Greece’s new start-up culture: technology and seagrass sunglasses - Taipei Times
Sun, May 06, 2018 - Page 15 News List

Greece’s new start-up culture: technology and seagrass sunglasses

With the financial crisis barring access to traditional jobs, many people were forced to launch their own start-ups to survive, but red tape and heavy taxes still present obstacles to many aspiring Greek entrepreneurs

By Karolina Tagaris and Lefteris Papadimas  /  Reuters, ATHENS and PATRAS, Greece

PHEE founder Stavros Tsompanidis arranges dried seagrass on a panel at his workshop in Patras, Greece, on March 8.

Photo: Reuters

Greek student Stavros Tsompanidis was walking on a beach when he saw a business idea in the piles of dried-up seagrass.

He decided to recycle it to make iPhone cases, sunglasses and gift boxes.

Four years on, his start-up, PHEE IKE, sells its products across Greece and abroad. He represents a change in mindset among young Greeks who are turning to entrepreneurship as a result of the financial crisis.

“If we don’t act, in the next five years we’ll be saying the same things: that Greece isn’t going well, that there are no jobs ... that we have a new program by the International Monetary Fund and European Union to support us,” the 25-year-old said.

Greek start-ups are mushrooming in a financial crisis that started in 2008. The economy is only just recovering. It shrank by a quarter and cut off traditional routes to employment — jobs in government and family businesses.

Start-ups were virtually unheard of a decade ago, but they are now creating jobs and offering some hope that Greece can reverse an exodus of its highly skilled youth.

Greece has no official start-ups register, but several private databases show they number between about 600 and 1,100. The earliest count of start-ups, made in 2010 by non-profit advisory Endeavour Greece, stood at just 16.

AngelList, an online database, put the current number at 600, while audit firm Grant Thornton LLP found 1,127 in a report last year. Greek venture capital firm Marathon VC, established only last year, counts about 1,000 tech start-ups in its database.

Venture capital in the sector is growing.

A European Investment Fund (EIF) initiative, supported by private investors, is expected to pump about 400 million euros (US$479.48 million) into Greek start-ups and other small businesses over the next five years.

In 2008, when George Tziralis, a partner at Marathon VC, launched a networking event for start-ups, about 12 people turned up. Now, 200 to 300 people attend each month and three to five new start-ups are presented.

“Ten years ago there was almost nothing,” Tziralis said. “Today we’re seeing something much more mature, which we believe to be the tip of the iceberg.”

Marathon VC has made five investments so far, has three more in the pipeline and Tziralis believes it can allocate its entire 32 million euro fund in under a year.

Tourism and shipping, Greece’s two main industries, are driving a tentative economic recovery.

The structure of the economy could change if the number of start-ups continues to grow, economists have said.

During the crisis, thousands of firms shut and unemployment peaked at 27.9 percent, with six in 10 young jobseekers out of work.

About 223,000 Greeks aged 25 to 39 emigrated in 2008 to 2013 to richer countries, central bank data show.

The austerity that was a condition of repeated international financial bailouts deepened the depression. Those who stayed in Greece had to innovate to survive.

“The crisis created necessity entrepreneurship,” Hellenic Startups Association vice chairman Panagiotis Zamanis said.

National Bank of Greece SA said the tech start-up sector is showing particular promise, even though it only has a total valuation of about 300 million euros.

“The Greek ecosystem of tech start-ups is still in its infancy, though it already shows signs of high growth potential,” it said in a report.

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