and East-

to the first quarter of last year, Q1 2022 saw

ern Europe will see a battle between

similar valuations among companies seeking

two trends. On the one hand, there is the

accept unrealistic valuations anywhere,” says

liquidity.

downward pressure on valuations cascad-

the CEO of ROCA X. This means that found-

with no revenues, and investors will certainly no longer be willing to

www.business-review.eu Business Review | June 2022

22 ENTREPRENEURSHIP

So far this year, the biggest single financ-

ers must keep a sharp focus on efficiency and

inflation. On the bank lending side, this will

not lose sight of the profitability target going

mean that costs will go up for borrowers;

ing round—worth USD 15 million—was closed

forward.

for startups, this could translate into greater

by DRUID, a local startup developing virtual

scrutiny from the financiers’ side.

assistants that can be used by companies of

Munteanu of EGV adds that unrealistic optimism and high valuations that are not supported by traction will meet resistance from investors or get ignored altogether.

If an entrepreneur is currently in the final stages of raising capital, the best move right now would be to speed up the talks and close a transaction. Ghenea of Catalyst Romania points out that founders that have yet to start negotiations for a funding round need to make an internal cash runway analysis.

“Many such companies should actually consider preserving existing cash and, if possible, reach breakeven and a positive cashflow situation by optimising costs,” he explains.

Nevertheless, certain industries such as IT, renewable energy, and agriculture remain attractive in the eyes of investors despite the many challenges.

Estimating the value of a company is already a very complex process, but in short, it represents the present value of its future free cashflows. However, many investors often rely on valuation multiples as a proxy for determining what a company is worth.

“When you have that much volatility on

“For the very short term, as the end of the

various sizes. Several smaller rounds of up to

year is just around the corner, I do believe

USD 1 million were also signed in the first half

we will see a slowdown even as new play-

of 2022.

public markets, you don't know what the

ers come to the scene, but in the medium

price [of a company] will be a week from

and long run I am very confident that the

director at professional services firm Deloitte

to around 2 percent of GDP. In the meantime,

Romanian ecosystem will keep on growing

Romania, points out that the inflationary

the key interest rate was hiked to 3.75 percent

and hopefully replicating the trajectory that

environment leads to an increase in financing

and central bank officials have signalled that

the Israelian ecosystem has had over the past

costs for all companies, regardless of size.

it could be lifted further in a bid to lower

10-15 years,” said the CEO of ROCA X.

Marius Vasilescu, financial advisory

now. It is difficult to figure out,” said Tomasz Tunguz, managing director at Redpoint Ventures, as cited in a PitchBook piece. With the stocks of some of the biggest US-based public companies already falling by 60 percent, startup valuations could follow the same pattern.

TESTING THE RESILIENCE OF ROMANIA’S STARTUP INDUSTRY The local startup sector is facing a series of challenges which are similar to those in other European markets, and funding is expected to slow down in the second half of this year.

The inflation rate is estimated to reach 12.5 percent by the end of 2022, while the economic growth forecast was recently cut down

“These rising costs mainly affect startups,

www.business-review.eu Business Review | June 2022 May 2016

ENTREPRENEURSHIP COVER STORY 14 23

A new survey conducted among 34 VC

due to their low level of maturity, but it is

million each. In Q2, the investment mar-

still too early to estimate what the impact

ket was set to slow due to the Ukraine war

will be on the entire ecosystem. Stagnation

combined with rising inflation and interest

investor Anthemis Group, shows that invest-

is the word that could describe the outlook

rates, said KPMG experts in a report. Fintech,

ments in European startups have continued,

for the startup funding environment until the

healthtech, and alternative energy are the

but that they’ve been more selective.

end of the year,” Vasilescu tells BR.

industries set to generate new funding deals

funds by Yann Ranchere, partner at fintech

Investors were asked whether valuations

Meanwhile, EU funds could help the local startup industry maintain its development momentum despite the cost pressure on other funding sources.

Ghenea of Catalyst Romania says that the Recovery and Resilience Plan for Romania (PNRR) has already allocated significant amounts for financial instruments, to be managed by the European Investment Fund (EIF) and committed to the creation of other funds. Additionally, Regional Development Agencies are also launching similar programmes across the country, which will increase the availability of funds for startups.

“However, the availability of funds does not automatically mean that all these funds will be substantially invested, as investment decisions will largely depend on the market situation and investors’ confidence,” Ghenea notes.

Talking about market sentiment, the EGV managing partner adds that investors will

across Europe as we move into the second

were higher than last year, stable versus last

be more prudent as the economy takes a

part of this year. The clean energy sector is

year or lower versus last year. All respon-

downturn.

of particular interest as the European Union

dents said that valuations were lower than

has published a plan to limit imports of fossil

last year at Series B+, and more than three

fuels from Russia.

quarters said the same of Series A, according

“There is still enough money on the market for promising startups. The not-sogood and the really bad ones will have problems raising, but this can simply be considered to be a return to normality,” Munteanu argues.

MASSIVE FUNDING ROUNDS IN EARLY 2022 Despite the Ukrainian conflict, VC investments in Europe proved robust in Q1, led by the USD 1 billion funding round closed by Checkout.com in the UK. Estonian mobility startup Bolt got USD 710 million, while Finnish

The KPMG report also points out that the

to the survey results published by Sifted.eu.

supply chain automation and optimisation

mix of geopolitical uncertainty and climate

However, valuations have not fallen as much

platform Relex raised USD 566 million. Five

change pressures could spur additional in-

at the earlier stages as these companies still

more startups in France, Turkey, and Italy

vestment in climatetech as well as in startups

have a long way to go before investors can

secured new rounds of more than USD 500

focused on energy and carbon management.

make an exit.

www.business-review.eu Business Review | June 2022

24 PHARMA

Striving to improve quality of life in Romania R&D and innovation are Servier Pharma’s main pillars of operational development, both in Romania and worldwide. BR sat down with Michel Eschenbrenner, the General Manager of Servier Pharma Romania, who talked about the company’s achievements since it entered the local market and its plans for the future.

By Anda Sebesi is the Group’s ambition to become a leader in oncology, too.

Besides our active involvement in local medical education and our multitude of partnerships, Servier is a true supporter of phase IV studies. In the last two years, two epidemiological studies—a national and an international one—have been carried out in Chronic Venous Disease, with the participation of more than 150 family doctors, dermatologists, and surgeons. These are valuable studies highlighting the impact of the pandemic on the management of patients with chronic venous disease.

Last but not least, I would like to mention Servier’s ambitious local approach in terms of social responsibility. We have been collaborating with over 25 associations and founda-

What have 30 years of Servier Pharma Romania operations meant for local healthcare services?

Since we entered the Romanian market three

medical education, as well as awareness and

tions since 2018 to provide access to educa-

prevention programmes, diagnostics cam-

tion and medical services for disadvantaged

paigns, and scientific events.

groups, to prevent and reduce early school

So here we are today, 30 years later, and

leaving, train medical and teaching staff, pro-

decades ago, we’ve placed all our expertise

we have over 300 active partnerships on the

vide psychological support for patients and

and R&D experience in the service of local

Romanian market with different societies,

healthcare professionals, and so much more.

patients, in order to better meet their needs

scientific and medical associations, patient

and find new treatments. Along the way,

associations, NGOs, medical colleges, federa-

we’ve built long-term partnerships that have

tions, medical universities and institutions,

helped us properly understand and adapt to

hospitals and clinics.

the Romanian medical context, but we’ve also given back because we believe in the

How does Servier Pharma Romania contribute to progress on the Romanian medical market?

