Renee Maltezou and Karolina Tagaris

ATHENS, Reuters – After years of Greece being known as a country with financial problems as much as its beaches over the past decade, deals in recent months have revealed a small but thriving startup community that has emerged since the crisis.

JP Morgan’s acquisition https://www.reuters.com/technology/jpmorgan-agrees-acquire-49-stake-greek-fintech-viva-wallet-2022-01-25 of a minority stake in fintech Viva Wallet last month valued the payments company at over $2 billion, giving Greece its first tech “unicorn” after a steady buildup of the sector over the past seven years.

That deal is expected https://www.reuters.com/technology/facebook-owner-meta-close-deal-greek-startup-accusonus-source-2022-02-01 to be followed up this month by Facebook (NASDAQ:) owner Meta’s acquisition of Accusonus, a startup founded by a pair of engineers and amateur musicians whose audio software is used by the likes of Bob Dylan and Shakira.

Marathon Venture Capital reported that funding for startups in Greece based in tech has risen to almost $1 billion in 2017. This is more than twice the amount raised in 2020, and close to 10 times what was raised in 2015.

Prime Minister Kyriakos Beitakis has received a boost from these deals. He builds on previous governments’ work with the EU and offers tax breaks as well as funding reforms that aim to diversify an economy which is dominated by shipping and tourism.

He stated that Greece was not only a country that depends on tourism, its beautiful beaches and tourists.

SEV estimates that the total startup sector is worth 6 billion euro, or 3 per cent of GDP. It does not specify how much of it tech startups account for. Markos Veremis from its innovation committee said that it has established a target for the tech sector to achieve 10% GDP over the next ten years.

The optimism is not enough to keep Greece at the top of the 2021 Digital Economy and Society Index by the European Commission. It scores low in connectivity and internet use, and has a poor record for digital public services.

It is not far from European startups hubs such as London which, according to Dealroom, raised $25 billion in record funding in 2021. However, the company faces fierce competition from southern European countries, like Portugal which holds Europe’s largest technology conference, Web Summit.

There is a growing network of investors and entrepreneurs as well as workers with international experience who are active during these crisis years.

George Tziralis from Marathon (Athens-based) stated that “What began as an underground movement in small nerdy community is now front and center in Greek society.” He believes technology will grow to match the shipping industry’s 7% contribution to Greece’s economy over the coming decades.

MOMENTUM

In 2000, startups were almost unheard-of when Viva was established under the name Realize. What started as a small software company has evolved into a financial technology firm that operates in 23 European countries.

Makis Antypas (Viva Wallet’s Chief Information Officer and co-founder) said that there is a lot of momentum in the burgeoning Greek economic and Greek startups should take advantage.

In 2008, the crisis began that lasted a decade and forced young Greeks to flee to northern Europe to find better jobs or to invent.

Today, successful startups based in Greece include Beat, an app for taxi hailing, Skroutz e-commerce platform, and Pollfish, which is a market research startup.

Panos Zamanis (vice-chairman, Hellenic Startups Association) stated that Greece has “raised generations” of people with dreams of becoming government employees or entrepreneurs. These stereotypes were broken only by a crisis, he said.

“We don’t yet have the situation we deserve…but we cannot forget that our country has been slow to innovate and was in severe financial crisis.”

Mitsotakis, a conservative government that took office in 2019, one year after Greece had exited the largest financial bailout of history, has prioritized digital transformation. The government has created corporate tax reforms and simplified the process of setting up companies and issuing stock options.

High-profile investments, such as Microsoft (NASDAQ)’s decision for Greece to host a data centre in its headquarters in Microsoft (NASDAQ), have reflected the improved economic environment. And there is more.

GWI founder Tom Smith said that national and payroll taxes were too high. However, he welcomes any efforts to increase Greece’s appeal.

He said, “When you combine changes in sentiment, investment, tax policy, and incredible lifestyle, it becomes a compelling offer.”