Phoenixes, dragons and wolves. Meet 100 digital champions who are building digital economy in Central and Eastern Europe

The Digital Champions CEE ranking has been developed on the basis of transparent and up-to-date data based on strict financial criteria. The leaders are ranked based not only on EBITDA, but primarily on capitalization, and the majority of the champion's revenue must come from digital products and services or those sold through digital channels. Specialized platforms Dealroom, Merger Market and Pitchbook, as well as more than 40 Private Equity and VC funds, provided the data for the ranking. The ranking presents digital champions in three categories, based on their value:

- With the use of so many reliable sources, with such broad support of the private equity and VC market, we have created the first such a comprehensive, reliable and objective ranking in the market. In this way, we want to show to investors not only in Poland, but most of all in different parts of the world that our region is full of interesting and valuable companies – emphasizes Piotr Mieczkowski, Managing Director of the Digital Poland Foundation.

The leader of the region in terms of both the number of digital champions as well as their value is Poland - it is a home of 45 companies with a total valuation of nearly USD 43 billion. These include such brands as Allegro, InPost, CDProjekt, Techland or Wirtualna Polska. Furthermore, in terms of the number of champions, Poland leads in each of the six categories of the ranking: from e-commerce to media and entertainment, Saas, fintech, digital infrastructure and cybersecurity.

Romania comes in second with 6 champions valued at USD 31 billion, including the company with the highest valuation in the whole ranking - UiPath. The third place goes to Estonia, whose technological leaders are valued at nearly USD 20 billion, more than half of which consists of the value of Wise and Bolt fintechs.

The next three positions in terms of the value of their champions are held by the Czech Republic ( USD 16 billion), with companies such as Avast, Eurowag and Rohlik, Lithuania (nearly USD 7 billion), from where such companies as Vinted or Citibee originate, and Hungary (USD 5 billion) with companies that include LogMein and or Netrisk.

The highest value, more than USD 100 billion, is attributed to Digital Phoenixes established between 1997 and 2011, half of which are companies founded between 2002 and 2006. It was during these years that such brands as Allegro, Pracuj.pl, CD Projekt, InPost, Vinted, UiPath and Mail.cz - the most famous Phoenixes from the Digital Champions CEE list - were created. The lowest share - only 2% of the ranking value - is held by the youngest companies, which were established within the last four years. So far, there is only one Phoenix among them - Firefly Aerospace from Ukraine.

- In 2021, the Central and Eastern European region will be able to identify rising stars and provide them with the seed capital to help them grow faster. The CEE region still represents only a fraction of the European venture capital market, which was worth EUR 49 billion in the first half of 2021. We still lag behind countries such as Germany or the UK both in terms of invested capital and the number of unicorn companies. This may change faster than we think - comments Annemarie Dalka, investment director of PFR Ventures fund.

In total, the largest number of Digital Phoenixes comes from Poland (10), followed by the Czech Republic (7), Estonia (4) and Romania (3). The next four positions go to Croatia, Latvia, Lithuania and Ukraine (2 Digital Phoenixes each). Bulgaria, Hungary, Slovakia and Slovenia each have 1 company with a value exceeding USD 1 billion. Only Serbia cannot yet claim to have a company in this category. On the other hand, the country with the highest digitalisation rate and thus the highest number of digital champions per 100 thousand population is Estonia, followed by Romania, Lithuania and Latvia. Poland, as the largest country in the region, ranks only 5th in this respect.

- The Old Continent today is a market where large technology companies (with a valuation of more than USD 1 billion) grow the fastest and it has overtaken China in this respect. At the same time, the region of Central and Eastern Europe has recorded the largest growth in this respect over the last 10 years. This is demonstrated by the following indicators: a decade ago, there was one company here with a valuation over USD 1 billion, now there are 30 - emphasizes Tomasz Czechowicz, founder and managing partner of MCI Capital.

The pandemic has turned out to be a driving force for digital transformation, strongly increasing the importance of digital solutions and the speed of digitization in pretty much every industry. With the coronavirus, companies have no turning back - if they want to survive and grow, they need to implement digitalization processes, and digitalization is currently the most important component of the economic policy. Digital Champions CEE is to serve not only the promotion of the region, but also to be a platform for the exchange of experiences between individual countries.

- The "Digital Champions CEE TOP100" ranking perfectly demonstrates that in terms of digital economy development the Central and Eastern European region has made a digital leap over the past two decades. The value of the 100 digital leaders included in the report, which today exceeds USD 130 billion, has increased more than tenfold over the last decade alone. The structure of the ranking, however, reflects the economic conditions of the region, where innovators and entrepreneurs were primarily addressing the needs of local consumers, which facilitated the development of regional e-commerce leaders and the visible dominance of this category. However, the growing number of media, Saas and fintech companies, followed by rising valuations and the interest of global investors in the region, indicates the enormous potential of CEE. However, in order to get to the next level, in addition to assets (e.g. highly qualified software developers), there is also a need for resolute thinking in terms of global expansion and customer needs from the very beginning of business setup, as well as greater cooperation. Today, successful strategies that allow for rapid business scaling are built by creating ecosystems and partnerships, not just based on one's own resources. In this area a positive role can also be played by already mature business, open to cooperation with digital transformation leaders, whether already present on the list of Digital Champions CEE, or those who aspire to it - Magdalena Jończak, VP, Strategy and Transformation, UPC Poland.

Partners of Digital Poland Foundation in the project include: Arthur D. Little (ADL), Daftcode, MCI Capital, PFR Ventures and UPC Poland (Liberty Global).

Digital Poland Foundation was established in order to integrate businesses and the society. It promotes knowledge on the role of innovation and digitization in the economic development of the country. It brings together companies and organizations from different industries, encouraging them to cooperate on specific projects. The mission of the Foundation is to position Poland as a leading center of digital innovation in the world. By promoting international and intersectoral initiative, joining forces, topics and creating a network of contacts and relationships it drives companies to make the transition from offline to online. Digital Poland Foundation invites to cooperation all who are interested in implementing innovative projects that will modernize the Polish economy.