The latest Carta report, along with Warren Buffett’s significant warning about the stock market valuation exceeding 200% of the US GDP, raises serious concerns about the future of the venture capital (VC) industry.

It’s becoming increasingly evident that the VC industry, as it currently operates, may not endure much longer. This isn’t just about the Carta report’s findings—I actually disagree with their methodology. The J-curve clearly shows that to accurately assess VC returns, one needs a study period of at least 6 years, ideally 8-10 years, to capture the full picture.

However, this discussion is about the foundational principles of the VC industry, which is fundamentally a game of mathematics and numbers—areas where AI increasingly outperforms human capabilities. This technological shift threatens to render traditional VC professionals obsolete.

Moreover, I’m skeptical of the indexed investment approach that has become an industry standard, largely popularized by entities like Y Combinator. This approach has inflated market valuations and attracted participants who lack the necessary skills and resilience to build successful companies. The global innovation ecosystem is now flooded with mediocre entrepreneurs, and the widespread adoption of indexed investing has only exacerbated this problem, leading to its failure for the majority of the VC industry.

Investing in this manner might be easier and less labor-intensive, but who ever said that venture capital should be an easy, high-return industry based on an indexed approach? The truth is, it’s a high-return business only for those who adhere to certain principles:

• Invest in industries where you possess deep expertise.
• Invest where you have a robust global support network.
• Invest where you and your network can add significant value.
• Invest where you can secure the next rounds of investment.
• Invest where you have access to strategic investors and M&A opportunities.

While junior experts might execute indexed investments, the true transformative power of VCs lies in their knowledge, experience, and networks. This is what’s currently missing in the industry.

The proliferation of VCs, driven by an indexed approach, has pushed valuations to unsustainable heights, and we’re now facing the consequences of this ill-considered strategy. Limited partners (LPs) are wary but continue to back the same players who led us into this predicament—a scenario akin to a “Stockholm syndrome” in VC, where money remains tied up with the very causes of its underperformance.

Many VCs have shifted from being true value providers to mere commissioners, and LPs continue to invest in these funds, despite evidence that an indexed approach is ill-suited to the startup world. Unlike capital markets, where companies that reach IPO level have proven success stories, startups often don’t have this track record, making an indexed approach risky and often ineffective.

This is why we founded the Founders Games (www.foundersgames.org) 15 years ago, as a counterpoint to the “indexed approach.” Out of 3,000 to 5,000 growth-stage applications each year, only 12 make it to the finals, representing just 0.2% to 0.3% of all applicants. These numbers underscore the importance of prioritizing value over volume, even at A and B investment rounds. We’ve proven this approach works, with a 15-year track record of success.

The current economic climate may briefly allow indexed investments to succeed due to the decreasing number of startups being founded. But don’t be fooled—the industry requires a complete reset, with a renewed focus on creating true value for both LPs and founders. VCs should not operate like bankers or hedge fund managers, indexing their way through investments. Instead, they need the skills, commitment, and dedication to grow companies from scratch to a potential IPO or M&A, with money being just one of many necessary ingredients.

Key factors for success include:

• Access to top talent worldwide.
• A strong reputation and track record for supporting portfolio companies.
• A deep network within specific industries and among family offices with expertise in those industries.
• A network of industry-specific investors who can participate in subsequent investment rounds.
• Access to data for benchmarking. AI is increasingly turning industry verticals into platform businesses where the winner takes all. Identifying talent is not enough; it’s crucial to ensure that a company has the potential to become the dominant player. The lack of global benchmarking data can lead to misguided investments that might fail when a global market leader enters the scene.

As an LP, I’m acutely aware of these trends and make investment decisions accordingly. As Managing Director of a publicly listed investment company focused on high-growth (A, B rounds) companies, we only invest in a select few winners from the Founders Games. We ensure that we choose the best of the best, who are not only financially successful but also driving social and environmental change. This focus on impact provides an additional layer of security, as impact-driven companies tend to attract more capital when other factors are equal.

Dr. Plamen Russev
LP/VC, Founder Webit Investmet Network (BSE: WIN) 

About Dr. Plamen Russev

Dr. Plamen Russev (www.russev.com) is a seasoned technology and investment expert with over three decades of experience. He is the visionary founder of the Webit global community and events.

Each year, coinciding with the World Economic Forum in Davos, Dr. Russev awards $6 million at the Grand Finale of the Founders Games (www.FoundersGames.org), the world’s most competitive growth-stage program for companies that drive social and environmental impact alongside business success.

Committed to democratizing investments in high-growth impact companies, Dr. Russev publicly listed the Webit Investment Network (WIN). WIN is an evergreen investment company with a Right of First Refusal (ROFR) of up to $6 million to invest in each semi-finalist and finalist of the Founders Games.

Currently, WIN’s portfolio includes six impact-driven companies. It offers a unique opportunity for Limited Partners (LPs) to invest in a global portfolio of top-performing, high-growth companies. Investors benefit from the liquidity provided by the stock exchange and receive dividends from every exit event within the WIN portfolio.