We constantly launch our innovative products in Romania. In recent years, Servier

power of togetherness and we are aware of

What have been Servier Pharma Romania’s top achievements during this period?

how important strong collaboration is for the

We treat around 2 million patients every

in hard-to-treat cancers with more than 50

entire ecosystem.

month in Romania using Servier medicines,

percent of research and development dedi-

We’ve brought innovative practices to the

has significantly accelerated its investment

which means 12 percent of the adult popula-

cated to deliver significant advances in areas

market, from which medical services benefit

tion here. We hold the 3rd position in

of high unmet need that may truly move the

on daily basis. Our unique business model—

counting units and the 6th place in terms

needle for our patients. For more than 3 years

we are a pharmaceutical company governed

of value of the market share.

now, we have made oncological treatments

by a non-profit Foundation (Fondation

We provide support in areas such as

available in Romania for colorectal, gastric,

Internationale de Recherche Servier – FIRS)—

cardiology, where we are market leaders,

and pancreatic cancers, as well as for acute

gives collaborators the confidence that we

type II diabetes—where we rank second in the

lymphoblastic leukemia. We go beyond the

are a sustainable and stable organisation that

number of patients treated and treat about 20

innovation brought by our products; by

can pursue therapeutic progress to serve our

percent of patients registered by the National

working with the medical community in

patients’ needs. We’ve continued investing in

Institute of Public Health Statistics—as well

Romania, we explore new programmes to

R&D and supporting both online and offline

as psychiatry and, lately, oncology. In fact, it

support patients.

www.business-review.eu Business Review | June 2022

COVER BUSINESS STORY 25 14

Combining traditional and virtual work to fuel business performance Petronius Secareanu, General Manager at Canon Romania and Bulgaria, sat down with Business Review to talk about how the company helps its corporate clients become more productive and collaborate more efficiently, in a secure manner, in the hybrid work environment.

By Anda Sebesi According to Gartner, 82 percent

Mobile hub (locations outside of the office

of company leaders intend to

and the home, e.g., working from a café or a

continue allowing remote work-

hotel), and In-house print hub (a print room

ing as employees return to the

located within the organisation). Canon

workplace, while IDC expects

experts guided visitors through each hub

that 80 percent of enterprises

corresponding to real-life hybrid working sce-

will adopt mechanisms to shift

narios in different business departments like

to cloud-centric infrastructure

HR, Accounting, Finance, and print rooms

and applications, at a pace that

and presented the best solutions for manag-

is twice quicker than before the

ing documents and information to work more

pandemic, while Quocirca states

efficiently, safely, and collaboratively.

that 96 percent of organisations expect an increase in demand for collaboration services.

What are Canon’s main business directions on the Romanian market?

We support organisations in

Our focus on innovation increases productiv-

optimising their business pro-

ity and quality for our customers while our

cesses, combining the tradi-

expertise is driving technological advances

tional and the virtual to form a

across a range of industries that rely heavily

Hybrid work has become the new normal for many companies. What kind of solutions does Canon offer in this segment and what are their main benefits for users and companies?

hybrid workspace where paper and digital

on visual data. We are the only company in

documents coexist and are part of a new,

the world to have ranked in the top five for 36

harmonised way of working. Our leading and

years running, according to the latest ranking

integrated ecosystem of hardware, software,

of preliminary patent results issued by IFI

and services is designed to support compa-

CLAIMS Patent Services, based on informa-

Our comprehensive portfolio of solutions and

nies in their transformation journey, regard-

tion issued by the United States Patent and

services for managing documents and infor-

less of where their employees are working

Trademark Office. Keypoint Intelligence, the

mation is designed to streamline working

from. Whatever the situation and business

world’s leading independent provider of test-

processes in any organisation, while facilitat-

landscape, we combine Managed Print Ser-

ing services and analytical information to the

ing employee collaboration regardless of the

vices and Workspace Collaboration solutions

document imaging industry, awarded Canon

place of work. Canon's expertise and experi-

to help companies gain transparency and

with three coveted recognitions at Buyers Lab

ence guide businesses through their swift

control over the entire document lifecycle

(BLI) 2022: the “A3 Line of the Year Award”

digital transformation and enable them to

and build a bespoke approach to support their

and the “Most reliable A3 Brand” for the

easily extend their working experience from

digitalization journey.

exceptional performance and reliability of the hardware technologies used in Canon A3

the office to the hybrid workspace through

multifunctional printers; and for the fourth

cost-effective and efficient and providing

What can you tell us about Canon’s integrated experience titled The Road Show and its added value for customers?

high levels of data security and compliance.

The Canon CEE Hybrid Working Roadshow

enables businesses to track and control print,

featured a converted truck with a modern

scan, copy, and fax activity across their entire

business environment divided into 4 differ-

environment, even if it spans across several

ent hubs: Office & Co-working hub (satellite

locations, won the “Outstanding Cloud Man-

offices or subsidiaries/branches), Home hub,

agement Solution” award.

automated business processes and document management solutions, making it all more

How does Canon help companies become more productive in the context of hybrid work?

year in a row, uniFLOW Online, our secure cloud-based printing software solution that

www.business-review.eu Business Review | June 2022

26 BUSINESS

BAT aims to create a better tomorrow With a 25-year presence on the Romanian market, BAT is one of the major international investors operating in the country. Fred Monteiro, Central European South Area Director at BAT, tells Business Review about the company’s development over the years, its positive impact on the local economy, and its involvement in local communities.

By Anda Sebesi

BAT is the largest taxpayer in Romania and a strategic foreign investor. What is the company’s footprint and where is Romania on BAT’s investment map?

We are also proud to be the leader of the

ments here. Romania was the first country

local tobacco market with a market share

in the European Union to produce tobacco

of over 50 percent, as well as the biggest

consumables for glo, our innovative reduced

contributor to Romania’s state budget for two

risk product that heats tobacco, and our

BAT has been in Romania for 25 years now,

years in a row. In 2021, BAT had a total state

total investments in our Ploiesti factory have

since 1997, when production started at our

budget contribution of RON 11 billion (EUR

exceeded EUR 500 million.

factory in Ploiesti, and it has been one of the

2.2 billion) in taxes and excises, an increase

biggest international investors in Romania, a

of over 10 percent versus 2020. BAT also

partner of state authorities in combating

strategic employer, and a long-term partner

contributes positively to Romania’s trade

illicit trade, a severe phenomenon with seri-

of the Romanian economy. We are a strong

balance, as a leading producer and exporter

ous economic and social implications. Every

organisation, with major accomplishments

of agricultural products through its Ploiesti

year, we run national information campaigns

and a significant footprint on the local

factory, the group’s second largest factory in

through our Stop Contrabanda platform, and

market: EUR 125 billion in direct, indirect,

Europe: over 60 percent of the volumes pro-

we support Romanian authorities in their

and induced contribution to the Romanian

duced locally are exported to tens of other

efforts to reduce the smuggling volume. In Q1

economy and EUR 24 billion paid directly to

countries across the world.

2022, the cigarette black market in Romania

the state budget, mostly as excises and other

Romania is an important market for BAT,

In the past 25 years, BAT has been a strong

remained below 8 percent.

taxes, but also as salaries and other local

and we are committed to continuing the

BAT has also had a strong impact on the

expenses* over 25 years.

development of our business and invest-

local workforce, both directly, through em-

www.business-review.eu Business Review | June 2022

BUSINESS 27

ployees in BAT units, and indirectly, through

most of the measured biomarkers, the reduc-

over 11,000 devices have been collected for

our distribution and supply chain. BAT’s

tions seen in people using glo were similar to

recycling. Another recent initiative consists

three economic entities employ over 3,000

those in participants who stopped smoking

of five solar trees installed in Bucharest to

people in Romania, and another 30,000 jobs

completely.

provide green energy which is used to charge

are created through the company’s supply

BAT’s ambition is to have 50 million

electronic devices in both wireless and USB

and distribution chain. We invest in our

consumers of its non-combustible products

format while raising awareness on alternative

employees’ professional development and

by 2030 and to generate GBP 5 billion of

sources of energy and inviting the communi-

provide continuous training sessions, and we

New Categories revenue by 2025. The BAT of

ty to enjoy a relaxing moment and free Wi-Fi.

are happy that our efforts have results. We

tomorrow is a high-growth consumer goods

are proud to say that about 50 percent of our

company: global, consumer-centric, multi-

Romanian culture and art communities and

local colleagues have been with the company

category, with sustainability at its core.

we invest over EUR 1 million annually in supporting cultural events and some of the

for at least 10 years.

