- Jessica Batman
- BBC Capital
The story of Antonios Chalkiopoulos is common among many Greeks. After studying in London, he returned to Athens in 2002 and worked as a software engineer.
“Then came the crisis,” he says. “I have decided to return to the UK and look for new opportunities.”
Since the near bankruptcy of Greece in 2010, life has been particularly difficult for young Greeks.
Now there are signs of recovery. The economy grew by 1.6% in 2017 and the country is expected to complete its bailout program in August.
But the unemployment rate for those under 25 is still 45%. And for those lucky enough to find work, the options are limited.
Average salaries are around 700 euros ($856) per month, and Greece is one of the most expensive and difficult places to start a business in Europe.
It is therefore not surprising that up to 180,000 graduates left the country looking for work elsewhere for the past eight years.
Additionally, surveys suggest that up to 76% of teenagers consider studying or working abroad.
“This mass migration is different from others we have seen before because it is a real qualitative flight,” says Aliki Mouriki of the Greek National Center for Social Research.
“The most educated people leave and the UK and Germany benefit from it when they haven’t paid a single euro for their education.”
The flight of human capital or “brain drain” can weigh heavily on the economies of the poorest countries.
But now there are projects that have professionals like Chalkiopoulos thinking about returning home.
His software company Landoop, which he founded in London, last year received a $1 million investment from Marathon Venture Capital, a venture capital fund aimed specifically at Greek entrepreneurs.
Recipients must spend about half of the money they receive in their home country and be part of their team and business there.
A venture capital company is created by a group of wealthy investors, banks or financial institutions, who come together to invest in one or more startups and help them get off the ground.
The company generally expects to receive shares in return.
Panos Papadopoulos, director of Marathon Venture Capital, wants to use the skills migrants acquire abroad to help create those same opportunities in Greece.
The Marathon fund receives between 50 and 90% of its capital from the Greek government, the European Investment Fund and the European Investment Bank.
These public entities have invested US$320 million in nine different venture capital firms.
There’s no place like home
How do you convince someone to develop their business in a country where the economic outlook and the business environment are still gloomy?
According to Astyanax Kanakakis, CEO and co-founder of Norbloc, a technology company based in Stockholm, Sweden, and one of the first companies in which Marathon invested, it was an emotional decision linked to a sense of belonging.
“I have lived in many different countries and Athens is always the place in the what else I To feelIs What in home”He says.
“Most of my friends who came back did so out of nostalgia, not because they had a great business opportunity,” he says.
Marathon’s Papadopoulos agrees: “It’s an emotional thing, it’s easier to build trust if you have the same language and experiences.”
This investor also believes that the entrepreneurs he works with want to help create better opportunities for other Greeks.
When offered the investment, Norbloc’s Kanakakis was already looking to open a head office that would be well placed to visit clients in Europe and the Middle East, so the opportunity “made sense”.
His company now has seven employees in Greece. Some of them previously worked abroad and wanted to return to their country.
However, Kanakakis describes the process of setting up a subsidiary in Greece as “extremely hard”.
“If I had been a new entrepreneur, I don’t know if I would have bothered,” he laments.
No leak no gain
Some academics argue that countries can benefit from human capital flight when workers return with new skills.
“If people come back, they compensate for the theft, because they will bring with them not only professional skills, but also social and personal skills,” says Mouriki of the Greek National Center for Social Research.
However, Devesh Kapur, a professor of political science at the University of Pennsylvania, USA, is skeptical about the extent to which venture capital could help the economies of developing countries.
“(This market) is still very small for most countries. You need to have a sophisticated technology sector and human capital. There must already be fertile ground for any venture capital industry to take off,” he says.
This model is also not suitable for all entrepreneurs, according to Kanakakis of Norbloc.
“By stipulating that the businessman has to spend a certain amount of money in Greece, they are forcing him to make a business decision and it may not be the right time for his business to make that decision” , he said.
Marathon has already invested in five companies and is financing two more.
Additionally, it has created 20 tech jobs in Greece.
Over the next four years, it plans to fund a total of 20 companies. “If we succeed, we will have two or three companies that employ about 1,000 people each,” explains Papadopoulos, of this capital company.
Kanakakis adds that he is “cautiously optimistic” and hopes that “projects like this will cause changes in mindsets that will then spread.”
You can now receive notifications from BBC World. Download the new version of our application and activate it to not miss our best content.