WIN is announcing its next capital increase call in order to invest in the next batch of Founders Games winners. 

Among the portfolio so far are some of the most impactful companies in methane reduction (CH4 Global), the worlds biggest precise pollination company (BeeHero), the leading hearth digital twin company (InHeart), the new material company (Elephant in a Box), the leading 360 degree immersive content company (VUZ), the leader in AI education in Middle East (ISchool).

Президентството на COP28 (на ООН) избра и покани Webit като представителна платформа за глобалния пазар за иновации и растящи компании да представи световните иновации, които да покажат пътя към решаване на климатичните предизвикателства.

Самият форум в Дубай ще завърши със специална Webit церемония GROW@COP, която ще се проведе в официалния конферентен център на Президентството и на която Webit ще обяви пред държавни глави от цял свят топ 5 компании (преминали през петте кръга на Founders Games), които биха добавили огромна стойност в намирането на глобални решения. Webit е основател на световната програма и платформа за иновации Founders Games.

Това признание от най-високо ниво за влиянието ни в иноваците и устойчивото развитие е може би едно от най-значимите в историята на Webit и идва от най-важната световна организация.

Webit Foundation в партньорство с UICCA, водена лично от Шейха Шамма ще бъде домакин на 8 събития в рамките на COP28 на Организацията на Обединените Нации тази година.

Признанието за Webit и Founders Games е и признание и огромна реклама за България.

То е поредното доказателство за въздействието и влиянието, което световнатa Webit общност има и още по-голям стимул за екипът ни да работи и да създава стойност за страната ни и целия свят.

Ето и предстоящите ни събития в рамките на следващите 4 месеца:

⦿ POWERS SUMMIT – ВЛАСТ ЧУВАЙ

Дата: 7 ноември, 2023 | Локация: София Тех Парк

Българският Давос отново ще събере лидерските екипи на парламентарно представените партии, изпълнителната власт и новата регионална власт заедно с бизнеса и обществеността. Повече информация и възможности за спонсорство и участие: https://www.powersummit.eu/

⦿ HEALTH / RELIEF, RECOVERY AND PEACE

Date: December, 3rd: | Location: UICCA Pavillion, Expo City Dubai

⦿ FINANCE / TRADE / GENDER EQUALITY /ACCOUNTABILITY

Date: December, 4th | Location: UICCA Pavillion, Expo City Dubai

⦿ ENERGY, INDUSTRY AND JUST TRANSITION

Date: December, 5th: | Location: UICCA Pavillion, Expo City Dubai

⦿ MULTILEVEL ACTION / URBANIZATION AND BUILTENVIRONMENT / TRANSPORT

Date: December, 6th | Location: UICCA Pavillion, Expo City Dubai

⦿ FOOD, AGRICULTURE AND WATER

Date: December, 8th | Location: UICCA Pavillion, Expo City Dubai

⦿ YOUTH, CHILDREN, EDUCATION AND SKILLS

Date: December, 8th | Location: Youth Pavillion, Expo City Dubai

⦿ NATURE / LAND USE AND OCEANS

Date: December, 9th | Location: UICCA Pavillion, Expo City Dubai

⦿ GROW@COP28 GRAND FINALS GALA CEREMONY

Date: December, 10th | Location: Main Conference Center of COP28 Presidency

⦿ FOUNDERS GAMES GRAND FINALS

Date: 17 January, 2024 | Location: Davos, during WEF

Благодаря на всички за подкрепата през годините! Ние до сега само загрявахме, както се казва. 🙂

Другата новина е, че Аниела Русева поема поста Генерален Директор на събитията Webit по света, за което лично аз и целия екип на Webit и желаем успех.

Аз се фокусирам основно върху нашата инвестиционна дейсност и ще се радвам да видя повече български компании, които да достигат до финалите на Founders Games, за да им помагаме още по ефективно чрез Webit да достигнат до световен успех и разбира се да ги финансираме. Платформата приема апликации за следващия сезон, така че успех: Founders Games

Желая ви здраве и до нови срещи на предстоящия Powers Summit 2023 на 7 ноември в Тех Парк София.

С най-добри пожелания,

Д-р Пламен Русев
Председател | Webit Foundation

Dear friends,
I want to share with you how grateful I am that the result of the efforts of so many partners – policy makers, enterprise leaders, founders, scientists, investors and friends of Webit to continue the dialogue on re:Inventing Europe’s Future in such a positive and impressive manner! 

I will keep this major update as brief as possible and in case of interest to get involved – would be happy to provide you more info.

A few days ago the European Commissioner Digital Agenda and Society Mr. Mariya Gabriel has officially announced the “EU Digital and Innovation Week”. It will take place on 25-29 June 2018 in Sofia, hosting:

• 1500 top EU policy makers – Heads of State, EU Commission , EU Parliament, Ministers
• 5000 business leaders ranging from Fortune 500 top executives to most promising European startup founders 

Webit.Foundation is proud to be part of EU Digital and Innovations Week and of these common efforts on establishing a clear focus on Europe’s digital future and the role of CEE as one of the engines empowering it!

