Three decades after the fall of Communism, a new generation of entrepreneurs prepares to take the lead of many major businesses in Romania. The founding fathers of the Romanian capitalism, who started their businesses in the 1990s, began to pass their companies to their heirs.
Romania had almost no business elite and no business education in 1989, when the Communism collapsed paving the way for a new kind of economy – a more inclusive one and opened to new talents.
Many Romanians remember the 1990s as a troubled and unpleasant period, a “savage capitalism” with very few regulations in place and a lot of corruption.
But this is generally a good period for business creation even in a country with low attraction to entrepreneurship like Romania.
In fact, the first business elite was a mixture of self-educated entrepreneurs, of well-connected ex-Communist state-owned managers and of ex-Securitate members.
Among them, many failed in business in the long term but among those who survived at the top, many succeeded to create big businesses.
Now, many of those businesses are in a transition phase, according to a EY report.
“In Romania, many of the family firms have reached the transition from the first to the second generation, and the average of those who succeed in the transition is higher in Romania than the global average, according to our estimates,” said Alexandru Lupea, an EY Romania partner.
“At the same time, it is important to notice that the younger generation adopts the new technologies more easily, many of the emerging firms being from technology-related fields, which require lower investment in the first phase,” she added.
According to a recent PKF Finconta analysis, family affairs demonstrate their value in time thanks to the creation of an agile culture that cultivates innovation and rewards unconventional thinking.
However, business founders have to be aware of a few key-actions in order to ensure a successful transition to the next generation of leaders: to educate the successors at the most renowned and reputable schools, to Ccultivate a working environment where the mistake is not penalized but rewarded when it is aimed at improving processes, to organize joint working teams, and take care of the apprenticeship of heirs within the company.