How we cee it. – April 2025 Digest
This is the monthly recap.The real action happens weekly — subscribe to How we cee it. Week 14 CEE Startups Outpace Europe in Growth. Fintech, Transport, Energy Dominate…
This is the monthly recap.
The real action happens weekly — subscribe to How we cee it.
Week 14
CEE Startups Outpace Europe in Growth. Fintech, Transport, Energy Dominate Funding
Business intelligence firm Dealroom has released its 2025 analysis of Central and Eastern Europe’s (CEE) startup ecosystem.
Here are the key takeaways:
Over the past decade, the region has evolved from a fragmented, undercapitalized landscape—largely dependent on government and EU funding—into a dynamic innovation hub with a strong talent pool. The rise of companies like UiPath, Rohlik, Bolt, Vinted, and Pipedrive has validated CEE’s potential, attracting global VCs such as Sequoia and a16z.
In 2024, venture capital firms raised €1.3 billion for CEE startups, with 76 VC-backed exits—the highest number on record.
To date, 57 unicorns have emerged from the CEE region, including six in the past year: Prague-founded MEWS, Kyiv-based Creation, Minsk-founded Flo, Kyiv-founded Rentberry, Krakow-based Diagnostika, and Poland’s Eleven Labs.
Following a boom period, the years 2023, and 2024 brought a sharp decline in funding and deal activity driven by market volatility, rising interest rates, and investor caution. A persistent lack of growth-stage capital continues to hinder the scaling of global category leaders.
In 2021, tech stocks surged, and several public CEE unicorns reached high valuations, which were partly corrected later. By 2024, the CEE ecosystem was valued at €243B
Over the last decade, CEE’s startup ecosystem has outpaced the European average in growth. In 2024, Transportation, Fintech, and Energy were the most funded sectors. SaaS remains dominant, while Hardware has gained traction in recent years.
Amid shifting security dynamics following Russia’s aggression, defense and dual-use startups in CEE have grown significantly, backed by targeted investments, military upgrades, and regional cooperation.
Today, over 100 such startups are based in CEE, many of which are active in Ukraine—most still in the early stages.
EU Picked 40+ Strategic Projects to Secure Raw Materials
The European Commission has approved 47 Strategic Projects under the Critical Raw Materials Act (CRMA), aiming to reduce Europe’s reliance on third countries for essential inputs like lithium, rare earths, and magnesium.
The CRMA, first introduced in 2023, sets ambitious targets: by 2030, 10% of the EU’s annual consumption of strategic raw materials should come from domestic extraction, 40% from processing, and 25% from recycling. Right now, the EU relies heavily on China for many of these inputs, especially in industries like electric vehicles, defense, semiconductors, and renewables.
Finnish Mehiläinen Group Bets Big on Balkan Healthcare
In one of the region’s biggest healthcare transactions, Finland’s Mehiläinen Group, backed by CVC Capital Partners, has acquired Romania’s Regina Maria and Serbia’s MediGroup in a deal worth around €1.3 billion. The acquisition gives Mehiläinen, a major Nordic player, a serious presence in CEE. Regina Maria serves nearly 1 million patients and 13,000 corporate clients, while MediGroup runs over 100 clinics in Serbia. Together, they generated €550 million in revenue last year.
Week 15
The Trump Effect: Market Turmoil Reaches European Stocks
Donald Trump unleashed a wave of chaotic tariffs on the entire world last week—sparing Russia, Belarus, and North Korea—and sent global stocks tumbling. Not even European equities were spared.
The European Union was hit with 20% across-the-board tariffs, with many countries struggling with additional 25% steel, aluminum, or car tariffs. Many other countries got an even worse deal.
The news sent the U.S. stocks sharply downward, with the S&P 500 index shedding over 12% in a week, hitting its lowest close in almost a year on Tuesday. Even the most stable companies, like Apple, saw their market caps drop by a fifth.
What happens on American markets may feel distant here in CEE, but the reality is that many people have their savings parked in U.S. index funds.
And the downturn hasn’t stayed stateside. European investors had been celebrating a steady climb in local equities over the past month—but the party didn’t last.
The Prague PX index dropped over 6% since April 2, the Warsaw WIG20 index slid 8.7%, the German DAX index shed a staggering 9.4%, while Romania (RON), Baltics (OMX Baltic10), and Hungary (BUX), tumbled 2.9%, 4%, and 4.5% respectively.
The pan-European index Stoxx 600 fell over 9.3 percent since tariffs were announced.
Bizarrely, the Warsaw Stock Exchange even paused trading for an hour on Monday during the selloff—at the risk that the exchange system would not be able to handle the number of orders.
Volkswagen, Europe’s largest automaker, has declined more than 8% since April 2, hitting a six-month low. VW plays a critical role in the economies of Slovakia, Hungary, Czechia, and Poland.
Stocks rebounded briefly on Tuesday, fueled by hopes that the U.S. administration might strike deals with some of the affected countries. However, according to analysts, a mild bounce doesn’t mean the worst is over—further declines could be just around the corner.
Optimism was already short-lived in the US markets after Trump signaled he was ready to slap 104% tariffs on China.