The tobacco industry is changing globally, and BAT has a strong commitment for A Better TomorrowTM. What is the company’s vision for the near and mid-term future?

We are also strong supporters of the

In recent years, ESG has become a strategic pillar in companies across sectors.

What is BAT`s vision on sustainability and community impact?

biggest festivals in Romania, such as Electric

In 2020 BAT has defined its sustainability

mercial partners, namely preventing minors’

Castle and SummerWell.

Furthermore, a responsible commercial behaviour in both our teams and our com-

agenda under the promising umbrella of de-

access to nicotine products, is also an im-

Innovation and tech are transforming all in-

livering A Better TomorrowTM, an ambitious

portant pillar of our sustainable business in

dustries, products, and consumer behaviours

objective across all business lines. Sustain-

Romania. BAT is constantly investing in edu-

ability is at the heart of our strategy

cational campaigns regarding the legal provi-

worldwide, and the tobacco sector is no exception. Our industry is transforming, and BAT’s business strategy is all about sustainability and building A Better Tomorrow

TM

for all

stakeholders, which includes reducing

and it is delivering consistent growth, encouraging more consumers to transition to reduced risk products** and reducing the health impact of As part of our environment pillar,

of its business by

we continue to grow

ers reduced risk alternatives** such as glo. BAT invests almost GBP 350 million a

have access to nicotine products. And we are happy that the National Consumer Protection Authority joined our campaign in 2019, underlining the importance of responsible commercial practices.

our business.

the health impact offering adult consum-

sions and the reasons why minors should not

our internal efforts to reduce waste and operate responsibly across the value chain. We focus constantly

BAT is a strategic partner of the Romanian economy. How could a sustainable fiscal framework be created in Romania in the coming period and what types of measures would consolidate the local economy?

We are committed to continuing our invest-

year in the research and development of its

on bringing our consumers along our

ment and building A Better TomorrowTM in

New Category products, and we now have a

sustainability journey and we undertake

Romania. As Romania’s largest contributor

broad portfolio of non-combustible nicotine

regular campaigns to inform them about the

to the state budget and one of the largest

products which includes tobacco heating

importance of simple gestures we can all do

international investors on the local market,

products, vapor products, and modern oral

to protect the environment and our com-

we consider stability and predictability to

nicotine pouches.

munities. In 2019, we launched the Choose

be the most important prerequisites for

responsibly for a Clean City campaign—the

economic consolidation. In our view, a stable

most innovative tobacco heating product.

first national campaign that included street

economic environment and a balanced and

Over the years, BAT has conducted more

bins for cigarette stub collection to be used in

fair fiscal framework for all nicotine products

than 300 studies on glo, including some

energy recovery. This year, we marked June

are essential in driving predictability for solid

to help assess the reduced risk of using

5th—World Environment Day—with an aware-

business development in Romania.

glo compared to smoking. BAT’s scientists

ness campaign in Bucharest showcasing cit-

also conducted the first controlled study in

ies as our second homes and the importance

the UK, spanning one year, and the results

of treating them as such in terms of waste

showed significant reduction in indicators

management, for the common good.

In 2018, we launched glo in Romania, our

of potential harm over 6 months for smokers

In 2021, we started the selective collec-

* SOCIO-ECONOMIC FOOTPRINT ANALYSIS for BAT ROMANIA, Civitta, 2021 **Based on the weight of evidence and assuming a complete switch from cigarette

switching to exclusive use of glo compared

tion campaign for the previous versions of

smoking. These products are not risk free and

with continuing to smoke cigarettes. For

glo, our tobacco heating device, and so far

are addictive.

www.business-review.eu Business Review | June 2022

28 TECHNOLOGY

Audio architecture changing spaces and lives As offices reopen, businesses are leveraging the power of audio to design a more compelling employee experience, according to Marie Stafford of Wunderman Thompson. Arizona-based company Spatial has created a flexible, scalable technology platform that powers immersive three-dimensional virtual sound experiences for realworld spaces, which are a lot less expensive than traditional solutions.

By Romanita Oprea music and biophilic sound, three soundscapes aim to create the ideal environment for different work modes. A welcome ambience for lobbies and reception spaces creates a sense of warmth and interconnectedness; a focus ambience reduces distraction and inspires relaxation; and an energising ambience for high-traffic or communal areas encourages optimism and motivation.

Sound has long been an afterthought in workplace design, yet according to research from Made Music, there is an 86 percent correlation between one’s reaction to sound and a subconscious desire to return to that space. Biophilic sound design has also been Spatial’s Holodeck experience showcased the power of sound to reshape our sense of place and inspire feelings of comfort, belonging, and safety

A

shown to improve employee engagement and productivity and could prove a surprising ally in delivering on employee wellness,

t the SXSW festival in Austin, Spa-

He compared what they do to “what great

which continues to push up the agenda. In

tial’s Holodeck experience showcased

thematic designers did 30, 40 years ago when

their cases the tracks have a natural connec-

the power of sound to reshape our

they built whole theme parks in three to four

tion, with each of the ambiences having been

years

inspired by nature’s four main elements of air,

sense of place and inspire feelings of comfort, belonging, and safety. A live demonstration

“The idea of a cumulative effect is deep

earth, water, and fire.

exposed visitors to the harsh sounds of a busy

in the philosophy of Meow Wolf's growth,

shopping mall, a hospital waiting room or

much as each of their installations is part of

the full lifecycle of work and rethinking the

a chaotic cityscape, then sonically whisked

a greater whole. Each table-sized container

purpose of the modern campus with their

them to an idyllic tropical beach with lapping

at the SXSW installation was unique but syn-

employees, immersive work design is coming

waves, a rainstorm in a lush forest or the

chronistic, like each room at Santa Fe’s House

to the forefront,” Michael Plitkins, cofounder

gentle burbling of an underwater lagoon. The

of Eternal Return reflects the individual artist

of Spatial, told Wunderman Thompson Intel-

technology has compelling applications for

or subset of the collective, and how Santa Fe

ligence. “We look forward to connecting with

the employee experience. Its presence contin-

interlinks with their other sites in Denver, Las

brands interested in enhancing the employee

ued during the most recent SXSW with some

Vegas, and whatever lurks behind that count-

experience throughout the day. Hybrid

site-specific work that melded Meow Wolf's

down clock. Sandra Wang, senior creative

work models inherently consider the unique

unique pop experimentalism with software

director for Meow Wolf said. “We have this a

strength of each workplace to maximise cre-

firm Spatial's auditory architecture.

“As leading companies are rearchitecting

macro-story that's happening with this show

ativity, teamwork, and performance and our

The evolution of the collaboration was

fits with the narratives that our happening

soundscapes deliver enhanced environments

organic, said Spatial CEO Calin Pacurariu, and

with our other exhibits. One seeps into the

in an easily scalable and customisable manner

it started off as a way for the company to get

other,” wrote the Austin Chronicle.

on the real-time interactive Spatial platform.”

feedback on its software. Spatial had been

In 2021, Spatial announced the launch

Spatial has also recently been working with

planning a SXSW activation even before the

of its first Future of Work Soundscapes, in

the California Institute of Arts (CalArts) and

2020 cancellation, and with the return of the

collaboration with sonic branding company

Roger Holzberg, founder of Reimagine Well, a

in-person festival, they looked to Meow Wolf.