It is a great time for Europe to take advantage of the still untapped potential of CEE for the sake of all Europeans and for the sake of our children, whom we have borrowed our present from!

We have a lot of work to do together and now is about time to do it – latest 25-29 June 2018!

I would be delighted to see you at the 10^th anniversary of Webit.Festival Europe 2018  and to welcome you as one of the impact people who will join us from all around the world.

Here is how you may get involved:

• Call for speakers – apply and join the world first class speakers of Webit.Festival Europe 2018 – one of the most impactful individuals in Europe and the World
• Startup? Apply and get selected among Europe’s top 200 startups. Webit.Foundation shall provide you EVERYTHING for FREE – free expo table, a pitch opportunity on stage and opportunity to get 200 000 EUR cheque! For the past 10 year Webit is committed on supporting the innovation and startup ecosystems in Europe and worldwide and unlike others we DO NOT charge money the people who build the future, but support and provide grants to them! See more online.
• Exhibit and/or become a Sponsor of this unique opportunity in 2018 to connect with all parties involved in shaping the future of Europe – large enterprises, governments, municipalities and the entrepreneurial world.
• Attend and be among the limited number of 7000 people to discuss how to re:Invent Europe’s Future while exploring unparalleled business and social networking.

Lookng forward to meeting you soon – latest in Sofia – The Digital Capital for Webit.Festival Europe and the “EU Digital and Innovations Week”!

A year ago I have been honoured by Varna Free University “Chernorizets Hrabar” with the title Doctor Honoris Causa for my work on boosting the entrepreneurial ecosystem in Bulgaria and building links between Academia and the Industry!

This was one of the most memorable ceremonies in my life and a wonderful and humbling experience! It gave me a chance to reflect on my work during the years as I keep looking towards the future.

The other reasons this honorary title was given to me is my commitment to support the implementation of new and innovative forms of education, providing huge amount of knowledge for the new economy and the fourth industrial revolution and growing the entrepreneurial ecosystem of Bulgaria as well as for his commitment for establishing  Bulgaria as a Digital and Tech hub for CEE.

Since 2008 Webit Foundation created one of the largest online video content libraries of Digital Skills and knowledge, professional trainings and certificates (under the Ministry of Education). We have established a professional training programme with Certification and Diplomas under the brand Webit eAcademy by the National Agency for Vocational Education and Training (NAVET).

Webit is still committed to creating happiness and empowering the entrepreneurism as a driver to improve the state of the world (please read this article published by World Economic Forum). We believe that happiness is where people are successful while staying together with their family and friends.  

I am confident that the right education is one of the keys to achieving this goal. With such passion and vision for the future the Varna Free University is looking at its next decade of success in building more prepared people for the future!

You can watch my public lecture during the official award ceremony here:

Part I:

Part II:

My text about the Intelligent Specialization of Central and Eastern Europe published by the World Economic Forum.

The future of Europe is at stake, and the reasons extend far beyond obvious challenges such as the migration crisis and the political turbulence that led to Brexit.

For the last 12 years, the European Union’s share of global GDP has fallen from nearly 32% to only about 23%. Although it is difficult to imagine the continent again becoming the center of global manufacturing, the EU still has the tools to reverse this trend. We can take advantage of the Fourth Industrial Revolution – a wave of digital-era change – and push the region to a period of sustained growth, through a combination of long-term policies, innovation and cooperation between governments and businesses.

Central and Eastern Europe has the potential to play a very substantial role in the continent’s future. For the last five years, the region registered an impressive growth in Information Communication Technology (ICT) as a share of its GDP (in Bulgaria, for instance, it rose from 1.3% in 2012 to 3.3% in 2016).

Instead of competing within the region’s smaller markets, we can create targeted intelligent specialization, drawing on existing areas of expertise as well as creating new new ones. This way one country’s industry will be able to expand into the broader European market, without having to compete within the region.

Poland’s startup scene

Just a quick look at the Central and Eastern Europe’s investment market will show you that Poland has a very well developed start-up ecosystem in a number of sectors, but with substantial value concentrated in marketing automation. Тhere is already one unicorn, Allegro, and two more potentially on the way, in SALESmanago and Growbots. Meanwhile, the video gaming industry boasts CD Projekt. These are two of the most promising verticals with established know-how and success in today’s Poland.

Meanwhile, Czech Republic and Romania have become real pillars of European cyber security, with startups such as Avast Software, Bitdefender and TypingDNA, while my home country Bulgaria already has its own ICT success in the software development company Telerik, that was acquired by Progress Software for $262.5 million in 2014.

In Slovakia, the advanced engineering company AeroMobil is developing the world’s first flying car and is expecting to start taking orders this year.

