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Krakow welcomes Unicorns

Many years ago companies like Shell, Motorola and IBM decided to call Krakow home to their new business operations teams. It wasn’t clear if this was just a small experiment by these global multinational companies or not. Many years later it has become clear that the experiment has become a trend. A trend that today involves terms like ‘digital dragons’ and ‘unicorns’.

Topics such as the invasion of Ukraine, inflation or Polski Ład (New Deal) are trending in Poland. And the rise in popularity of flexible working is also affecting companies in Poland’s second city.

Krakow is a romantic medieval city. Today the city is ranked 1st in the Business Friendly Cities 2021 organized by Forbes (among cities from 300 to 999 thousand residents). The city also ranks higher than any other Polish city (including Warsaw) in the Tholons Global Innovation Index 2021. Coming in at 20.

It is no surprise that technology is becoming an increasingly important part of the city’s success. Technology companies, technology talent and now even Fintech start-ups.

Unicorns show faith in Krakow

Some of the most attractive employers today belong to the elite club of start-ups familiarly referred to as ‘Unicorns’. To join the club, you just need to be worth at least $1 billion, and be a start-up. As of April 2022, there are 1,000 unicorns around the world. And some of these unicorns have decided to open offices in Krakow too:

Revolut, a well-known UK unicorn, was already mentioned in the 2021 report prepared by MOTIFE and ASPIRE. This year’s report explains how further unicorns have come to Krakow. There are now 8 of these tech start-ups with operations in Krakow. KITOPI, SpotOn, Bitpanda, BlockFi, Revolut, project44, Relativity and ZEPZ. 5 of these unicorns are representatives of the successful Fintech industry.

It has taken a lot of work for Krakow to be attractive enough to appeal to the unicorns. This year’s MOTIFE & ASPIRE “2022 Krakow IT Market Report” is also a colossal piece of work. More than 20 tech leaders and ecosystem representatives took part in the creation of the report.

Katarzyna Wysocka, Director of Department for Entrepreneurship & Innovation at Municipality of Krakow shared in the report how: “Krakow is home to an annual international gaming industry event – Digital Dragons – a highly renowned conference and trade show.”

There are many different types of digital dragons already growing their teams in Krakow.

Krakow as a Tech hub

Comarch, Aptiv and Sabre are big technology companies with operations in Krakow for over 20 years. Between them they employ over 5,000 IT specialists today.

But then technology companies started to come to Krakow in larger and larger numbers. Qualtrics, the largest start-up from Utah in the U.S. at the time came to Krakow in 2018:

It was a sign of things to come. Initially the existing companies in Krakow showed concern about competition for IT talent in the market. Today, according to the report, Krakow has a talent pool of 50,000 IT specialists. However, today hybrid and remote working offer more flexibility. Which means there could be a potential talent pool of 300,000 IT specialists for companies working out of Krakow.

Krakow welcomes Ukrainian companies and employees

Poland has welcomed record numbers of Ukrainian refugees. Everybody living in the country has felt the affects of the war, many of the migrants have headed to Krakow.

Andrew Hallam, General Secretary at ASPIRE shared in the report how: “This report is being published at a time when war is raging in Ukraine. Just 150 miles from Ukraine’s western border, Krakow has demonstrated great solidarity with its neighbour, welcoming as many as 150,000 Ukrainians displaced by the war, alongside nearly 60,000 already settled in the city.

“Krakow’s admirable and lightning response to the plight of its neighbours demonstrates the same characteristics that have helped the city emerge – and thrive – as a major global hub for the tech industry.”

Later on the report goes into detail about how there are approximately 200,000 Ukrainian software engineers and IT professionals. How the most visible impact of the war is how companies are looking to find alternative locations outside of Ukraine. Furthermore, companies that were considering Ukraine, Russia, or Belarus as locations to hire or set up operations, are now considering Poland. And perhaps Krakow.

Home office culture in Krakow

According to the report nearly all employees in Krakow (96%) are offered the opportunity of working from home on occasion. Before the pandemic, companies were offering “1 or 2 days of home office per week.”

In a Cushman & Wakefield survey, as many as 45% of respondents indicated they would implement a hybrid model. The survey was undertaken in the Krakow eco-system only. The preferred model for employers surveyed was to offer 3 days of working from home. And 2 days working from the office. None of the firms surveyed would be closing their offices though.

Dominika Kowalska, Associate Workplace Strategy & Change Management at Cushman & Wakefield believes this ‘hybrid’ work model will become the predominant model in many companies in Krakow.

Krakow’s Digital Dragons are ready for further Change

In January many IT specialists in Poland and Krakow were affected by the Polski Ład (New Deal) tax reform. According to the Sedlak & Sedlak 2021 Salary Report – in 2022, companies plan to increase the salary budget for IT specialists by an average of 9%.

A talented IT specialist in Poland is able to double their compensation in 5 years by continuously working on their skills. And changing jobs. Many of them do just that.

The changes for Krakow are felt in other ways too. According to the MOTIFE and ASPIRE report, job advertisements doubled for IT positions in Krakow between Q4 2020 and Q4 2021.

Additionally, new hires for IT and software engineering positions in Krakow increased by 10 – 18% between the start of 2021 and the end of the year.

At least 60% of jobs posted in 2021 offered the option of working remotely (source inhire.io).

73% of IT specialists are passive candidates (source Devire).

And finally, Java remains the most sought after skill amongst employers.

Michal Piatkowski, Co-Founder & CEO at MOTIFE adds in the report how: “The global tectonic changes in the IT labour market are one of the key trends influencing our local ecosystem.”

Krakow’s tech specialists have plenty of opportunity, but they are also learning to embrace change. Digitalisation is constantly forcing change across the entire Polish employment sector. Other sectors and cities can learn a lot from how Krakow is enticing unicorns and welcoming IT companies and specialists.