Greek Outliers 2023 Report | Choose Greece

By Endeavor Greece Jan 14, 2024

Despite being a relatively small country, Greece has never struggled to make a big impression on the world. The Mediterranean nation is famed for its natural beauty and rich history, as well as for the financial crisis and resulting recession that rocked the country a decade ago. But many outside of Greece have yet to fully understand just how much the country’s image is in need of an update.

Greece today isn’t just doing better. It’s booming.

Speak with local entrepreneurs, investors, policy makers, and executives and you’ll hear story after story of a blossoming innovation ecosystem that is laying the groundwork for an even more exciting future.

Challenges of course remain, but Greece is making strides towards becoming an attractive homebase for talent, entrepreneurs, and investors concerned with opportunity, impact, and lifestyle. Companies looking for a regional hub or promising new market will find welcoming, solution-minded local partners keen to discover ways to work together to make Greece a model of fresh ideas and big thinking.

Macroeconomic basics.

The macroeconomic statistics speak for themselves, showing the crisis of a decade ago is well behind the country. Last year Greece’s GDP grew 5.9% year over year, nearly twice the EU average, and unemployment has fallen to its lowest level in a decade, reaching 11%. Youth unemployment is the lowest ever recorded. In 2022 the ratio of debt to GDP fell more in Greece than in any country in the world. Greek manufacturing production has increased between 10% to 15% since 2019, while declining in many traditional European manufacturing powerhouses.

The numbers for the Greek innovation ecosystem are equally impressive. From barely existing a decade ago, the combined value of the country’s startups was estimated at $10 billion in 2022, up from $8 billion in 2021. Greek startups raised about $1.4 billion in 2022, $570 million of which was equity financing. Greece’s VC/GDP ratio increased nearly tenfold in just the last two years, though the country is not immune from the current “VC winter.” Fundraising has slowed significantly in 2023. There were six exits totalling around $200 million in 2021, and 17 totalling $300 million in 2022, including Accusonus, Pollfish and Transifex. Tech jobs in Greece now account for about 1.3% of total employment (52,000 jobs). Startups employ 10,000 people.

Traditional sectors and larger companies are doing well too. The tourist season this summer was so busy that access to some of the country’s famed archeological sites had to be limited to contain the crowds, and many multinational companies have set up shop in the country. Microsoft is building a €1 billion data center near Athens, while Pfizer will anchor a €650 million research hub north of the capital. Cisco, JPMorgan, Meta, Tesla, and Klarna are among the many established international companies and larger startups investing in Greece.

Credit ratings agencies have taken note of the country’s steady efforts to pay back its debt. In September DBRS Morningstar raised Greece’s debt rating to investment grade and Moody’s raised its debt rating by two notches, citing “profound structural change” in the country’s economy, finances, and banking system.

This progress has created a positive, predictable backdrop against which businesses, large and small, can plan for the future. “What is great is that after spending ten years worrying about macro, we're just talking micro. We're talking projects, we're talking investments, we're talking M&A, we're talking new acquisitions, we're talking foreign direct investment. There's such a palpable excitement,” reports Dimitris Papalexopoulos, Chairman of the Group Executive Committee of Titan Cement International.

Government reforms.

The roots of this incredible turnaround story are many. But stable, business-friendly leadership has certainly played an outsized role. The currently serving prime minister, Harvard-educated former banker Kyriakos Mitsotakis, was first elected in 2019 and set about making the country friendlier to businesses by reducing taxes and red tape. In elections earlier this year his center-right New Democracy party won an outright majority, requiring no political jockeying to form a coalition government and ensuring Mitsotakis another four years as prime minister.

“What the government has done is tried to create a lot of incentives to attract both people and companies”, explains Alexis Patelis, Chief Economic Advisor to the Prime Minister. These include a program that reduces income tax by half for seven years for anyone who relocates a job to Greece, a digital nomad program to attract remote workers for shorter stays, reduced tax rates for pensioners, a non-dom program for wealthy investors, and lower rates of taxes on stock options, capital gains, and dividends

The government’s business-friendly stance doesn’t just show up in lower tax bills. It’s apparent in day-to-day dealings with the state, and people’s levels of frustration with their government.

Andreas Stavropoulos, a partner at VC firm Threshold Ventures, also stresses the optimism brought about by the “reduced friction” of operating in Greece, but also cites more official measures of the recent reforms. “If you look at the ease of doing business index, it has multiple sub-components. Greece has made tremendous strides in pretty much all of them,” he points out.

A changing world makes Greece even more attractive.