Further fostering these areas of strength, supporting them with focused education and talents from within the region would make a huge difference both locally and for the future of Europe.

With a more in-depth study I am convinced that we can easily make a list of several specifications for each country and create strategies for regional development.

The fourth industrial revolution and its new technologies are going to be the guiding light on our path to a better future.

Luxembourg to Albania

But industrial and economic innovation can’t be achieved without the needed legislation and government support. Just as Luxembourg has become the first country in the world with laws regulating the mining for resources in space, and Estonia was the first country that introduced electronic citizenship, we have to think about the right legislation to support the digital development of CEE. One possible example comes from Albania, where startups have the opportunity to launch with zero taxes until a certain amount of revenue has been established.

We also need clear specialization from early the early school years to prepare our children for the needs of the future labour market.

Nowadays very few people benefit from their knowledge of physics and chemistry. And teaching our children to code (as is becoming mainstream) is the same as training them to drive a cab – it is a skill that will not help them find a job after automation reaches its full potential.

We need to rebuild our education systems so as to inspire critical thinking, creativity and teamwork, because this will be the skill that the future industry will demand the most.

Achieving economic transformation of this magnitude will require not only legislative initiatives, but also state support in the form of subsidies and reduction of the administrative burden on the new businesses.

Advanced technology startups in Europe are on the rise and now more than ever we need to support and invest in them, because this will be an investment in our common future. It can happen through new platforms for public-private partnership and targeted acceleration with government’s support.

In many aspects the industry of Central and Eastern Europe is still stuck in the Soviet age. In recent years governments in the region talk more and more about the re-industrialisation of their countries. But instead of pouring money into new manufacturing capacity, states should support their brightest minds with more efficient programs for seed and next-round investments.

Intelligent specialization should be reflected in the region’s education systems as well as in its legislative frameworks. I sincerely believe that Central and Eastern Europe can empower a better future for the old continent. I believe in the human potential of this region that remains untapped. For me, our countries have a future that is much brighter than being among the top outsourcing destinations. And with joint efforts of policy makers, academics and business leaders, we can draw this future together.

What are the 10 things that will bring the biggest changes in people’s lives over the next 10 years?

The Digital Transformation affects every aspect of our lives, but in my opinion, over the next 10 years, the 10 biggest changes will happen in Healthcare, Virtual Reality, Computational Power, Hyperconnectivity, knowledge of the world around us, 3D Printing, Transport, Blockchain, Artificial Intelligence and Food.

1. Healthcare

Today, Healthcare is inefficient, bureaucratic and expensive. This is a multi-trillion dollar industry, so what better field to change? Thousands of startup companies, along with giants, such as Google, IBM, Apple, Samsung and many others are entering this industry and will fundamentally change the way people are treated today. And this will lead to a much better, more effective and cheaper Healthcare.

Healthcare will be the most transformed field of all in the next 10 years and the changes will be enormous. That is why I will pay special attention on them in this text.

Robot surgeons will make perfect operations without human error at a price of several dollars! Nanorobots, the biometrics of wearable devices, Big Data, translational medicine (the transfer of knowledge from fundamental sciences into clinical practice) and Artificial Intelligence create the conditions for a breakthrough in the treatment of cancer. Using them, we will be able to detect cancer at a very early stage, and the removal of cancer cells will be done with ever greater precision. Reducing the size of nanorobots will allow them to reach places that were inaccessible or too delicate for conventional surgical instruments. Personalized Healthcare will become a standard over the next 10 years to pave the way for the next step in the coming decade when stem cell pharmacies will be widespread in the future.

Just like the Human Genome Project that made the cost of reading the genome of each one of us just a $1000 and cutted the timing to just a few hours, the simulation of the human brain will too become possible. The exponential growth in the computing speed will make it possible to form accurate models of every part of the human brain. At present, only individual regions of the brain are studied in detail. But after 10 years scientists will be able to combine all areas and make a real-time simulation. Again, like the Human Genome Project, many scientists say this will not be possible, but they miss the exponential growth of computing speeds of computers. The development of nanobots for medical needs and simulation of the brain will lead to a huge change in Healthcare and will make a number of diseases, that are considered deadly, fully treatable within 10 years.

Another major driver of change in Healthcare is the 3D Printing. Instead of ink, the 3D printers print with materials – polymers or metals, overlaying a layer onto a layer and creating a volume. Nowadays, parts that are used to build body implants are being printed, but the development of technology will allow the production of personalized organs. Instead of polymers, the printer puts layer after layer of cells placed with a precision of micrometer distance. After 10 years, fully functioning  complex organs, developed with a stock of enough nutrients, oxygen and growth potential to survive will be reality.

After that moment, although some organs (the not too complicated ones) will still be upgraded, they will be replaceable with printed ones. In the coming decades, more and more of the 78 organs in the human body will be printable. And instead of waiting for years for transplant, the patients will be able to get the personalized organs they need.