Made Music Studio. Comprising a blend of

company that delivers immersive patient ex-

www.business-review.eu Business Review | June 2022 May 2016

COVER TECHNOLOGY STORY 29 14

periences through screens and virtual reality

is helping the blind better navigate their

gear. Both Holzberg and Shannon Scrofano,

way through the day using the head tracking

tecture builds an imagery of sound that can

a professor at CalArts, teach a course at the

features and Bose bone-conducting audio

also be seen and felt, presenting it across

school called Healthcare by Design. In the

glasses.

a 25-metre-long digital screen filled with

spring of 2021, the class partnered with Henry

According to Sound of Life, Audio Archi-

undulating abstract shapes. 21_21 Design Sight

Mayo Newhall Hospital to deliver immersive

IN ART

isn’t just any other “design museum” either.

experiences at their Santa Clarita Valley facil-

21_21 DESIGN SIGHT held the “Audio Archi-

Created by two industry heavyweights—archi-

ity.

tecture” exhibition in the summer of 2018,

tect Tadao Ando and fashion designer Issey

welcoming Yugo Nakamura as its director,

Miyake—it is, according to Ando, “not only a

soundscape is scalable once you fine-tune

whose unique forms of expression are highly

museum that shows exhibits, but also a place

your workforce's preferences. A welcome am-

regarded in web design, interface design,

for researching the potentiality of design as

bience might incorporate wind-related sound

and film. Within the music familiar to our

an element that enriches our daily life, a place

along with synthesiser pads/arpeggios, which

everyday life is a combination of elements:

that fosters the public’s interest in design by

may be geared toward lobbies as they can

layers of tone, sonic range, and rhythm form

arousing in them different sights and perspec-

Furthermore, according to Inc.com, the

spark warmth and feelings of connection.

tives on how we can view the world and

A more focus-oriented ambience, rather,

its objects.”

may be heavy with acoustic instruments,

“When Audio Architecture opened in

while also tying in the sounds of running

Japan for the first time in 2018, audiences

water, wind, and bird song, and human-

were mesmerised by the fresh perspec-

generated sounds. The focus ambience

tive integrating sound, video, and space.

may boost productivity as it is built for

For a seamlessly inclusive experience,

use in quieter working spaces.

details such as the sequence and length

At the same time, according to Forbes,

of each artwork were also carefully

other emerging research is providing

thought out. This year, 21_21 Design Sight

evidence that spatial audio applications

is set to take the exhibit beyond Japan.

can be effective for short-term stress

Teaming up with exhibition experts

reduction and even have the potential to

INCEPTION, Audio Architecture will

supplement clinical music interventions.

be showcased in Taipei’s Huashan 1914

Spatial audio is one solution to help fill

Cultural and Creative Park, a creative hub

in those missing gaps in the 2D digital

rebuilt from an abandoned sake factory.

reproduction of music or voice that

On top of its original vision, ‘to see the

leave our brains a bit less satisfied, if not

world with design,’ the exhibition aims to

stressed, tired, and confused.

allow visitors to ‘visualise sound,’ creat-

Addressing issues of low-resolution audio

a densely designed structure—architecture.

ing a fun connection of listening to music

and spatial disorientation in video conferenc-

There are few opportunities, however, to be

with your eyes,” Sound of Life wrote in 2020.

ing, Immersitech CEO Jim Poore says, “Spatial

conscious of this particular structure.

audio gives users the proximity orientation

Musician Keigo Oyamada (Cornelius)

As Masakazu Kitayama says, “music cannot be perceived with the eyes; it can only be

where your brain kind of knows that you

has written new music with a focus on its

heard with the ears. It is something special

hear it from the right, left, or centre. It’s

structure exclusively for this exhibition; it is

and different, isolated from visual orientation

such a simple thing, but when everything is

interpreted from the varying perspectives of

and space.”

monotonous, your brain has to deconstruct

spirited creators into disparate video works.

the different streams coming in from all the

Participating in this exhibition are nine

ate the ordinary things in life from a design

different people. That makes your brain work

creators who challenge new modes of expres-

perspective. Music was one of the elements

considerably harder and that’s one of the

sion with original sensibilities, by travers-

Masakazu Kitayama appreciated, but it was

main reasons why you see a lot of the stuff on

ing fields of film, animation, dance, graphic

rare to set the core of an entire exhibition

Zoom fatigue.”

design, illustration, programming, and media

around the concept of sound or music, let

design. Exhibition graphics are designed by

alone associate it with architecture. For him,

ing spatial audio technology to airline flight

Masakazu Kitayama (Help!). Moreover, the

it became necessary for the audience to walk

control systems to help pilots better manage

exhibition tries to construct a type of “audio

into a space built on the basis of sound, then

the multiple audio-based navigation signals

architecture” by repeating the music paired to

be immersed in an environment that allowed

they have to monitor simultaneously, so they

various films over and over, in the space dy-

them to acknowledge its transformation,

can reduce stress and stay more alert and

namically designed by Masamichi Katayama

visualised on-screen via a beautiful cross-

focused during takeoff and landing. HEAR360

(Wonderwall).

media collision.

The engineering team at VisiSonics is add-

His intention is simple: to learn to appreci-

www.business-review.eu Business Review | June 2022

30 ADVERTISING

Powerful Romanian-made regional and global ad campaigns Ready-to-drink cold tea brand FUZETEA, part of the Coca-Cola Company portfolio, has launched its first-ever global brand campaign across 87 countries, with the big idea behind it coming from McCann Bucharest. The campaign required the effort of multiple teams—in Bucharest, New York, Buenos Aires—and production was carried out on three continents, under the Romanian team’s coordination.

By Romanita Oprea TV spot, online and social media promotion, OOH, and collaborations with influencers.

“We are made of a mixture of contrasts, and the perfect fusion of contrasts makes the FUSET unique. This product is special not because of a single ingredient, but because of the extraordinary fusion between tea, fruits, and herbs, which is meant to arouse the senses in moments of active relaxation.

We are happy to offer ‘Made of Fusion’ to the modern explorers’ community in Romania,” said Iuliana Nedelcu, marketing director at Coca-Cola Romania.

The “Made of Fusion” creative platform was developed and launched by several agencies within the Interpublic Group, including TPS Engage launched in May the global campaign for Gap Yeezy Engineered by Balenciaga

T

McCann Bucharest, as lead agency, together with MRM Bucharest as lead digital agency.

The McCann creative team collaborated with

he shoot for the “Made of Fusion”

enjoy relaxing moments while staying active

the Coca-Cola team along with Egyptian di-

campaign took place in Italy and Uru-

and full of energy.

rector Ali Ali and international photographer

guay, with a team of two directors and

“We want to celebrate human nature in all

Ignacio Ricci. The campaign is produced by

two photographers from Egypt, the Nether-

its complexity, as reflected by our product’s

an international team of professionals from

lands, Argentina, and the UK.

diversity and fusion of ingredients. FUZETEA

around the world.