EU Pushes for Zero Tariffs, CEE Holds Its Breath
Ursula von der Leyen, president of the European Commission, said on Monday that the EU would be willing to employ a “zero-for-zero” approach on products, including cars, eliminating tariffs on the goods if the United States did the same.
Elon Musk, the billionaire adviser to the U.S. president, has supported the initiative.
Alongside offering a peace deal, the EU officials are also cooking up retaliatory tariffs to hit back at the United States if the two sides cannot reach a deal.
For Slovakia, Hungary, and the Czech Republic, this is more than a diplomatic scuffle. With economies heavily tied to car exports, CEE stands to lose the most if the EU- U.S. trade tensions escalate.
U.S. Considers Pulling Troops from Eastern Europe
Donald Trump is reportedly weighing a withdrawal of up to 10,000 U.S. troops from Eastern Europe. This could unsettle regional security just as tensions with Russia persist. Troops stationed in countries like Romania and Poland were originally deployed as a deterrent force following Russia’s invasion of Ukraine. While the Pentagon reviews the proposal, NATO allies are on edge. U.S. European Command chief General Christopher Cavoli has advised against the drawdown, warning it could undermine the current fragile balance in the region.
Week 16
Poland’s Donald Tusk Wants to Polonize the Economy
“Poland, Europe, and the entire world are in a situation where it must be said loudly and clearly: we must survive—for ourselves and for the state,” stated the head of the Polish government, Donald Tusk, on Tuesday, at a European Forum for New Ideas conference in Warsaw.
Mr. Tusk emphasized that, under current conditions in the world, the repolonization of the economy is essential. “If we want to achieve economic success and build a secure state, we must be clear: Poland will not be a naive partner in the increasingly ruthless global competition among egoists—whether in markets or on the fronts of wars. Polish companies will not be left at a disadvantage against international giants,” he declared.
Tusk proclaimed “the end of this naive globalization.” He added, “I take this brutal message upon myself—it’s time to rebuild the national economy, to repolonize the Polish economy, market, and capital.”
The Prime Minister stressed that Polish companies must play a leading role in projects crucial to the national economy.
As an example, he pointed to the investment in the Sławków Terminal, a logistics hub located at the westernmost end of the broad-gauge railway line, which will be developed exclusively by Polish firms.
“We have made a decision: the development of this site and its investments will be supervised entirely by us—Poles, Polish companies, the Polish state. And we will profit from it,” Tusk announced.
Another flagship project is the construction of a nuclear power plant. “We have decided that the PLN 53 billion (€12.3 billion) allocated for building the first nuclear power plant will go to Polish companies working on the project,” he stated.
Tusk reiterated remarks he made in February during a speech at the Warsaw Stock Exchange, emphasizing that 2025 will mark a turning point for investment, protection, and development of Polish businesses, as well as for deregulation.
Banks Boost Impact Projects Across CEE
In Poland, ING Bank Śląski kicked off the 7th edition of its grant program for startups and scientists, offering PLN 1 million (€0.23 million) in funding. This year’s theme centers on urban well-being—from public infrastructure to mental health and accessible living spaces. Winners will get financial support, mentoring, and access to ING’s innovation ecosystem.
In Latvia, the Accelerate2Move 2025 program has opened applications for mobility-focused startups working on smart, green transport solutions across Europe.
UniCredit Bank Romania has partnered with the European Bank for Reconstruction and Development (EBRD) to introduce new financial tools in Romania. This will make UniCredit able to lend more money to local businesses. Additionally, UniCredit promises to invest about €93 million into environmentally friendly projects.
Slovakia’s Supercomputer Plan Escapes Collapse—But Questions Remain
Slovakia’s “supercomputer” project Perún, part of the national Recovery Plan, was nearly scrapped after delays and political friction. On Tuesday, the Slovak Minister of Informatisation, Samuel Migal, announced that the project is back in play and will be finished shortly.
Originally tied to Tachyum, a Slovak-founded chip company with a poor delivery track record, to power the computer, the project was stalled. Moreover, suspicious and strange bureaucratic nearly suffocated the venture.
In the end, Tachyum was dropped as supplier, and a new launch is tentatively planned, though details remain fuzzy.
Week 17
Details of NATO’s Target Changes Emerge
If a NATO member is attacked and Article 5 is invoked, the Czech Republic may need to commit its entire standing army to support it. Before, only a single mechanized brigade was demanded.
This example is just one of several changes expected to be brought by the NATO summit this June.
Significant investments will be required. According to experts familiar with the proposed targets, a country like the Czech Army will need to increase personnel and equipment by at least 30%.
To meet rising expectations, NATO is also likely to raise the defense spending benchmark from 2% to at least 3% of GDP.
The European arms industry could benefit from this shift.
For now, the U.S. remains the dominant global arms supplier, including across Central and Eastern Europe, where militaries rely heavily on American F-16 and F-35 fighter jets, Patriot systems, and Abrams tanks. But amid growing concerns over U.S. control of exported weapons, European countries are rethinking procurement strategies.