The implanted printed organs will allow the insertion of sensors in them, which will monitor the status of both the organ itself and the entire organism. This will lead to highly personalized healthcare, better prevention and treatment.

 

2. Virtual Reality

The emergence of screens, first on TV, then on computers for the last 20 years and last on phones and mobile devices for the last 10 years, changed our entire lives. Do you remember you life before the mobile phone? Do you remember how the communication looked like then, just 10 years ago? How did you search for information, how did you connect with people?

Imagine those screens disappearing!

In 10 years, they will all be replaced by something that you wear on your eyes – glasses, viewers and depending on the technological advances maybe lenses. In front of our eyes we will have a whole new reality – a combination of the real, surrounding world and virtual reality. Few months ago Microsoft demonstrated its technology and platform Hololens, which allows a person’s presence simulation that can physically be anywhere as long as there is a network connection.

Meanwhile, the first apps have come. You can now have dinosaurs in the house, or watch a movie or a football match in your living room in the company of the actors themselves.

This is happening today!

The billions of dollars invested by Facebook in Oculus, by Google in Magic Leap, by Sony in  Qualcomm, and many others, already gave their first products. Within few years, wearing glasses and viewers that create virtual reality will be standard, and the fashion industry will be struggling to impose this new trend. This in turn will lead to other changes. And now technology helps people with physical disabilities write by watching their eyes while choosing a letter from a virtual keyboard instead of pressing the letter with a finger. This technology will evolve and, in combination with the instrument that I have showed in several TV programmes for following of brain activity, will bring a new connectivity between the man and the machine. Although not very accurate at the beginning, with the necessary technology we will be able to send a SMS, call a friend or turn on and off the lights, music, or dimming the windows at home.

 

3. Computational power
   

Imagine being able to buy a brain for €1000. After 10 years the computers will be able to make the same amount of operations as our brain – 10 trillion cycles per second. This exponential growth will lead to changes in every part of the human development and the lives of everyone.

4. Hyperconnectivity

In 2026 new 5 billion people will be connected to the web. This was  the whole population of planet Earth in 1987. In 2000 the total number of Internet users was only 740 million. In 2015 the ITU data showed that their number had grown to 3.2 billion. The new billions of connected people will come mostly from Africa and Asia and their connection will be mobile.

8 billion people who exchange thoughts, business, art, research, finance and more online! Those people will be quick with the presence of Google, Amazon, Facebook, VR, Big Data and 3D Printing.

These are huge markets and entirely new economic reality, which is already happening and within ten years will almost completely replace the names of the 500 companies on Fortune’s list. Google (Project Loon), Facebook (Internet.org), SpaceX, Virgin (One Web) and many others are developing their projects for accessible internet for every person on the planet. At the end of last year, the Egyptian government allowed and then suspended Facebook’s service Internet.org and people familiar with the motives say that not the creation monopoly prerequisites (created by such services), but the lack of the options to trace the users is the thing that led to the suspension of the project. Anyway, adding 5 billion people to the 3 billion that are already connected will create a new business and social reality and that is inevitable!

 

5. Knowledge of the world around us

If the knowledge about everything that is going on on Planet Earth, every detail about the wind in Sahara, the growth of the grass in Mongolia, the birth of an elephant in Masai Mara and trillions of other events per second, as well as structuring, studying and analyzing this information push us closer to the perfect knowledge, then by 2026 we will have the perfect knowledge about everything that is happening in our world. Internet of Things (IoT) or the broader Internet of Everything (IoE) describes a system of connected people, devices and data.

In its predictions the giant Cisco expects IoE to generate $19 trillion. In 10 years there will be over 100 billion connected devices – the telephones and computers are already connected and they have number of cameras, biometric devices etc. The drones, satellites, cameras and sensors in the private and public transport are getting more and more.

In the near future cars, houses, refrigerators, bulbs, stoves, shoes, clothes and new screens will become a part of the connected devices arong with the billions of industrial ones on Earth, the Atmosphere and in Space. Assuming that each connected device has several sensors, camera, detectors for temperature, pressure, touch and others, we can estimate that by 2026 there will be over 300-500 billion connected devices.

They will give us information about everything that happens somewhere on the planet with a millimeter accurancy and a dynamic and structured information about the changes it is going through.

6. 3D Printing

3D Printing emerged in the mid-eighties of the last century, but only in 2014 was the breakthrough in which 3D Printing became faster than mold casting (traditional production). Print speed continues to increase, doubling every two years, in a model that is similar to Moore’s Law. By 2026 it is expected to be 32 times faster. So the detail that now takes 4 hours to print in 2026 will take just 7 minutes.

Today, 3D printers can create everything from a miniature figure to car and even a house. With the development of materials and speed, in 2026 we will print our clothes, accessories, some organs, household items and more. This will make the low-skilled labour in tailoring factories and plants unnecessary!

