U.S. tech firm to open a new design and development hub in Prague

The Czech Republic is becoming increasingly attractive to foreign investors. The country’s thriving IT community is making the country’s major cities prize locations for international tech firms, while a history of manufacturing excellence is raising interest from foreign providers of innovative production solutions.

An influx of major foreign investments has been seen over recent months, with the latest a new design and development hub in Prague announced by U.S.-based cybersecurity firm TruU. A $2.5 million investment over a space of two years is intended to boost the company’s access to local cybersecurity talent, accelerate product development and enhance TruU's presence in Europe.

Like other investments announced in the Czech technology sector in recent months, such as SentinelOne’s huge CZK 1 billion move to establish a new innovation center in Prague employing 300 people, TruU’s new hub will create exciting job opportunities for Czech-based tech engineers and data scientists.

But what makes Prague, and the Czech Republic as a whole, such an attractive investment destination for foreign tech companies? In a statement, TruU Chief Executive Lucas Budman provided some clues as to why international companies are so keen on the Czech capital.

“The startup scene is thriving, the city is close to all major European and West Asian markets, and the time zone can support customers and team members in Canada and Singapore with equal ease,” he said.

The location of the Czech Republic, then, is a major bonus for global businesses. Situated at the heart of Europe, employees in Prague can provide an invaluable link between operations in markets to the west and east. This may also be an important consideration for foreign capital investors driving the success of local startups. In late October, Czech company Rossum secured investment of around CZK 2.2 billion, the third-highest amount ever received by a Czech startup, from venture capital firms in the U.S. and Great Britain alongside a Czech investor.

Another factor which makes the Czech Republic attractive for foreign investment is a powerful incentive scheme which can include tax relief, job-creation grants, training grants and other forms of aid. Organizations such as CzechInvest meanwhile play a key role in facilitating and guiding investments.

As of 2019, the largest share of foreign direct investment into the Czech Republic was in the area of finance and insurance activities (31.5 percent), while second place was claimed by the manufacturing sector (28.3 percent). This is unsurprising giving the strength of the Czech automotive industry; indeed, a business delegation from Taiwan recently underlined the potential which the Czech Republic is believed to hold for foreign producers of innovative manufacturing technologies.

But in the wake of the Covid pandemic, the Czech Republic’s IT sector is shining especially brightly. The rapid digitization of business activities is leading to unprecedented levels of demand for skilled IT workers. Recent investments show that foreign businesses now see the Czech Republic as a key location in the global move online, and that incentives to encourage international interest are bearing fruit.