Energy without fuel

Donor dependency exposed

For years, international donor agencies—most notably USAID and the EU—played a key role in nurturing Kosovo’s startup community. This winter, the sudden suspension of USAID operations, which saw the closure of 17 active projects worth over US$156 million, sent shockwaves throughout the economy. Swiss EP partner organizations, which also relied on donor funding, were not spared.

Without a national agency stepping in to help bridge the financing gap, most local incubators and accelerators lost their operating budgets. Promised grants, training programs, and export support initiatives were cancelled almost overnight. The crisis starkly revealed the inherent vulnerability of an ecosystem overly reliant on donor funding—projects often prioritized company registration rather than ensuring sustainable growth and local capacity building.

Government efforts fall short

The Kosovo government introduced different initiatives over the past few years directed at the startup ecosystem. Our team has supported most of these efforts either with our own engagement or through our experts. Unfortunately, most initiatives leave much to be expected. For example, a fund dedicated to the ICT sector was launched in early 2025, but its broad eligibility criteria meant that only three startups benefited from it. Clearly, the one-size-fits-all approach fails to address the unique needs of nascent startups compared to established SMEs.

Additionally, an Innovation Strategy is under development, led by the Ministry of Industry, Entrepreneurship, and Trade (MINT), with backing from Lux Development and contributions from Swiss EP. However, without decisive, actionable steps, implementation remains a distant hope for entrepreneurs who continue to await meaningful policies, funding opportunities, and a reliable support infrastructure.

Glints of hope and energy

Despite setbacks at the high level, a few grassroots organizations continue to support startups and push forward. Notable examples are Makerspace Innovation Center from Prizren and HiSpace located in Pristina.

HiSpace is funded by Heimerer College as part of its student incubation initiative. In spring 2025, they hosted Kosovo's first healthtech hackathon. Participating teams had a rare opportunity to access labs and hospitals to test their ideas. Also, they enjoyed quality business mentoring and coaching. Swiss EP supported the effort with three experts: Jamie Reynolds (pitching), Krzysztof Szyszkiewicz (pricing), and Anne Ulvestad (product development).

Jamie Reynolds shared his excitement:

This weekend wasn’t just about hacks. It was about community, capability, and belief. It’s been an honour to coach these founders and help turn problems into products.

Meanwhile, Makerspace ran the "Idea to Scale" program, providing mentoring and support services to 18 startups to help them turn their ideas into scalable products. The efforts of Makerspace are even more remarkable when considering that they are bootstrapping their operations.

Arber Kryeziu, co-founder of Makerspace, explains the team’s motivation to keep going:

Running programs in Kosovo’s startup ecosystem is not always easy, resources are there, but challenges are constant. Beyond funding, one of the hardest parts is building an entrepreneurial mindset and encouraging young people to take risks in a culture that often values security over experimentation. Still, we keep going because we know it’s the right thing to do. Every program, every founder supported, is an investment in a future where entrepreneurship will drive opportunities and long-term change.

In a further effort to support the ecosystem, Swiss EP is facilitating collaborative initiatives among remaining stakeholders. A promising example is a partnership with the Keiretsu Forum SEE (the only officially recognized angel group in Kosovo) and Makerspace to host a joint pre-acceleration program this autumn. With the call for applications now open, there is hope that this initiative will offer emerging founders the momentum they need.

A Mixed Picture

Despite the lack of institutionalized support and struggles with funding in the country, startup founders in Kosovo continue to demonstrate remarkable resilience. In the first semester of 2025 alone, startups supported by Swiss EP in Kosovo have generated 1204 jobs, and they keep on expanding their operations.

However, company growth driven solely by the passion and hard work of these founders can only go so far. Without the introduction of sustainable financial instruments, robust support programs, and coherent government policies, the risk of further stagnation looms large. The continued exodus of local companies to countries like Albania, where stronger support structures already exist, would be a blow not only to individual entrepreneurs but also to Kosovo's position in the global tech race.

The energy of startup founders is evident in Kosovo. However, it needs fuel to leap forward.