 

7. Transport

Transport is a field, in which changes are extremely noticeable. Not long ago Tesla announced more than 130 000 orders for its Model 3 at a $35 0000 price. The model will be on the market later this year. These are over $4 billion for a car, which is still basically a prototype that nobody has seen yet, except from the stage it was presented. This car is an electric vehicle that incorporates huge number of sensors for proximity, location, cameras for traffic conditions and more. It is also a car with an integrated autopilot. In other words, a car in which the driver can be replaced by a computer. And this is happening.

After 10 years, the percentage of cars without drivers will be significant and will grow annually. Whole industries will be changed – the transport of people and goods with trucks, busses and taxis. In a decade millions of people around the world will have to reorient and look for a new livelihood.

If the Hyperloop project, which is a tube system in which a capsule full of people or goods moves in a vacuum environment, is developing as planned, the first hyperloops will soon emerge in America, Europe and the Middle East.

8. Blockchain

You may not have heard about Blockchain (Blockchain’s founder is among the speakers at Webit.Festival Europe in Sofia), but I guess you have information about bitcoin. If you want to stay up-to-date, I highly recommend you to get acquainted with the matter. Bitcoin is an extremely secure cryptocurrency that is based on Blockchain. Based on that technology, it is safe to transfer money, shared, contracts and any kind of information without an involvement of an intermediary (banks). Personal data may be stored and to be the foundation of your personal identification (instead of the serial number of your passport or an electronic signature), medical records and information etc. Blockchain is an innovation and a protocol that democratizes economic relationships and creates prerequisites for the preservation and protection of personal data and space.

9. Artificial Intelligence

After the victory of IBM’s DeepBlue over Gary Kasparov in 1996 the sceptics said that chess has a rather predictable strategy and the computer can never beat a human in the Chinese game Go, which is tens of times more complex and requires human intuition to be won. In other words, the game is something like a super, mega, hyper chess! Not long ago, one of the living legends of the game, winner of 18 world titles Lee Sedol was defeated in 4 out of 5 games by a machine. Now Google’s AlphaGo computer is the new proud bearer of the “divine” Ninth dan!

If you are using Siri and Google Talk today and think it is convenient, then wait for another 2-3 years and see how it will evolve and will answer more complex questions. In 10 years artificial intelligence will be an integral part of our lives – we will give it access to our conversations, our emails. It will monitor our health, advise us on what clothes to year, depending on the time and agenda we have for the day. It will tell us what to eat, how to care for ourselves, how much and how to practice sports, drive our cars and much more.

10. Food

The increasing population, development of technology, climate change, reduction and depletion of resources, including the vital for the human race – water, lead to changes in the way people grow their food. The so-called vertical farms are already gaining momentum as prototypes and development models. While there is still no commercially successful model in the required scale, vertical farms are climate-independent vertical systems in which climate, light, humidity and other important factors are controlled by humans, producing the output at a height of separate layers (floors) like a vertical greenhouse – skyscraper.

Scientists and environmentalists defend the thesis that vertical farms create conditions for a greener farming than the traditional agriculture. Either way, genetically modified foods will inevitably become part of people’s diet, because the demand is much greater than supply.

Climate change will make many areas unsuitable for growing crops and animals that have been traditional in certain places, and this will exacerbate food shortages. In this sense, technology will provide solutions as cited above.

 

To summarize I can say that we live in a time that never happened before in the human history and there is no equivalent or historical lessons to learn from. The powerful combination of digitalization and globalization that we are witnessing changes our lives every single day.

All of the 10 major changes listed above and many others, related to space, biotechnology, energy, etc. will mutually induce their potential and the changes will become more and more rapid.

The future will be the way we make it. People can live happy and enjoyable life while robots perform dangerous and harmful activities. More and more often, in our technology industry, we hear voices about minimum income of every person that guarantees the basic needs and standard of living. Although a few years ago this was perceived as an utopia, more and more scientists, technology investors, entrepreneurs and economists are thinking and working on the topic today.

I am writing this text and sharing my thoughts and knowledge, because I believe that I am helping people in Bulgaria. Because I am convinced that only trained people can create the future and live in it happily. The global events and communities of Webit, the business I invest in, and the consultations we make for large businesses about their digital transformation and collaboration with startup communities for innovation are part of this mission – to create people ready for the future – the future, in which life will be better.

Inevitably, changes will affect everyone. If someone is thinking that his life or his work will continue the same way is profoundly mislead. That is why it is especially important that everyone is ready to adapt and take advantage of the opportunities that are being discovered and are about to be discovered.

Above all, never stop learning! Before us are the opportunities for humanity to develop for better and better opportunities for Bulgaria as a state and a nation!

 

 

The future of Europe is at stake, and the reasons therefore extend far beyond the obvious problems of the continent, such as migration crisis and political turbulence that led to the exit of Britain from the European Union.

To avoid the failure of the European project that led to the longest period of peace and prosperity on the continent, we must remember the principles that underpin Europe’s role as the center of Western civilization and the engine of world economic development.

