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# AI Is Everywhere, Investor Money Isn’t: EY’s 2026 Entrepreneurship Data
- URL: https://www.therecursive.com/ai-is-everywhere-investor-money-isnt-eys-2026-entrepreneurship-data/
- Published: 2026-10-01T14:19:48.000Z
- Updated: 2026-10-01T14:59:02.000Z
- Description: Business owners across wider Europe are quickly adopting AI, but most still fund growth from their own profits and remain cautious about costs, regulation and uncertainty.
- Author: Yoana Stanislavova

Across the wider European region, most business owners still fund growth from their own profits and have little interest in selling. Bulgaria is moving in a different direction. According to the [2026 EY Entrepreneurship Barometer](https://www.ey.com/content/dam/ey-unified-site/ey-com/en-gr/insights/entrepreneurship/documents/ey-entrepreneurship-barometer-report-2026.pdf?ref=therecursive.com), the share of Bulgarian entrepreneurs who say a sale in the next 12 months is "not at all likely" dropped from 90% to 63% in a year, the strongest shift toward openness among all surveyed countries.

The research covers 1,009 entrepreneurs in 14 countries across wider Europe, surveyed in February and March 2026\. This article looks at the main regional findings on financing, AI and business barriers, and at how Bulgaria compares, based on a national subset of the survey prepared in partnership with BESCO – The Bulgarian Entrepreneurial Association.

> *"We have moved from a period of building the ecosystem to a period of growth," Milev said.*

## Funding growth and planning exits

Across the region, 65% of entrepreneurs rely mainly on reinvested profits and their own funds, unchanged from a year earlier. Bank loans are the main source of finance for 21%, and external investors or private equity for just 6%. EY notes that this self-reliance "places a ceiling on the pace of transformation." Croatia is the most debt-funded market, with 41% relying mainly on bank loans, while Kazakhstan relies more than most on investor-led financing.

**Where companies do invest**, the focus is moving toward efficiency. Investment plans softened in most areas, with **process automation** the only category holding steady, and the share of firms planning no major investment rose from 9% to 11%. Owners also remain patient: two-thirds (66%) are not at all likely to sell part of their company in the next year, and family succession (40%) and a sale to another company (39%) are the most common long-term plans.

In Bulgaria, **founders are more open to outside owners**. Asked about succession options, 44% would consider selling to another company and 32% to an investment fund, a share roughly unchanged from last year. 16% would consider an IPO. Both the fund and IPO figures are higher than in the wider region, where they stand at 22% and 11%. Family succession is considered by 32% of local respondents, compared with 40% regionally. EY describes the figures as a gradual shift toward more professional, market-driven exits. 

**Access to financing** is named as a barrier by 33% of entrepreneurs across the region, up from 30%. In Bulgaria, it showed the sharpest increase of any barrier: 43% now name it, compared with 19% a year earlier. 56% of Bulgarian entrepreneurs also say a lack of funds could hinder their investment plans, against 41% regionally.

**Nikolay Garnev**, Managing Partner at EY Southeast Europe, advised entrepreneurs to diversify their funding sources early. EY's recommendation is to rely less on self-financing and bring in partners, strategic investors and blended financing before growth capital becomes urgent. Many startups and business owners are not aware of the options available to them, including state aid and EU funds, and there is a persistent misconception that state aid is not allowed, Garnev said. 

Milev added that the financing gap looks different at each stage of a company's development. At the earliest stage, founders often need mentoring as much as money. Further along, they need venture funds. For companies that are ready to scale, he pointed to Bulgaria's pension reform as a potential new source of long-term capital.

## What the pension reform could change

The reform Milev referred to is already law. Bulgaria [changed the rules for its mandatory private pension funds](https://www.wolftheiss.com/insights/bulgarias-second-pillar-pension-reform-unlocking-new-investment-opportunities-through-a-mandatory-multi-fund-model/?ref=therecursive.com) in March 2026, and from 1 January 2027 each fund will be split into three portfolios with different levels of risk. Everyone under 50 will be placed in the highest-risk "dynamic" portfolio by default, which can invest up to 90% of its assets in equities and other higher-risk instruments, including alternative investment funds such as VC. The funds hold [more than €17.2 billion in total.](https://www.bta.bg/en/news/bulgaria/1165892-bulgarian-pension-security-companies-generate-eur-584-mln-in-investment-income-i?ref=therecursive.com) 

Whether that money reaches growing companies will depend on the investment choices of the pension companies themselves.

