The need for an en­tre­pre­neur­ial ecosys­tem

Financial Mirror (Cyprus) - - FRONT PAGE -

I re­cently took part in an en­tre­pre­neur­ial ed­u­ca­tional field trip to Athens or­gan­ised by CIIM’s En­trepreneur­ship and In­no­va­tion Cen­tre (EN­TICE). This is part of a se­ries of ed­u­ca­tional field trips that CIIM or­gan­ises ev­ery year that in­cludes a se­cond en­tre­pre­neur­ial field trip to Tel Aviv. The pur­pose was to visit var­i­ous or­gan­i­sa­tions (stake­hold­ers) that make up the en­tre­pre­neur­ial ecosys­tem in Greece as well as var­i­ous suc­cess­ful start-up com­pa­nies and en­trepreneurs.

Given the cur­rent state of the Greek econ­omy and the prob­lems that it has been fac­ing for many years, my ex­pec­ta­tions were very low. To my sur­prise, I dis­cov­ered that Greece (yes, Greece!) has a well-func­tion­ing en­tre­pre­neur­ial ecosys­tem that pro­motes and sup­ports in­no­va­tion and the cre­ation of new busi­nesses that are so vi­tal for the coun­try.

The pro­gramme in­cluded vis­its to in­sti­tu­tional or­gan­i­sa­tions pro­mot­ing the cre­ation of the en­trepreneur­ship and in­no­va­tion ecosys­tem (TA­NEO, PRAXI, Co­ral­lia Clus­ters Ini­tia­tive), ac­cel­er­a­tor and co-work­ing spa­ces (Egg, IQ­bil­ity), in­no­va­tion and en­trepreneur­ship fund­ing bod­ies (At­tica Ven­tures, PJ Tech Cat­a­lyst), suc­cess­ful start-up and spin off com­pa­nies (Poll­fish, Covve, i-sieve and Apivita) and a half day of lec­tures at ALBA Grad­u­ate Busi­ness School.

TA­NEO is a Greek state-spon­sored and pri­vately funded, in­de­pen­dently man­aged “fund of funds” that uses its fund­ing to in­vest through ven­ture cap­i­tal funds in Greek start-up com­pa­nies.

PRAXI/HELP-FOR­WARD Net­work, on the other hand, is a na­tional tech­nol­ogy trans­fer or­gan­i­sa­tion that aims to trans­fer knowl­edge, pro­mote in­no­va­tion and en­trepreneur­ship, and im­prove com­pet­i­tive­ness of Greek com­pa­nies by link­ing re­search in­sti­tu­tions with the in­dus­try.

Co­ral­lia Clus­ters Ini­tia­tive is an or­gan­i­sa­tion that was es­tab­lished to de­velop and man­age in­no­va­tion clus­ters in spe­cific sec­tors and re­gions of the coun­try with the aim to es­tab­lish a com­pet­i­tive ad­van­tage for the par­tic­i­pat­ing play­ers.

Egg (en­ter-grow-go), as well as IQ­bil­ity are in­cu­ba­tor/ac­cel­er­a­tors with the role to iden­tify, in­cu­bate and ac­cel­er­ate the de­vel­op­ment of high-po­ten­tial start-ups in Greece. At­tica Ven­tures and PJ Tech Cat­a­lyst are ven­ture cap­i­tal funds that draw their money ei­ther from pri­vate in­sti­tu­tional in­vestors (banks in this case) or from EU struc­tural funds and their role is to iden­tify, in­vest (fi­nance) po­ten­tially suc­cess­ful start-ups by ac­quir­ing an equity stake in them with an exit plan usu­ally in 5-7 years.

We should draw lessons from the set-up of the Greek en­tre­pre­neur­ial ecosys­tem and of course from the Is­raeli one. Pres­i­dent Anas­tasi­ades should in­clude it in his agenda as an­other area of col­lab­o­ra­tion fol­low­ing last week’s dis­cus­sions with the Greek and Is­raeli Prime Min­is­ters and ask for help and guid­ance.

The sta­tis­tics pro­vided


the mo­ment

for Cyprus on in­no­va­tion and en­trepreneur­ship are not en­cour­ag­ing. Ac­cord­ing to a re­cent study by EY Cyprus (In­no­va­tion and En­trepreneur­ship Dy­nam­ics, Septem­ber 2015), Cyprus was among two EU mem­ber states that ex­hib­ited a de­clin­ing in­no­va­tion per­for­mance in 2014 (In­no­va­tion Union Score­board 2015), and has been re­clas­si­fied down­wards from “in­no­va­tion fol­lower” to “mod­er­ate in­no­va­tor”. The level of our in­no­va­tion in­dex is now well below the EU av­er­age. An­other in­ter­est­ing statis­tic in this re­port is the per­cent­age of the coun­try’s GDP that is used for Re­search and De­vel­op­ment (R&D). For 2013, this is at 0.48% (or EUR 86.1 mln in real terms), which is amongs the low­est rates in the EU.

Read­ing the full re­port, I came to the con­clu­sion that al­though there are some in­di­vid­ual, scat­tered ef­forts from par­tic­i­pat­ing stake­hold­ers (govern­ment, pri­vate or­gan­i­sa­tions and net­works, aca­demic in­sti­tu­tions, etc.), the ef­fort must be co­or­di­nated and needs a greater sup­port from the govern­ment and the busi­ness com­mu­nity. Al­ready, the CIIM to­gether with the Bank of Cyprus launched the IDEA pro­gramme (In­no­vate-De­velop-Ex­cel-Ac­com­plish) last year to iden­tify, sup­port, in­cu­bate and ac­cel­er­ate in­no­va­tive star­tups with a global out­look.

Many more of th­ese ef­forts though are needed if we want our youth to en­ter this field and be­come en­trepreneurs. Pro­mot­ing in­no­va­tion and en­trepreneur­ship creates a more com­pet­i­tive en­vi­ron­ment, pro­motes growth, creates new jobs, and helps to in­crease the for­eign di­rect in­vest­ment in the coun­try.

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