The campaign was developed around

is composed of elements as contrasting as the

“We wanted to give the FUZETEA brand a

the concept of fusion and started from the

people who drink it and the world in which

role in culture, a voice, and a point of view;

idea that all the things that are special in the

they live. What makes FUZETEA special

to bring people a revelation about how they

world—including people—are the result of a

are its three unique ingredientssaid George

can relate to the world, to what is happening

fusion of contrasts. “Made of Fusion” is an

Wheen, senior director of brand strategy tea.

to them, and to what surrounds them. We

end-to-end global brand creative platform

Over the next 3-5 years, the “Made of Fu-

humans are a fusion of contrasting experi-

based on a general truth: all life experiences,

sion” platform will launch several campaigns

ences—both good and bad, barriers and ambi-

even the most exciting ones, are, in fact, a

that will take consumers on a journey of

tions to overcome them, achievements and

fusion of dreams, fears, and adventures. The

exploration. In the second and third years of

failures, things we dream of, and things we

fusion of emotions reflects the very essence

the campaign, the platform will continue to

fear. They all merge and make us unique, bet-

of the product, a contrasting trio of soft tea,

develop new ways of interacting with “mod-

ter. By revealing that we are ‘Made of Fusion,’

cheerful fruits, and herbs. The platform

ern explorer” communities.

we wanted to inspire people to have a more

highlights the fusion of contrasts, with an emphasis on active relaxation, and invites us to

In Romania, the platform's communication campaign started and included a dedicated

optimistic attitude towards everything that happens in their lives,” added Catalin Dobre,

www.business-review.eu Business Review | June 2022 May 2016

chief creative officer at McCann Worldgroup.

COVER ADVERTISING STORY 31 14

countries! It was the other way around from

sumer insight, that they decided to develop

the Coca-Cola bracelet festival, where the

the campaign in 3 other countries, which

nescu, regional business director at McCann

idea came up here and then a whole world

gave us even more confidence in approach-

Worldgroup, FUZETEA is a brand that is very

took it over. This time, we had the chance to

ing future briefs. We ended up using Teams

close to the hearts of McCann’s Bucharest

make it global from the get-go,” said Lia Bira,

and WhatsApp to coordinate a photoshoot in

team. It’s young (3 years old, but already a

group creative director at McCann Bucharest,

Italy, which featured authentic home-cooked

global brand), energetic, and it has a very

for IQads.

meals that looked like the ones we all eat at

Moreover, according to Cristian Cali-

Another example of global success com-

home, which we might not post on Instagram

ing from a Romanian agency is TPS Engage,

but still remember for the perfect feeling they

which in May launched the campaign for Gap

create, precisely because they are authentic,”

ally in the past, when the global repositioning

Yeezy Engineered by Balenciaga, the new

said Mihaela Bourceanu, customer service &

pitch brief came in, we knew that it was our

collection from Kanye West (Ye), via digital

shot to help FUZETEA become the challenger

screens in 8 countries and 11 cities, including

brand we already knew it was. But this was

Bucharest. Since 2021, TPS Engage has been

not an easy brief; our client partners were

working with well-known artists and brands

looking for a long-term platform that would

like Snoop Dogg, Kanye West, Chance the

be both timely and timeless. To get this

Rapper, Duolingo, TikTok, GoDaddy, Morning

done, there was a huge IPG display of force

Brew, Picsart, India Times, Universal Music,

(agencies from within the group and around

HBO, and thousands of startups that are using

the world, each uniquely qualified to bring

marketing on digital screens in an innovative

specialised contributions to the work) and the

manner.

unique proposition in the Global RTD category.

“Having pitched both locally and region-

weeks from briefing to presentation were the

“Ye’s campaigns are a unique combina-

most intense (but also super gratifying) four

tion of minimalist and spectacular. We are

weeks of my life,” Calinescu said.

happy to mark the second collaboration

The insight and the Big IDEA are both

with the group behind the collection. The

broad, but also very specific, and they can be

entertainment and fashion sectors have truly

effectively leveraged on markets where the

embraced programmatic DOOH advantages,

brand is in its infancy and where product cre-

especially the benefits of our platform when

dentials need to be put front and centre, but

it comes to implementation speed and budget

also on markets where the brand has reached

optimisation,” said Diana Sumanaru, global

maturity and needs to differentiate itself

marketing manager at TPS Engage.

with a clear philosophy and tackle a purpose proposition.

Among the most well-known initiatives from TPS Engage was the viral GameStop

strategy director at Mercury360. For the cli-

screen from February 2021, which at the

ent’s part, Daniela Pontecorvo, chief growth

without the right team and the right client

moment is the most popular post in Reddit

officer at Costa d'Oro Italy, said: “We found a

partner. I am grateful for all of it. We had

history. Founded in Romania in 2018, the

strategic partner in Romania who knew how

people on both sides pushing boundaries

company is now present in over 42 countries,

to connect the world of the brand and the

and never settling. Getting a chance to work

with its main offices in Bucharest, New York,

consumer in a natural way, looking beyond a

with and learn from so many amazing and

Dubai, and Seoul.

specific need for communication, namely the

“All of this would not have been possible

super talented people for more than 9 months

At the end of last year, authentic Italian

launch of a new product image. Costa d’Oro

to deliver the global was so enriching and I

olive oil brand Costa d’Oro aimed to inspire

is a story about authenticity that was born on

would do that all over again. It’s only when

consumers to enjoy life in a genuine way,

the sunny hills in the heart of Italy and it is

the skillset matches the passion and the

through an integrated campaign signed by

being passed on to future generations, with

determination that amazing things happen,”

Mercury360 and adapted in Bulgaria, the

passion and skill, just as it was inherited. In

Calinescu added.

Czech Republic, and Poland.

an increasingly superficial world, the authen-

“It's a great feeling when you're working

“We won the pitch in 2020, the year

tic taste of our product aims to whet the ap-

on something that needs to feel global and

in which many brands acknowledged the

petite for an authentic lifestyle, which makes

very personal at the same time. And it's great

importance of courage in communication.

you feel that you are tasting life to the fullest,

to lead teams from all over the world from

We presented the client with a long-term

through all of your actions—from the genuine

here, in Bucharest, a small town in a small

strategic approach, which went beyond the

taste of the ingredients you use in the kitchen

country. I’ve had some experience on Coke,

specific campaign brief for the local mar-

to the point where you enjoy the meal and the

Fanta, and Sprite regionally, but it's a dif-

ket. The client resonated so well with our

things you choose to post on social media out

ferent feeling when you see your work in 87

proposal, which was built on strong con-

of the whole experience.”

www.business-review.eu Business Review | June 2022

32 BUSINESS

The road to recovery starts with a new mindset To find out more about the European Directive for restructuring, which must be implemented by all 27 EU member states by July 2022 Business Review talked to CITR CEO Paul Dieter Cirlanaru and Head of Legal Alina Popa in an exclusive interview.

By Mihai Cristea progress. Just like in medicine, we can all agree that prevention is better than treatment. That is the kind of mentality that we are looking to develop in business, too.

How will the restructuring legislation work?

A.P.: We invite the parties—the company and its creditors—to a negotiation. After they reach an agreement with the support of an insolvency practitioner, they go to the syndic judge, who has a minimum involvement in the process as a guarantor of legality and integrity. The judge verifies whether the

What is the current status of the Directive?

the International Monetary Fund, Romania

company is in difficulty, if the creditors’ vote

has been among the fastest-growing econo-

is carried out properly, if creditors are cor-

Paul-Dieter Cirlanaru: CITR was selected by

mies in Europe in recent years. Romanian

rectly treated, and if the proposed restruc-

the European Commission as the Consultant

insolvency legislation has improved signifi-

turing measures are viable. Then, the plan

of the Romanian Justice Ministry. The core

cantly under the strict observation of the

created by the insolvency practitioner must

team of experts that drafted the law included

World Bank group on Insolvency. What our

be implemented by the company, under the

seven professionals: syndic judges, academic

legal framework lacks are functional pre-in-

practitioner’s supervision.

professors, and insolvency practitioners. We

solvency proceedings, and that was our focus

P.-D. C.: We encourage entrepreneurs to be

carried out consultations with stakeholders

for the new proposed law. It will be a turning

open to the new prevention and restructuring

involved in the restructuring and insol-

point for companies and for our economy.

mechanisms because, at the end of the day, they bring a competitive advantage, help-

vency market, namely banks, businesses,

ing them to get out of difficulty but also to

notaries, bailiffs). We had studied various

How come judicial reorganisation in Romania has such a low success rate of 2-3 percent?

