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Krakow's mini-boom in IT attracts Polish and foreign techies

Some 70 multinational firms have opened, employing 20,000 skilled workers – Poles and foreigners alike – in Krakow, which some call a small Silicon Valley of Central Europe.

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The Krakow setting is key to drawing “people smarter than us that [keep] the company growing … and improving, says Mr. Burkot.

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“It’s all city, city, city,” says Ramon Tancinco, head of strategy and business development in central Europe for Cisco. He spent two years on a team deciding where to locate the office, and landed on Krakow. “We look at regions not countries, and Krakow is at an East-West corridor and in a stable EU country. When you bake in the student population, that’s very strong.”

Indeed, the area is low income and high education – some 400,000 students live in the corridor between Krakow and Wroclaw – giving it a dense population base that overseas firms call “sustainable advantage.” And the city’s old square with its 11th and 14th century churches and charms and endless cafes are not lost on firms. For example, Kazimierz, the old Jewish quarter made famous in the film Schindler’s List, is rid of its postwar thuggish character and is a cultural center.

The city’s international draw, too, is key, says Elaine Barnes, a senior manager at Element14. “We need 23 languages in one city. English is the business language, German is No. 2. We looked at Hungary and Finland, Sweden, and Poland. The Czech Republic. We couldn’t find the breadth of language anywhere else [but Krakow].”

The ferment of brain gain among European youth and IT wonks and mavens may be in the air. Yet – like visiting any school classroom to “see” education – it is often difficult to instantly quantify something as amorphous as “brain gain” taking place.

Google’s Burkot suggests that brain gain is “incremental in Poland.”

His colleague Tancinco thinks he sees it, though. “The empirical evidence of gain in Krakow is that when I came here four years ago there was one venture capitalist. Now there are six or seven. That is a barometer. Venture capitalists need to see a talent pool of emerging firms with good ideas or they won’t come. You need to see an incubation, a pool of start ups to be the next ‘whatever.’ ”

And, another plus for Krakow’s continued boom is that hasn’t recorded the corporate horror stories heard nearby out of Ukraine or Russia. There is less mafia and corruption. “Go east of here and it is a wilder ride,” says one analyst.

“There is no support for gangsters here, I’ve never been shaken down or been told to give a bribe,” says Richard Lucas, a British citizen who owns 11 companies in Krakow and has been here 21 years.

One bit of learning gained by Mr. Wasilewski, who moved from Warsaw (Poles may seek work overseas but are often reticent to move internally) to Krakow, is about practice. He assumed there was a set of general rules applicable everywhere in the industry he works. But he found out differently.

The US firm he worked for in Warsaw stressed getting jobs done simply. “They wanted us not to make work complicated by adding structure, but to be efficient and nice to the customer. The focus on being direct and pleasant was a big thing to learn,” he says. “That was new."

“But they have a different way of resolving client problems than the European firm I work with now. The Americans wanted me to be a buffer, to dissolve problems. But this European firm wants client problems reported directly to the front line. They say, ‘put us in direct touch, don’t filter.’”

Tancinco from Cisco suggests that Krakow’s advantages are growing geometrically as hires from abroad accumulate here. The bulk of new hires “spent time overseas,” he says, and they add breadth to local know-how and an intangible element that allows them to be effective in a multinational company.

“With a broader perspective, you learn to work around problems, not to take ‘no,’ or to treat petty issues as final … [whereas] working around problems is more difficult if you don’t have a broader view.”

He adds a caveat: “What I haven’t yet seen are professors starting companies. At MIT, everyone has a side business. In Poland, it is still either-or, business or classroom. Silicon Valley is all about ‘And.’"

“But this may change. We’ll see.”

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