1) Risk financing for entrepreneurship in Europe faces challenges due to Europe being seen as "Old" compared to places like Silicon Valley, with a more conservative culture and slow moving approach. 2) Europe needs to develop a "culture of failure" through education and legislation to turn Europe "Young" again and better support entrepreneurship and risk-taking. 3) The Silicon Valley model of high funding and expectations is not a panacea for Europe, which should develop its own authentic growth models like the "Entrepreneurial Ecosystem" model of supporting startups through access to markets rather than just capital.

1. Materializing Innovation

2. Risk Financing for
Entrepreneurship
“Finding liquidity”
The Economist’s Credit Risk Management
Conference
Dimitris Tsigos
Founder & CEO
StartTech Ventures
www.linkedin.com/in/tsigos
Athens, November 9th 2012

3. “Significant shortening of risk
financing for
entrepreneurship in Greece”

4. Is it really about Greece?

5. USE(!) Vs USA
• The EU27 GDP is higher than the US
GDP
• http://europa.eu/about-eu/facts-
figures/economy/index_en.htm
• Angel investments (2009)
– EU27: ~ 4B$
– USA : ~18B$
– Source: EBAN, www.eban.org

6. It’s not about Greece.
It’s about OLD Europe

7. How does an old person
behave?
• Conservative
• Slow moving
• Does it look like the ideal ground for
“Risk Financing for
Entrepreneurship”?

8. Need to develop the
“Culture of Failure” in
Europe
Turning Europe YOUNG again!
•Education
•Legislation

9. The Silicon Paranoia
• “Silicon Roundabout”, UK
http://www.siliconroundabout.org.uk
• “Silicon Beach”, Australia
http://siliconbeachaustralia.org
• The “Greek Silicon Valley”
– “Acropolis Technology Park”
– “Alexander Innovation Zone”
– a.s.o….

10. Stop insanity now!
• There’s only one Silicon Valley
• It’s NOT an “one size fits all”!
• Looking for the “European Facebook”
or the “European Google” is a kind of
provinciality
• Europe does not deserve it

11. The Silicon Valley model is
NOT a panacea!
We need authentic growth models
for start-up entrepreneurship
(including of course risk financing)
in Europe

12. USE Vs USA
• EU: The “grow- • USA: The “fail fast”
sustainably” model model
– Invest in unique – Investing in unique
teams ideas
– Focus to usefulness – Focus to excitement
– Invest less, support – Tons of funding,
more high expectations
– Higher percentage – Very low
of successes percentage of
– Higher return on successes
average – Very high returns
(?)

13. From Pyramids to
Pancakes
• Josephine Green: “From command
and control to a truly flat world of
collaboration!”
http://www.pyramids2pancakes.com

14. • We Europeans must champion the
pancake model versus the pyramid
one
• In other words:
– Europe’s strategy should NOT be about
domination, but it is about sustainability

15. The “Entrepreneurial
Ecosystem”
• A European approach challenging the Silicon
Valley model
• Key assumption: Access to market is more
important than access to capital
• Group of non-competing start-ups
• Enjoying economies of scale
• Without losing flexibility, strong entrepreneurial
drive
• Evolved in the journey from the first student
start-up in Greece to a Seed Fund, an Incubator
and a Business Angel Network
• http://
en.wikipedia.org/wiki/Entrepreneurial_ecosystem

16. Who can fund
entrepreneurship?
• Financial Institutions
• Governments
• Individual Investors
• Corporate Investors

17. Extreme necessity for incentives
for individuals and corporate
investors in promoting angel /
seed investments in Europe
• From “SME support” to “Start-up
support”
• Tax start-ups like individuals:
–Lower tax income – lower taxes

18. Governments
• Please, stop subsidies NOW!
• Subsidies kill entrepreneurship
• Looking for Customers is wiser than
looking for the right supplier
invoices!
• New instruments
– Business plan competitions
– Soft-loans
– State-backed Funds

19. Conclusions?
• Angel investments & corporate venturing
can drive risk financing for
entrepreneurship in Europe
• A plethora of successful examples already
exists
• Extreme necessity for structural changes
in the legal & tax framework as well as in
the education & research fronts
– Bridge innovation/research with market needs
– Create start-up-friendly environment

20. Thank you 