As the former President of Estonia stated, Europe is now a second tier player not only to America, but also to China and India. And although it is difficult to imagine the continent again becoming the center of the world manufacturing, we can take advantage of the potential of the Fourth industrial revolution and push the region to a period of sustained growth, achieved through a combination of well though long-term policies, innovation and cooperation between governments and businesses.

For the last 12 years European Union’s percentage of the global GDP has fallen from nearly 32% to only about 23%. But the EU still has the tools to reverse this negative trend, as long as it starts using the full potential of its member states and neighbours and expand their economic capabilities in the best possible way, while maximizing the human capital.

I think CEE region may play a very substantial role in this empowerment of Europe’s future and that the path to this passes through a process, that I call intelligent specialization of Central and Eastern Europe. Europe has a very defragmented digital market, international relations and cooperation models. But united, the CEE region itself is a big enough market to boost the development of its bright minds and businesses which may further empower a better future for the whole continent.

It is time to launch a wide-ranging conversation about the specialization of each CEE country’s digital economy, based on its strengths and qualified staff capacity. Just a few decades ago many countries in Central and Eastern Europe were part of the so-called Council for Mutual Economic Assistance (COMECON) – an organization for planned industrialization and exchange of goods and resources within the former socialist bloc.

While supporters of the free market oppose the existence of such organizations and identify them as protectionist, on the other side are the likes of Elon Musk and others who started discussions around Universal Basic Income. Obviously the economic model needs changing. Even the most vocal libertarians could not deny that the real economic consolidation of Europe can’t be achieved without smart planning and at least partial distribution of activities within EU.

This time we don’t have to limit our cooperation with the borders of political unions and to build new iron curtains, that hinder our development. On the contrary, now is the time to start the process of integration of the Western Balkans and the former Soviet republics who have ambitions to join the European single market. Because the integration of CEE countries outside of EU and building unicorns within Europe is great for the whole continent.

Many entrepreneurs from the former Yugoslavia countries and from Ukraine have established entities in Bulgaria. They are not only supporting the development of ICT and tech as a whole in the country, but also for the overall economic integration of the region.

With this kind of platform, we are creating a market and added value for ourselves, while boosting Europe’s entrepreneurship ecosystem and most importantly – the countries of the region may stop competing for the anyway limited VC activity and investments in the region.

All this may sound too ambitious, but my longtime experience as an investor and serial entrepreneur has shown me that there is no such thing as being too visionary.

CEE tech sector

In 2014, the European Union had a little over 46 000 enterprises in the high-tech manufacturing sector, which represent 0.2% of the total number of enterprises in the EU. High-tech manufacturers were most numerous in Germany (8 827), the United Kingdom (6 504), Italy (5 453), Poland (3 461), the Czech Republic (3 339) and France (3 178), together accounting for almost 67% of the high-tech sector in the EU-28.

Мost of the countries in CEE region lag behind their western allies. But for the last five years countries like Bulgaria registered an impressive growth in the percentage of ICT in national GDP (from 1.3% in 2012 to 3.3% in 2016). During this period the region witnessed overall economic growth, due to EU fund investment in infrastructure and development. Still, with targeted efforts for the technology sector in CEE it can further generate growth and accelerate integration.

Not restriction, but empowerment

Instead of competing within CEE’s smaller markets, limited human potential and education, we can create targeted intelligent specialization, based on the already available talents and abilities and build new. This way one country’s industry will be able to expand on the broader European market, without having to compete within the region.

Starting this process doesn’t mean that if the top level policy makers decide that one country should specialize in specific industrial field, all the others must shut down all their businesses, that can compete with it, or that this country should not develop other industries. This concept only touches on the new digital economy verticals, not on mining for coal for example.

Just a quick look at the CEE’s investment market will show you that Poland has a very well developed startup ecosystem with a number of verticals but substantial value concentrated in marketing automation with one unicorn and two more on the way (SALESmanago and Growbots) and the video gaming industry (CD Projekt) – two of the most promising verticals with obviously most know-how and success in today’s Poland.

Czech Republic and Romania have become real pillars of European cyber security with startups, such as Avast Software, Bitdefender and TypingDNA, while my home country Bulgaria already have its own ICT success in the software development company Telerik, that was acquired by Progress Software for $262.5 million in 2014.

In Slovakia the advanced engineering company AeroMobil is developing a flying car and mobility solutions.

Fostering further these areas of strength, supporting them with focused education and talents from within the region would make a huge difference for the region and further for the future of Europe.

With a more in-depth study of the markets in CEE I am convinced that we can easily make a list of several specifications for each country and create strategies for the regional development.

Building the future around happiness

Why happiness is important? I believe that our common goal must be to create not only successful, but also happy people in Europe and to work on this a lot for CEE. As a person who spend a number of years abroad working to achieve my dreams, I have learned to make a difference between success and happiness. With equal other factors, success is biggest where the density of opportunities is higher. I can tell you that there is no bigger motivation to pursue success, than to change the lives of the people you love first, your community second and next to your country, your continent and the world. The closer you are to your family while achieving success – the higher possibility to be happy! As being close to your family and friends is a factor for happiness.