legislative frameworks on pre-insolvency

P.-D. C.: A World Bank report shows that most

tioned, it is still hard to identify the under-

and insolvency in the EU to identify better

of the SMEs that open an insolvency proce-

lying condition is. Even though we benefit

solutions to build both debtors and creditors’

dure are more likely to end up in bankruptcy

from the advantages of an emerging market

trust in pre-insolvency procedures. We un-

than undergo a successful judicial reorganisa-

and the solutions of modern legislation, we

derstood that restructuring involves strategic

tion. Why? Because entrepreneurs are facing

still need to understand what could moti-

compromise and a new mindset, consensus

the stigma of failure and tend to access the

vate somebody to access these tools. In my

and negotiation, but also the development

legal procedure very late. They often try to

opinion, we also need to look at the mindset

of an entrepreneurial profile to understand

solve the problem by themselves, they lack

of today’s entrepreneurs and at existing at-

what the client is going through. After public

the culture of partnership, of being stronger

titudes towards restructuring solutions. If we

debates across ministries and government,

together than separately, of asking for help

don’t learn that failure should be accepted

the law has now reached Parliament, and we

while is not too late. This is a change we want

and sometimes even encouraged in order to

are expecting it to be adopted by the end of

to bring into Romania’s entrepreneurial cul-

accelerate progress in our capitalist culture,

this month.

ture. We have modern legislation, but it’s in

we will remain unable to raise the level of ex-

vain if it is not applied. We need to leave the

pertise and practical solutions leading to real

How does Romania compare to other countries in terms of legislation?

stigma and fear of failure behind. And it is not

life success stories. Let’s turn distress into a

going to be easy, because our early education

chapter of a company‘s history rather than

Alina Popa: According to official data from

didn’t teach us that failing is a part of

see it as its inevitable demise.

authorities, syndic judges, and professionals (insolvency practitioners, lawyers, valuators,

improve business performance.

Considering everything that we’ve men-

www.business-review.eu Business Review | June 2022

COVER FOODTECH STORY 33 14

Key players in Romanian foodtech and lessons from other countries Romania is far from being a rising star in foodtech innovation, but experience sharing between startups and corporations and the emergence of specialised investors could change this situation. The development of platforms that have finally joined strategic investors’ portfolios is the only notable recent gain in the foodtech sector.

By Claudiu Vrinceanu aims to attract a new seed financing of EUR 750,000 to accelerate its development plans and technology investments.

The growth pattern is clear in terms of success stories: launch, grow, and exit to a strategic investor. Bringo, Gloria Food, and EuCeMananc are three examples of tech startups that have grown and eventually reached the portfolio of large retail or technology companies.

INVESTORS There are no specialised foodtech funds in Romanian hospitality entrepreneurs usually follow a vocational path

Romania; the largest transactions have been made by strategic investors. Globally, invest-

KEY INSIGHTS

retail, as well as a third cohort devoted to the

ment funds allocated more than USD 39.3

Foodtech is an ecosystem of startups and

concept of business as a service. According

billion to foodtech companies across 1,358

entrepreneurs working to innovate in the

to the F&B Business Accelerator, Romanian

deals in 2021, according to a PitchBook report.

following fields: supply chain, food research

hospitality entrepreneurs usually follow a

The funding accelerated because of the in-

and services, delivery, and consumer tech.

vocational path, and they have the desire to

creased e-commerce and food delivery trends

Good business ideas have included subscrip-

improve their entrepreneurial training and

amid the COVID-19 pandemic, environmental

tions to food and beverage services, access to

provide quality services to their custom-

concerns, and the drive toward automation to

cooking ingredients, and startups develop-

ers. However, periods of change such as the

reduce labour costs. For example, Romanian

ing new digital platforms for entrepreneurs.

pandemic and economic crisis can change the

startup Bonapp has announced a seed invest-

Subscriptions for ingredient providers are

modus operandi of companies in the hospital-

ment of EUR 800,000 from a group of inves-

based on users’ growing desire to cook at

ity industry. Change can also be observed

tors led by Up (formerly Chèque-Déjeuner).

home, but with ingredients that have already

among the new generations of entrepreneurs,

The other investors are Romanian VCs RocaX

been weighed and cut for their chosen recipe.

who tend to build businesses with high scal-

and Early Game Ventures and Hungary-based

Food and beverage subscription services rely

ability potential from the very beginning.

Impact Ventures.

What can we learn from other countries?

on the fact that users lack the time to order

TECH STARTUPS

Romanian foodtech startups are still primar-

Seven of the most active and experienced

ily relying on their founders' resources. If we

TOP PLAYERS

Romanian foodtech startups and scaleups are

look at Poland, we can see the involvement

One of the few initiatives focused on the

LifeBox, Comarket, Manna Foods, Clever Eat,

of corporations in the foodtech ecosystem.

foodtech sector in Romania, the F&B Business

Bonapp, Yummydiet, and Peelhy. LifeBox,

Carrefour has financed four Polish startups

Accelerator, is a programme developed on 3

the healthy food delivery startup, started its

in this sector to help them invest in product

verticals: Products, Services, and IT prod-

international journey last year by launch-

development, marketing, sales, and attracting

ucts for the F&B industry. The first cohort

ing its service in Hungary under the brand

investors. Even though most foodtech uni-

targets entrepreneurs who create products

FrissBox. Meanwhile, the Comarket platform,

corns are still consumer-oriented, specialists

for the F&B sector. There is also a programme

a SaaS for centralised procurement and a

are noting a shift to B2B business models, a

dedicated to IT products for hospitality and

B2B marketplace for the hospitality industry,

trend that should also be adopted in Romania.

food products.

www.business-review.eu Business Review | June 2022

34 INTERVIEW

Dentons hopeful for a bright future on the Romanian market This year, Dentons is celebrating a quarter century of delivering legal advice to clients in Romania and the region. Perry V. Zizzi, Managing Partner of Dentons Romania, sat down with BR to discuss how the practice of law has changed and the long-term outlook of the Romanian market.

By Anda Sebesi are accessible from

anticipated IPO of Hidroelectrica, a transac-

anywhere, day or

tion expected to be the largest Romanian IPO

night. We deploy

in history.

software that uses AI to review large volumes of documents.

This saves the client

Dentons has been present in Romania for 25 years, and you have been working here for almost 20. What changes have you seen on the market during this time?

money and time and improves accuracy.

Since taking over as Managing Partner in Romania, you’ve done a lot to shake up the office. What changes have you made so far, and what comes next?

Our legal team has grown by nearly 70 per-

What have been the most memorable deals you’ve worked on? What are you most proud of?

cent, and we recently occupied a second floor

being primarily state-centred to having a

So far this year, our Bucharest office

including two women, one of whom leads the

dynamic private sector. 25 years ago, the

attorneys have advised on matters worth

Banking and Finance practice and the other

focus was on privatisations and public infra-

well over EUR 18 billion, all of which are

who leads the Capital Markets practice. In

structure; today, we advise clients on a wide

landmark transactions in their respective

terms of revenues, we were one of the fastest

of range of areas. The investor base has also

sectors. Among these was a USD 15 billion

growing European offices in our Firm from

shifted from primarily eastern Mediterranean

data centre acquisition and financing, which

2020 to 2021.

to a mix that includes investors from Western

was managed by me and my team in Romania

Europe, North America, East Asia, India, and

and involved over 150 Dentons attorneys in

consolidate our market leading positions in

the Middle East. Romania’s accession in the

Europe, North America, South America, and

Corporate, M&A, and Real Estate. We are also

first decade of the 2000s to both the Euro-

Asia. Another very high profile matter this

actively recruiting to create Tax and White

pean Union and NATO paved the way for a

year was Romgaz’s USD 1 billion acquisition

Collar practices.

