Support Programs for Startup Companies in Hungary
This article deals with both governmental and non-governmental support to startup companies in Hungary. Special focus is also paid to the mitigation of COVID-19 pandemic.
1. Governmental support of the startups
The startups in Hungary have various opportunities to obtain help from either Government or other funds. In the conditions of Hungary, works one organization called Young Entrepreneurs Association Hungary (Fiatal Vállalkozók Országos Szövetsége or FIVOSZ). FIVOSZ provides information related to both governmental and private opportunities either on its website or on events organised by them. (https://fivosz.hu/bemutatkozunk/?english-page)
Its goal is to provide help to the following generation of entrepreneurs with creating an entrepreneurial layer who is able to run companies successfully in the long term. Based on those ideas, they have built the Association and nowadays they focus on helping other young people to develop their business hand in hand with providing an opportunity to communicate with each other.
Another provider of public opportunities is without any doubt Design Terminal (https://designterminal.org/about-us/).
It is a non-profit organization and it deals with management of business and cultural issues. It is run mostly by the state and private grants. Design Terminal cooperates mostly with the Ministry of Human Resources (Emberi Erőforrások Minisztériuma) which is part of the Hungarian government. Moreover, the part of its duties represents the publication of annual and documented financial reports.
One of the most important organizations which provide support to rising companies are in the conditions of Hungary and especially Budapest, the National Research, Development and Innovation Office (Nemzeti Kutatási, Fejlesztési és Innovációs Hivatal, https://nkfih.gov.hu/palyazoknak). Its goal is to build creative framework for the cooperation of the national startup ecosystem and provide support to perspective companies, especially through funding and mentoring.
One of its latest idea is project called Covidea. It represents a startup contest with budget consisting approximately of 120 million HUF and it is also supported by the Ministry for Innovation and Technology. The main target of this project is to mitigate the effect of COVID-19 pandemic and to do so through finding possible solutions in social and health area. According to available information, 29 project proposals and 5 project ideas have been granted yet in this contest. Successfully funded projects have for instance included an autonomous indoor disinfection robot, COVID-19 diagnostics development, the improvement of a distance learning and testing system for clinical studies, an online learning system for learning at home.
2. Private support of the startups
There are also other opportunities from the sections of private projects, counting for instance Startup Leadership & Management. (https://www.meetup.com/Startup-Leadership-Management/) It provides clients help with gathering workshops at one place on regular basis together with finding the solutions of actual problems concerning startup community.
One of the recent projects is called ‘MVM Edison Light Up!’ (MVM Magyar Villamos Művek Zrt. Edison – Light Up, https://mvmedison.hu/#palyazati-felhivas) a progressive contest which provides opportunities for startups in their starting phase. One of its projects is Startup Academy which serves as an incubator for perspective startups. It focuses mainly on network industries, counting energetic and creative modernizations with deeper collective impact.
Another program providing support with foundation of enterprises of younger people is the “Enter the market!” programme (“Lépj piacra!” program, https://ofa.hu/lepj-a-piacra). The origin is connected with National Employment Public Non-Profit Limited Association (Országos Foglalkoztatási Alapítvány Nkft, OFA) which helped with its founding. As we mentioned, it focuses mostly on younger people under age of 35 with special focus on persons between 25-30 without a college education and persons between 30-35 with college degree.
The ‘Enter the market!’ program (‘Lépj piacra!’ program) is implemented by the National Employment Public Non-Profit Limited Association (Országos Foglalkoztatási Alapítvány Nkft, OFA) and supports the business creation of young people under 35 (people between 25-30 without a tertiary education and people between 30-35 with tertiary education) in two stages, following the same method as the above mentioned Youth entrepreneurship programmes. The lectors are providing help connected mainly with e-learning and acquiring experience about setting up their own business. Help can be provided also with preparation of business plan and further mentoring. After successful completion of training, the startups become eligible to receive up to 2 million HUF as a support.
Recent events have showed us that without governmental or private support to the startup companies we could experience dramatical rise of collapsed projects as many enterprises do not have any reserve fund as they are still in the growing phase. Nevertheless, with support of those companies we could prevent further negative effects to both startup environment and society.
If you have any question regarding this topic, do not hesitate to contact us!
dr. Dobos István attorney at law / Ján Mrázik – Faculty of Law of Comenius University
Phone / Whatsapp: +36303088151