The higher density of opportunities we manage to create within CEE the more people shall be both successful and happy in their own countries.

The fourth industrial revolution and the new technologies are going to be the guiding light on our path to a better future.

Although we all see how the robots are becoming our competitors, I believe the ability to create a such a competition is the humankind divine mission, that will help us become better as a species. Hopefully this will help us stop destroying the nature, polluting the air and water and killing each other. It will help us discover the infinite universe, that we represent as human beings and help us walk more confidently on the road to happiness and peace.

Europe has not only the economic power, but also the civilizational basis to be the leader of this process, as long as it decides to go on the road to happiness and return the faith in the positives of multiculturalism among its citizens. This can help us stop looking for the differences between us and see each other as competitors but instead to embrace all Central and Eastern Europeans as partners.

We are the only ones that set the limits within which our talents can freely migrate. With the idea for intelligent specialisation and the power of modern transport and communications we can put an end of the brain-drain of CEE and allow the qualified professionals from the region to remain close to their loved ones.

Economic transformation through smart legislation

But industrial and economic innovation can’t be achieved without the needed legislation and government support. Just as Luxembourg has become the first country in the world with laws, regulating the mining for resources in space, and Estonia was the first country that introduced electronic citizenship, we have to think about the right legislation to support the digital development of CEE.

Another good example for this is Albania, where startups have the opportunity to launch with zero taxes until a certain amount of revenue has been established.

During this year’s Webit.Festival we have the ambition to bring together political, academic and business leaders from CEE and beyond to an open and visionary discussion about the ways CEE can help and boost itself to create added value. The Digital Economy Leadership Summit of the event will once again become a platform for presenting the best ideas for the future of Europe with a focus on CEE region.

With the right amount of political will and initiative, within a horizon of 5 to 7 years this type of collaboration can completely change our legislation and education.

New Education Doctrine

Without a clear specialization from the early school we can’t prepare our children for the needs of the future labour market.

Nowadays very few people benefit from their knowledge of physics and chemistry. And teaching our children to code (as it is becoming mainstream currently) is same as training them to drive a cab – it is a skill that will not help them find a job after the automation reaches its full potential.

We need to rebuild our education systems so as to inspire critical thinking, creativity and teamwork, because this will be the skill that the future industry will demand the most.

Targeted digital economy acceleration

Achieving economic transformation of this magnitude will require not only legislative initiatives, but also state support in the form of subsidies and reduction of the administrative burden on the new businesses.

The advanced technology startups in Europe are on the rise and now more than ever we need to support and invest in them, because this will be an investment in our common future. It can happen through new platforms for public-private partnership and targeted acceleration with government’s support.

In many aspects the industry of Central and Eastern Europe is still stuck in Soviet age. In recent years governments in the region talk more and more about re-industrialisation of their countries. But instead of pouring money into new manufacturing capacity, states may support their brightest minds with more in numbers and way more efficient programs for seed and next round investments. This way governments will get bigger control on their economy, while in the same time help for creating new jobs with high added value.

At Webit.Foundation we are already committed for the past 8 years on playing a role in developing of the startup ecosystem in Europe and other regions of the world. Over 2000 startups from Europe apply annually for the Webit’s Founders Games to get the chance to become part of a global community of over 100 000 people. Further to that our events in Istanbul, Dubai, Singapore and India also get a total of 8000 applications.

Our foundation grants between $1 and $1.5 million per year to startups in the form of exhibition space, tickets for our events, travel, marketing and PR. Moreover, on every festival we are giving an award between €200 000 and €500 000.

In conclusion – if specialised in non-competitive way in the new digital and tech domains, the Central and Eastern European countries will empower the growth of the regions while building a better future of Europe!

The Intelligent Specialisation of each CEE country shall further reflect the education doctrine in the regions as well as the legislative framework. The newly created highly focused and talent empowered startups shall further add value to both talent growth and attraction. I sincerely believe that Central and Eastern Europe can empower a better future of the Old continent. I believe in the human potential of this region, that remains untapped. For me, our countries have a future, that is much brighter than to be among the top outsourcing destinations. And with joint efforts of policy makers, academics and business leaders, we can draw this future together.

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Dr. Plamen Russev, Executive Chairman of Webit.Foundation

Dr. Plamen Russev is a serial entrepreneur with proven record in developing business ventures in multicultural and challenging business environments, investors and philanthropist.  He is also Executive Chairman of Webit.Foundation. He invests in tech companies and has special interests and experience in Impact Investments in Healthcare, AI, IoT, eSports, VR and Real Estates. Mr. Russev is awarded by Financial Times, Google, Republica and Visegrad Fund among the 100 New Europe Innovators, Doctor Honoris Causa of VFU.