more diverse group of investors in a wider

of ExxonMobil’s offshore assets, as well as the

range of sectors. All these developments have

financing for it. At the beginning of this year,

shaped and consolidated both the Romanian

we assisted a consortium of four domestic

business culture and the practice of law.

and international banks on a EUR 125 million

Looking five years into the future, what do you see for the Romanian market, and what do you see for Dentons?

green loan facility for six commercial real

As I stated four years ago when I was appoint-

we work. Take due diligence for example.

estate assets developed by Prime Kapital, in

ed Managing Partner of Dentons in Romania,

A quarter century ago, we used to send an

what’s looking to be one of the most signifi-

we are committed to this market and are

army of lawyers to out-of-the-way places to

cant green real estate transactions of the year

here to stay. After a quarter century, we are

read dust-covered documents, take notes,

2022. Other landmark transactions include

larger, stronger, and better positioned than

then summarise findings in a report, often

the RON 555 million private placement of the

ever before. Interestingly, I believe the same

without the ability to check the documents

Bucharest municipal bond issue and the EUR

can be said about the Romanian market. I am

again. Fast-forward to the present: we

153 million bridge to bond structure for Elec-

hopeful for continued growth and achieve-

almost always have virtual data rooms that

trica. We are currently advising on the highly

ment over the next five years.

The Romanian market has evolved from

Technology has also transformed the way

of the modern office building that we moved into in 2019. We have hired four new partners,

In terms of future plans, we continue to

www.business-review.eu Business Review | June 2022

ARTS 35

Ioana Ciocan: “New generations of art collectors are emerging in Romania” For the 9th edition of Art Safari, the biggest art event in Romania, Business Review talked to Ioana Ciocan, the event’s general manager, about the current trends and challenges on the local and international art scene.

By Oana Vasiliu will be the fact that Art Safari will return in the fall, in the same place, with a resounding anniversary edition. We have long wanted to present Art Safari in a large format, especially since the effort we make to organise it is very significant, and this unique event deserves to last longer. In addition, Art Safari is also funded by the Culture Ministry this year, in an extraordinary recognition of the event’s leadership in the field of cultural projects and its potential to place Romania on the European art and culture map. (…) Moreover, this edition will showcase art worth over EUR 14 million, including works by Picasso and Dali, featured for the first time at Art Safari.

How would you describe the DNA of Art Safari?

masters—Aman, Luchian—and also acquiring

Even though the space where Art Safari will

super contemporary Romanian art, such as

take place will be the same as last year, the ar-

Boldness is key. Art Safari has been a daring

that of Irina Dragomir, who will have her own

chitectural concept of this edition, signed by

project from the very beginning. It takes time,

exhibition at Art Safari – 9th edition.

architect Ioana Corbu, will certainly surprise visitors, offering an exciting show at modern

hard work, but also courage to become the

standards. For the first time, the exhibition

in Romania. (…) The success of that 2015

What advantages does Art Safari bring to the Romanian art scene?

edition—20,000 visitors—gave us courage to

We are a leading brand in the field of art and

that will highlight every artwork in Art Safari,

organise the next editions and the chance to

culture, we have the power to reach wide

while the pavilion dedicated to the Picasso-

massively evolve, and here we are in 2022,

audiences, to shape behaviours, to bring art

Dali duo will be accompanied by music. (…)

ready for two editions in a brand new format:

in people’ lives in an unprecedented way, and

6 months of art in the heart of Bucharest.

convince them that art and culture represent

exhibited art has increased, because we are

important parts of our national identity in a

no longer talking about an insurance period

European and global context. We are a one-

of 10 days, but 6 months. And our border with

of-a-kind project in Romania, with a great

Ukraine does not help our insurance rates at

potential to place Bucharest and the entire

all, because now we’ve had to introduce a war

country on the European cultural map, not

clause into the policy. This was in addition to

just on a regional level.

the terrorism clause, which has been in place

largest and the most appreciated art event

Let’s talk about changes on the art market and the continuing art boom since the beginning of Art Safari. How does today’s market work? Can you point to specific trends?

space will also benefit from a lighting system

The value of our insurance policy for the

for several years. Our international partners

Romania has a relevant position in CEE and will have much to say in contemporary art,

What makes Art Safari so special this year?

have been quite concerned about this proxim-

and in recent years Art Safari has contributed

It will be the first time when Art Safari, a cul-

ity to Ukraine, but we are very happy that

to shaping tastes and educating the public,

tural project funded by the Culture Ministry,

there was no question of cancelling the event

including collectors. New generations of

will last 3 months, and the second year in a

or postponing it, because we are prepared to

collectors have begun to emerge over the

row when it will take place in the gorgeous

protect the artwork like every big museum

past few years, resuming the tradition of art

Dacia-Romania Palace, in the old city centre,

does. And people need art; it gives them

investment that had faded away during the

the future headquarters of Pinacoteca Bucur-

hope.

communist period. This new class of young

esti, on 18-20 Lipscani, through a partnership

collectors is discovering the great Romanian

with the Bucharest Museum. Another first

Art Safari will continue until August 7, 2022.

www.business-review.eu Business Review | June 2022

www.business-review.eu

36 FILM Business Review | May 2016

COVER STORY 14

Mihai Chirilov (TIFF): “The festival has established itself as a connective and vibrant experience” The Transylvania International Film Festival (TIFF) will return in full force between June 17-26, to the way it used to be before the pandemic. Business Review talked to Mihai Chirilov, TIFF’s artistic director, about cinema after the coronavirus.

By Oana Vasiliu What will be the size of the lineup at this edition? Will it be smaller than usual?

Square in Cluj, expecting to gather a couple

Castle in Bontida, marking the centenary

of thousands of viewers. So does “Met-

of this classic silent horror by F.W. Murnau,

It’s going to be just like in the good old times,

ronom,” the Romanian debut feature that

complete with a new score written for a

with almost as many movies and events as we

brought Alexandru Belc the directing prize

huge orchestra by the uber-talented Simona

used to have before the pandemic. As most

in the Un Certain Regard sidebar. Icelandic

Strungaru. I wouldn’t mind the nostalgia trip

people know, TIFF was successfully carried

writer-director Hlynur Pálmason returns to

provoked by the tribute screening of Buena

out as an in-person event even during the

TIFF after having been awarded here for his

Vista Social Club, the cult doc directed in the

pandemic, by sacrificing its usual size due to

two previous films “Winter Brothers” and “A

late ‘90s by Wim Wenders—especially since

an absence of indoor locations (in 2020) and

White, White Day,” with “Godland,” equally

one of the band’s last standing men Eliades

proper screening conditions (in 2021). Right

shown in the Un Certain Regard section.

Ochoa will be performing live in Cluj on the

now, there is no reason to hold back. (…)

The newest work by one of the Transylvania

occasion. Three other documentaries are not

There will be slightly fewer films than there

Trophy winners premiered in Cannes and

to be missed: “The Orchestra with the Broken

were in 2019, but all in all the 2022 edition

will get the coveted Surprise Film slot in Cluj

Instruments” (d. Yuval Hameiri), a highly

qualifies as a normal one—whatever “normal”

(watch out for upcoming news!). Elsewhere,

successful experiment that ended with an im-

might mean nowadays. The last twenty years

we are happy to host the Romanian premieres

pressive and cohesive performance of Israeli

have established the festival as an extremely

of: “Alcarras” (the Berlinale’s Golden Bear, d.

and Palestinian musicians using damaged

connective and vibrant experience, and these

Carla Simon); “The Good Boss,” the top win-

instruments; “The Balcony Movie” (d. Pawel

were precisely the values that were the most

ner at this year’s Spanish Oscars (d. Fernando

Lozinski), the simplest yet most clever idea

affected and endangered by the pandemic.

