Krakow, Poland: A Technology Hub for Central & Eastern Europe

1. Krakow, Poland:A Technology Hub for Central & Eastern Europe • Ramon Tancinco • Chairman, High Tech Committee: American Chamber of Commerce Poland • Head of Strategy Central and Eastern Europe: Cisco Systems Version as of 28 May 2010 THIS WORK IS LICENSED UNDER THE CREATIVE COMMONS ATTRIBUTION-SHARE ALIKE 3.0 UNITED STATES LICENSE.

2. Agenda • Speaker Intro • Krakow Primer • Krakow by the Numbers • Krakow Trends

4. Who is in Krakow? • Multinational R&D: Google, IBM, Motorola, ABB, SABRE, Delphi, Fujitsu • Offshore BPO: CapGemini, IBM, Motorola, Shell, ACS, Fortis Bank, UBS, Comarch, Unicredito Bank, Tesco, International Paper, HSBC, Lufthansa, State Street, HCL, Philip Morris, Hewitt, Alexander Mann, Hitachi, Accounting Plaza, EDF Energy, UPM-Kymenne • IT Services: concentrations in video game design and development, web design and development, mobile applications, bioinformatics, and other areas • Startups such as iLoopMobile, Volantis, Synkia, X-Formation, Test4Load, PipeJump, and many others • R&D Headquarters for Small and Medium-Sized Companies from Ireland, Israel, UK, Denmark, Norway, and US

5. Why Krakow? • Large technical/engineering talent pool • Low cost + stability of European Union • Multilingual, educated work force • Great place to live: Beauty, culture, and recreation

6. Krakow Multinational Employment

7. Kraków – employment in Major IT Companies and SSC (ITO)

8. Student numbers – Kraków and Katowice - (one labour region) Katowice, located very close to Krakow, create one labour makro region with the highest no. of students in Poland, with min. 2,5 times higher students potential compared to Poznań Source: National Statistics Office

9. Growing population in KrakówPositive net migration by region – Krakow on 2nd position in Poland (number per 1000 inhabitants)

10. 1998 1994 2002 2004 2005 2006 2007 1996 1992 2000 1989 2002 2006 2005 1998 2004 2007 Krakow’s Transformation into an R&D Center IBM Launches their Software R&D Laboratory in Krakow Sabre reaches 340 Engineers 2000:Sabre purchases Gradient 2002: IBM Buys PwC’s Finance BPO Operations Motorola Office Opened in Krakow at Jagiellonian Campus Tower RafalStyczen sets up IIF, the first Venture Capital fund in Krakow Poland joins the European Union Sabre reaches 100 Engineers Google Opens their first and only Central and Eastern European R&D Center in Krakow Sabre reached 600 Engineers Poland emerges from Communism

11. Trend Snapshot: The Krakow Mobile Cluster • Motorola • EricPol • Google (Android) • Volantis • iLoop Mobile

12. Trend Snapshot: International Start-up Back-Office R&D (last 2 years) • Synkia (Norway) • X-Formation (Denmark) • iLoop Mobile (USA) • Test4Load (Israel) • PipeJump (USA)

13. Krakow success stories • Google • “For years, Western technology firms have come to Eastern Europe to lure away talented computer-science graduates...but now, the region's universities are producing so many top programmers that many firms are changing tack – and setting up shop at the source. IBM, Motorola, and Google have all opened research labs here in Krakow in recent years. • Eastern Europeans have dominated international programming competitions in recent years, attracting the attention of tech firms. "When we saw these trends, of people from Eastern Europe winning these contests, we decided to take a closer look," says KannanPashupathy, Google's head of international engineering operations. "People have a huge interest in software, and there's a much deeper grounding in mathematics in the curriculum in these countries"...Cultural, geographic, and economic proximity to Western Europe has given the region an advantage over global competitors like India.” (Christian Science Monitor, “Why Google put a research lab in Poland”, 3/13/07) • IBM • “For Big Blue and other IT services companies, Poland's skilled workforce makes up for rising wages with skills that offset Bangalore's low costs. Krakow, Poland, is a nice place to live and work, with a charming old quarter and a lively club scene driven by the city's population of more than 150,000 students. In fact, Krakow seems almost too nice to compete with the raucous, traffic-jammed cities of India as a location for outsourcing... • Since 2002, IBM has boosted staff in Krakow tenfold...Part of the reason Krakow makes sense for IBM, as well as for Cap Gemini, Motorola, KPMG, and other multinationals is that the university town churns out a steady supply of well-qualified graduates.”(Spiegel Online, “As Good as Bangalore: Why Krakow Still Works for IBM”, 9/26/07) • CapGemini • Provides support in 25 different languages. “Krakow has a rich history, but today’s city has a modern face with the kind of infrastructure you’d expect from any European commercial hub...Importantly, it gives us access to the skills we need – 180,000 graduates (30,000 from Krakow) leave Poland’s universities every year.”(“Krakow Centre of Excellence”, CapGemini)

14. Krakow, a university city • 200,000+ students in higher education • 400,000+ students within 100 km • Over 30,000 new graduates each year. • ~8,000 IT sciences students; ~5,000 mechanical engineers currently enrolled • Leading universities in the country • Jagiellonian University, AGH University of Science and Technology, Krakow University of Technology, Krakow University of Economics, and others. • 8 universities in Krakow with IT degrees SOURCE: TESTHR.PL, CAPGEMINI

15. Krakow culture and lifestyle • “Eastern Europe’s new bohemian capital” (New York Times) • EU Capital of Culture 2000; “considered by many the cultural capital of Poland”. • Entire Old Town is a UNESCO World Heritage Site. • With 7 million+ visitors per year, convenient transportation links and infrastructure. • 7 national parks within 200 km; world-class skiing 100 km away.

16. Support for investments • EU subsidies for service sector job creation • Polish government support • Direct aid for R&D and BPO job creation • Corporate and real estate tax exemptions • Poland has a large and growing economy: ranked #21 in global GDP, low inflation.

17. Krakow/San Francisco SISTER CITIES, AS OF JULY 2009