In Estonia, the pension funds of Swedish banking group SEB became a key investor in the early-stage VC fund Superangel in 2024, bringing its second fund to nearly €40 million.

## More companies are investing in AI

Across the region, AI adoption rose to 76% from 61%, and the share of businesses with no AI investment over the past three years fell from 43% to 25%. Returns are slower to arrive: 60% of companies say digital technologies made them more efficient and 51% that they cut costs, but only 38% have seen revenue growth. Expectations are cooling, and the share expecting AI to significantly boost efficiency fell from 68% to 61%.

Companies mostly use AI for internal work such as data analysis (54%), marketing (42%) and administration (42%). Its use in customer support fell from 37% to 32%, which EY links to concerns about brand risk and loss of control. Worries have also shifted toward data privacy (53%, up from 48%), unclear regulation (45%, up from 38%) and intellectual property (36%, up from 30%). Adoption varies widely between markets: Slovakia leads at 89%, while 57% of Hungarian companies still invest nothing in AI.

Bulgaria is moving faster than the regional average. 86% of entrepreneurs say their use of AI increased over the past year, and the share of companies investing nothing in AI fell from 52% to 22%. Expectations have also become more measured, with 68% expecting a significant boost to efficiency, down from 87% a year ago.

## Regulation and other barriers

Economic uncertainty is the biggest brake on investment across the region (57%), and geopolitical instability is gaining weight, cited by 40% compared with 35% a year ago. Rising costs are the main day-to-day pressure: 80% of companies see higher labour costs as a threat to their financial security, and 79% say the same about operating costs. Supply chains are the one risk that has grown worse, with their net negative impact rising from 35% to 41%.

**Bureaucracy and regulatory complexity** remain the top barrier across the region (63%) and are felt most in finance and tax, where 53% report a negative impact. Poland and Kazakhstan are the exceptions, with entrepreneurs there more likely to see regulation as helping growth. Overall sentiment is improving slowly: 28% rate conditions as favourable, up from 24%, while 45% call them unfavourable. Slovakia is the most pessimistic market, with 84% describing conditions as unfavourable.

Bulgarian entrepreneurs are more optimistic: 43% describe the conditions for doing business as favourable, up from 26% in 2025\. Bureaucracy and regulatory complexity are still their biggest obstacle, named by 66%, down from 71%, followed by a shortage of skilled workers (52%) and political and economic instability (49%).

On regulation, Milev gave the example of a Bulgarian startup developing cancer diagnostics. Before reaching the market, it has to go through four to six regulators one by one, and a competitor from Poland could get there first. His proposal is a [regulatory sandbox](https://www.lb.lt/en/regulatory-sandbox?ref=therecursive.com), where innovative companies can test products under supervision.

Lithuania has run one for fintech since 2018\. The Bank of Lithuania's regulatory sandbox lets companies test new financial products with real customers under its supervision, and after its first participant, a peer-to-peer insurance platform, completed a year of testing, the central bank [used the results](https://www.lb.lt/en/news/peer-to-peer-insurance-platform-the-first-innovation-tested-in-the-bank-of-lithuania-s-regulatory-sandbox?ref=therecursive.com) to prepare rules for such services.

For AI, the EU requires every member state to [set up a sandbox by August 2027](https://www.ey.com/en%5Fbg/insights/ai/ai-act-and-digital-omnibus-compliance-alert?ref=therecursive.com). [Spain was the first](https://www.whitecase.com/insight-our-thinking/ai-watch-global-regulatory-tracker-spain?ref=therecursive.com), testing twelve high-risk AI projects in 2025, including in healthcare diagnostics.

Garnev noted that entrepreneurs should not expect regulation in Europe to ease, and advised companies to build in-house compliance expertise from an early stage.

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