EL NORMAL | COLUMN | 16. 10. 2025
From engineering hatchery to global unicorns
Written by: Luka Renko
Slovenian companies have a very different genesis — from old companies that have survived the transition and craft workshops to the first private companies at the end of the 1980s to modern startups after 2000. In this diversity, strong product verticals have been formed: automotive, electrical engineering, pharmacy and information technology. All of them are based on strong engineering departments that develop products for the global market. Although this is rarely exposed in the media, we create global solutions and strengthen high-paying jobs. The question is whether we are ready to upgrade the ambition with which we have already achieved global successes into a vision that will take Slovenia forward.
I started my career as a student at HERMES Softlab, founded in 1990 by four computer engineers. For many years, the company has been synonymous with software engineering and has been developing solutions for the international market. At its peak, it employed 850 mostly engineers and managers. We ensured rapid growth by hiring foreigners, as we had colleagues from 43 countries in our teams. Although we produced globally leading products, most of them were developed for foreign companies (so-called outsourcing), so we did not own intellectual property. After the acquisition by Comtrade in 2008, this engineering and product potential was successfully transformed into stand-alone product stories (HYCU, Comtrade Gaming...), which together with the sale of some parts of the company increased the value of the entire company. This culture of engineering performance and performance at the highest level has been the hatchery of good engineers and managers who later started their entrepreneurial paths or participated in the biggest stories in the IT field.
Experience in developing complex products, leading large teams and experience of rapid growth led me to the story of Outfit7. The founders conceived the company with the goal: to generate enough capital to sell and invest in the next project. After a few attempts, in 2010 they got on the right track with the Talking Tom app. The company with ten employees had multi-million dollar revenues and high profits in half a year. The ambition quickly became bigger: to build an internationally recognized brand in the field of entertainment. Everything was subordinated to this: a huge investment in the protection of brands and intellectual property, and the construction of a culture and team capable of performing at the highest level. Here, too, we had to supplement the teams with foreigners, because in our country there was no serious creative production at the world level (art director, animators, illustrators...). When the company was sold for a billion dollars in 2017, all employees participated in the success. This was made possible by a stock options program that turned all associates into co-owners.
In recent years, due to acquisitions of technology startups, Slovenia has also acquired some key development centers of global unicorns, which successfully operate and manage global functions from Slovenia (Klika in Sportradar, Zemanta in Teads, Bitstamp in Robinhood, Cleanshelf in SAP...). While we read in the media about the relocation of sales offices, here we have development departments with hundreds of engineers who provide high-paying jobs and work experience in the most demanding international markets. Part of the capital from these acquisitions has been funneled back to startups through venture capital funds. All these companies are building an ecosystem that allows for further development and new breakthrough stories.
Slovenia boasts a very good engineering staff as well as other specialties. Successful past stories generate new generations of entrepreneurs and leaders who, based on their experience, enter new challenges more decisively. Although we are still well behind some countries in the region, ambitions are slowly growing.
The entrepreneurial environment is interdependent on a good supportive environment created by the state, and unfortunately we do not have such encouraging signals. Unfortunately, since the first corporate boom after independence, our system has been greatly complicated by additional regulation and burdens. In the politicians and decision-makers who should create the conditions for growth, I see a great lack of vision. In the past, we have united around independence, joining the EU and NATO and adopting the euro, but since then we have no vision of what we want to become, we do not set goals and we have no serious intentions to achieve them.
I want clear objectives and improvements in three areas: de-burdening the middle class, simplifying all public services and serious changes in education.
1. Relief of the middle layer:The middle class is overburdened, mainly with upward unlimited social contributions and income tax. As a result, it is the engineering and management personnel who are the drivers of the growth of the economy that are the most stressed. An additional problem is the unfavorable tax treatment of stock options for employees, which makes them almost useless in practice, although they are a key mechanism for motivating and attracting the best global talent. While the prevailing opinion in the media is that people with an above-average salary are “rich”, on the other hand, they are those who live on capital and pay only minimal contributions. We know a whole bunch of detours on how to avoid excessive payroll taxes. It is imperative that we reach an agreement to significantly relieve the burden of work, simplify the system and abolish all detours and remnants of the past.
2. Simplification of public services:Since independence, the entire public service system has been overhauled — procedures (e.g. recruitment of foreigners) take an unpredictably long time. With each legislative amendment, only new obligations and restrictions are often added. My suggestion is: with each amendment to the law, the proponent must make at least three simplifications in the law. Instead of resorting to subsidies and exemptions, make the system easy, clear and predictable for everyone. For all public administration services, we must finally implement targeted and measurable user experience improvement.
3. Education:We need to seriously talk about the skills that are missing in our education: financial literacy, computer thinking, group and project work. The university must allow a truly multidisciplinary study based on examples from abroad. Education is not only a competition for the number of hours in individual subjects, but above all the education of curious and creative people who set goals in life and also pursue them.
Entrepreneurs are willing to take risks, but with the state we need a partner, not a bureaucratic obstacle. It is time to back up our engineering strength and ambition with a clear vision — so that Slovenia can become the best environment for the best global products.
Luka Renko
Column and Image Source: http://www.elnormal.si (Image: Unicorn resting in garden; From Unicorn Tapestry Series, 1495-1505. The tapestry is kept by the Metropolitan Museum in New York.)
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