This shift is reflected in the proposed €150 billion SAFE Fund, which would allow EU countries to borrow for arms purchases, with a strong preference for equipment made in Europe and developed by firms with “design authority” based in the EU.
Signs of renewed momentum in the European defense industry are already visible. Germany’s Rheinmetall, for example, has announced new ammunition plants in Lithuania and Germany.
Investment in defense tech innovation has also surged in Europe, reaching $5.2 billion in 2024, five times higher than six years ago and 2.5 times more than in the past two years.
According to analysts, the EU has a critical seven-year window to scale, modernize, and expand its defense production. Years of underinvestment have left many European arms manufacturers stagnating. Progress is further slowed by the fact that most NATO members still don’t view long-term defense spending as essential. The exceptions: the U.S., Poland, and the Baltics.
Sanctioned Dodik “Siphoned” Public Funds, Now He Wants to Channel Lithium
Milorad Dodik, the controversial leader of Republika Srpska—a constituent republic of Bosnia and Herzegovina—confirmed in an interview that he has proposed a $100 billion deal to U.S. President Donald Trump, offering American companies the opportunity to mine lithium and other minerals.
According to Dodik, Viktor Orbán’s regime would also be somehow involved in the deal, although details are lacking.
The proposal is rather bizarre, given that Dodik is currently under U.S. sanctions. “Members of this network, which include Dodik’s adult children, facilitate Dodik’s ongoing corruption in Bosnia and Herzegovina’s Republika Srpska, allowing him to siphon public funds from the Republika Srpska and enrich himself and his family at the expense of the citizens of Bosnia and Herzegovina, and functional governance in the country,” wrote the U.S. Department of the Treasury’s Office of Foreign Assets Control in 2023.
As the Schwarze Null Ends, CEE Gains Close to Zero
Germany may be trying to stimulate its sluggish economy through looser fiscal policy, but the ripple effects are unlikely to reach much of Central and Eastern Europe. According to S&P Global, Berlin’s fiscal push will barely register beyond its borders, contributing just 0.1 percentage point to Germany’s growth in 2025.
Whatever modest benefits a recovering German economy might bring are likely to be offset by U.S. tariffs on EU exports, which could shave 0.4 to 0.6 percentage points off GDP in CEE economies such as Poland, Hungary, and Czechia. Hungary is particularly exposed, with its 2025 growth forecast slashed from 3.0% to 1.5%.
Week 18
Romania Leads CEE Investments, Poland’s Diagnostyka Joins Unicorn Ranks
European startups raised $13.9 billion in the first quarter of 2025, with investment up 2% year-on-year, according to data collected by Dealroom.
A gambling company based in Bucharest, Romania, secured the largest funding round. Sportsbet raised €1.3 billion in growth equity VC funding in February this year — a type of investment that helps more mature startups expand faster.
It became the only CEE company to make it into Europe’s top 10 venture capital rounds. Following Sportsbet was the London-based Google DeepMind spinout Isomorphic Labs, Malta-based private jet membership service Vistajet, and medical training tools company Amboss from Germany.
Among CEE countries, Romania, Estonia, and Poland had the highest total amount of venture capital invested in their companies in Q1.
Outside the CEE region, most VC funding flowed into startups based in the UK, Germany, and France.
Europe passed the 600 mark for the number of unicorns this quarter, adding six new startups with $1 billion valuations. One of them came from our region: the Polish healthcare company Diagnostyka.
Austria’s Two-Speed Economy – STRABAG Builds Momentum, Austrian Airlines Faces Headwinds
Austria’s business sector is moving at two very different speeds. While construction giant STRABAG just posted its highest net income ever at €828 million in 2024, national carrier Austrian Airlines is sinking deeper into financial trouble, with a quarterly loss exceeding €100 million.
For STRABAG, the Central and Eastern Europe region remains critical. Its South + East segment, which includes Austria and most CEE countries, accounted for 41% of group revenue last year. Major infrastructure investments in Poland, Czech Republic, and Slovakia helped push the company to record results, though operations in Hungary faced pressure due to withheld EU funds and declining public sector activity.
Meanwhile, Austrian Airlines continues to struggle with high costs, strikes, and reduced demand. One key factor: Vienna Airport’s elevated departure fees, which make the carrier less competitive in the region compared to CEE peers.
IMF Slashes CEE Region’s GDP Forecast for 2025 Amid Trade War
The International Monetary Fund has lowered its 2025 GDP forecasts for the CEE region due to global trade disruptions. Poland’s forecast was cut to 3.2% (from 3.5%), Czechia to 1.6% (from 2.3%), and Slovakia to 1.3% (from 1.9%), while Hungary and Romania saw downgrades by more than one percent to 1.4% (from 2.9%) and 1.6% (from 3.3%), respectively. Previous estimates were made before Trump’s presidency began.
In 2026, Poland is set to slow modestly but remain the CEE’s fastest-growing economy, while others are expected to accelerate.
Inflation forecasts worsened amid tariff concerns: Hungary 4.9%, Romania 4.6%, Poland 4.3%, Czechia 2.5%, and Slovakia 3.7%, with most easing slightly in 2026 but remaining above targets.
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