Leon de Aranoa, with Javier Bardem in the

for a film ever; and “The Round Number”

We want people back, congregating and

main role); the newest works by TIFF regulars

(d. David Fisher), with an edgy and fearless

communicating, getting together through

Peter Strickland (the outlandish “Flux Gour-

investigation of a tabu matter which is very

art. That’s why we are going to emphasise

met”), Ulrich Seidl (the provocative “Rimini”)

likely to stir controversy.

TIFF’s social dimension and the need for

and Chilean Matias Bize (the intimate and

cerebral dialogue by introducing a music

devastating “Private Messages”).

sidebar called Soundsquare, located in the

Last but not least, and possibly the

You’ll be much safer booking your ticket for one of the salivating Film Food events (matching a themed film screening with a

nicely refurbished inner courtyard of the Arts

greatest catch of them all, is the Krzysztof

sophisticated dinner prepared by a celebrity

Museum and dedicated to emerging bands,

Kieślowski retrospective, with most films

chef; they usually sell out quickly, so move

and by adding daily talks about certain films

shown in brand new restored prints, includ-

fast) or watching the newest—and shock-

debated by key public figures. (…)

ing the “Three Colors - Blue, White, Red” tril-

free—film directed by enfant terrible Gaspar

ogy, complete with a rare photo and multime-

Noe, “Vortex.” Gerard Depardieu as “Mai-

dia exhibition as part of the big Polish Focus

gret” is a treat, and so is the extended final

put together at this edition.

car chase in the action-packed Korean film

Which movies do you consider to be the greatest catches of the year?

“Escape from Mogadishu.” And if you want

Every film that has just been screened at

some roaring fun, take a chance with either

is a great catch. “Final Cut!” directed by Oscar

What should people make sure they don’t miss this year at TIFF?

winner Michel Hazanavicius opened the

First of all, the special screening of “Nos-

comedic romps or “Cop Secret”, a buddy-

French festival and now lands in the Unirii

feratu” in the spooky setting of the Banffy

movie parody with gay cops.

Cannes and reaches TIFF in such a short time

“The Unemployment Club” and its irreverent

www.business-review.eu Business Review | June 2022

ARTS 37

Romania’s presence at Venice Biennale Besides the Romanian pavilion at the Venice Biennale, represented this edition by director Adina Pintilie with her multichannel installation that emerges from her ongoing research on the politics and poetics of intimacy and the body, visitors can meet New York-based artist Andra Ursuta, choreographer Alexandra Pirici or Eugen Raportoru and his installation exploring the Roma domestic space.

By Oana Vasiliu

T

Andra Ursuta

Alexandra Pirici

he Venice Biennale returned this year

eral outlets as a top item to see at the event.

multifaceted and kaleidoscopic time capsule

with “The Milk of Dreams” theme,

In the Giardini, after the grand entrance and

which is grounded in an understanding of

curated by Cecilia Alemani, which

the colossal work of German artist Katharina

the significance of the narratives that such

includes 213 artists from 58 countries; 180 of

Fritsch, Romanian artist Andra Ursuta returns

objects embody, as well as their capacity to

them are participating in the International

to the Biennale to seduce the audience with a

inform and reflect Roma culture.

Exhibition for the first time. Of the 1,433

series of sculptures. This time, her sculptures

works and objects on display, 80 new projects

recall both American science fiction action

are conceived specifically for the Biennale

horror films, including “Preda-

Arte.

tor” and the “Alien” franchise,

When visiting the exhibitions, attendees

but ultimately they emphasise

will discover a world where everyone can

the vulnerability of the human

change, be transformed, become some-

form and the complexity of

thing or someone else, as the curator states.

desire. Moving forward in the

The “The Milk of Dreams” exhibition takes

Giardini’s main exhibition space,

Leonora Carrington’s otherworldly creatures,

you’ll meet with Alexandra Pirici,

along with other figures of transformation, as

Romanian artist and choreogra-

companions on an imaginary journey through

pher, who will likely capture your

the metamorphoses of bodies and definitions

attention through her live perfor-

of the human. In Romania’s pavilion at the

mance, Encyclopedia of Relations

Biennale, Adina Pintilie imagines a space of

(2022). She assembles groups

togetherness, beyond borders and binaries,

of actors and performers into

exploring the central role of intimacy in the

formations that she describes as

everyday. Nurtured by long-term collabora-

live sculptures, which act, move,

tion with the protagonists, the Romanian Pa-

shift, and sing. A collateral event

vilion is transformed into a contemporary ca-

is taking place at Istituto Veneto

thedral that celebrates connections between

di Scienze, Lettere ed Arti, where

bodies beyond any preconceptions. The video

Eugen Raportoru presents his

installation was highly acclaimed by interna-

magic-carpet post-Soviet Romani

tional media, having been mentioned by sev-

seraglio. The artist has created a

The Venice Biennale continues until November 27, 2022.

www.business-review.eu Business Review | June 2022

38 CITY

Cultural calendar

By Oana Vasiliu

For this edition of the festival, a

Theon Cross, Ilhan Ersahin’s Is-

total of 575 theatre, contempo-

tanbul Session, Lucy Woodward,

rary circus, and dance perfor-

Radu Valcu Quintet, Muntet, and

mances are scheduled in Sibiu,

TajNic Trio. Attendance is free of

in central Romania. More than

charge.

3,300 participants are expected at the event, and a total of 30,000 tickets are available for 116 on-

Pet Shop Boys concert July 4, Arenele Romane

site performances. If you don’t get your ticket, don’t worry: the festival’s programme also includes 170 open-air performances.

alt-J concert June 22, Arenele Romane

year with a show promoting the “Blackest Blue,” which was com-

Postmodern Jukebox concert June 28, Arenele Romane

The Pet Shop Boys will return

posed during the pandemic and

The Postmodern Jukebox pop-

to Bucharest after 14 years, in

released in the spring of 2021.

jazz phenomenon continues

their “Greatest Hits Live” world

The album explores the types of

its world concert tour, which

tour. The band is one of the most

experimental sounds that we’ve

began in 2021, titled “The Grand

successful duos in the UK’s music

been accustomed to hearing

Reopening Tour.” They are entic-

history, with over 22 singles in

from the London over the course

ing audiences with a sensational

the UK Top 10. Tickets now on

Indie rock band alt-J, originally

of their career of almost three

party in the style of the ‘20s,

sale.

from Leeds, UK, has been ac-

decades, continuing the musi-

with a live performance from the

tive on the music scene since

cal journey that has established

Great Gatsby times. Tickets still

2007. alt-J includes Joe New-

them as pioneers of the British

available.

man, Gus Unger-Hamilton, and

music scene and made them

Thom Green. They returned in

known in all corners of the world,

2022 with their new album, The

with millions of albums sold.

Dream. alt-J are one of the most

Tickets available.

tenth Morcheeba studio album,

Placebo concert July 13, Romexpo

JazzX Festival July 1-3, Timisoara

successful British bands of the millennium. Tickets are still on sale.

Morcheeba concert June 24, Arenele Romane

Sibiu International Theatre Festival June 24 – July 3, several locations in Sibiu

Beloved band Placebo, one of the most popular musical groups in the UK, is coming back to Bucharest. It was founded in 1994 by soloist and guitarist Brian Molko JAZZx is going to be a mix of

and bassist Stefan Olsdal, both

jazz, contemporary instrumental

of whom continue to play with

music, and emerging projects

the band. The band has released

that go beyond the boundaries of

seven studio albums so far, all of

musical genres. So far, the festi-

which have reached the TOP 20

val has announced Stanley Clarke

in the UK and have sold over 11

Skye Edwards and Ross God-

N 4EVER, Hiromi - The Piano

million units worldwide. Tickets

frey will return to Romania this

Quintet, Ashley Henry Trio,

are available.