Just not being annoyingly bureaucratic isn’t enough to attract innovators, of course. But Greece has much more to offer than simply stable leadership and solid economic indicators. The country has long drawn visitors with its excellent weather, natural beauty, delicious food, and healthy, relaxed lifestyle.

This traditional advantage is only amplified in a post-Covid world where altered attitudes towards remote work and new tech tools make countries like Greece an even more attractive base of operations for those with an international outlook. Greece’s turnaround means the country offers far more local opportunities as well.

“One of the traditional issues with Greece was that great quality of life, but the professional opportunities were kind of limited. Now that's changing,” Papelexopoulos believes. Wealthy innovators and job creators seem to agree as Greece was the seventh most successful country at attracting millionaires this year, according to the Henley Private Wealth Migration Report 2023. The government has put a strong emphasis on upgrading the country’s digital infrastructure to take advantage of this shift. “We're blessed with what we would consider to be a beautiful country and you can work here, but to do that you need to have the digital infrastructure. That's now in place,” claims Patelis.

This is a recruiting boon for innovative companies looking to lure international and diaspora talent. “People with very good backgrounds from the US, from the UK, they're coming here as digital nomads, but I think most of them are coming back to join companies like ourselves. So there is a little bit of a brain gain rather than drain happening,” reports Hellas Direct’s Pantazis

Greece’s vibrant diaspora, which grew hugely during the crisis years and is now eyeing the country’s recovery from afar, provides an important talent pool for Greece-based companies. “When multinationals come to us and they say, ‘I want to make an investment in this city in Greece, can you tell me how many people you have in a radius of 20 miles?’ I say to them, that's not the right question to ask. Because if you actually open up offices and try to hire people, you'll get applications from all over the world. There is this diaspora of people who are looking to relocate to Greece if the right job comes along,” insists Patelis.

Once in Greece international and diaspora talent will find an increasingly large and vibrant startup community, championed by groups like Endeavor and served by a growing array of community events, gatherings, and pitch competitions. Established businesses also have a growing appetite to partner with and support earlier-stage business, according to Papalexopoulos, who is also the Chairman of the Board of Directors of SEV (Hellenic Federation of Greek Enterprises), which now counts 120 unlisted, smaller companies collectively valued at some $8 billion, among its members.

While lifestyle factors make Greece attractive to talent, salaries for skilled employees remain significantly lower than in many better-known innovation hubs. ”Greece still has very good talent and frankly, very competitive salaries and much higher loyalty,” observes Stavropoulos. Investors will also find deals. “There's not a lot of competition, so you don't have to pay high prices. You can still have folks who will be very happy to see you instead of having to battle to get an allocation into one of the hot companies out in Silicon Valley or elsewhere,” he adds.

However, just as the labor market has tightened around the world in recent years, it has also tightened in Greece. Salaries may remain relatively low, but 77% of Greek employers report having difficulty filling open roles, on par with the global average, according to a recent survey by global staffing firm Manpower Group. Attracting experienced talent from abroad can help address these challenges, as could bringing more women into the workforce. Women still represent only 18% of the tech workforce in Greece compared to a global average of 30%.

This is a challenge the government is committed to addressing. “We have to expand our labor supply,” Patelis says. “When you look at the areas of the population that are underrepresented in the labor force today compared to other countries, the one that sticks out is women."

Big challenges remain. So do big opportunities.

Macroeconomic indicators, government reforms, relatively inexpensive and plentiful talent, and sunny weather are enough to make Greece an undersung competitor to other vibrant regional innovation hubs. But Greece’s boosters insist that the country offers not just the opportunity to incrementally expand or build a solid startup serving the local market. Its bumpy recent past, strategic position, and even current challenges make Greece a place to dream bigger.

Pantazis makes the case that Greece is about much more than sun, sea, and work-life balance. This is a country that defines toughness in the face of adversity. “I would put any Greek entrepreneur in front of a Silicon Valley entrepreneur right now, and I would say probably this person is stronger because they've been through a lot more stuff,” he says.

Add to that battle-tested resilience, the benefits of surprise and geography. “If you want to disrupt regionally, especially in big industries like financial services, banking, insurance, then this is a fantastic starting point because it's a big enough market. It's in the blind spot of the big guys, but you can test things, you can even reach scale. And then from then on whether you go towards the Balkans, you go towards the Middle East. You’re very well positioned to test other markets.” Stavropoulos, for his part, argues that Greece’s remaining challenges makes the country more rather than less likely to incubate breakthrough ideas.

Citing the recent flurry of AI advancements, Stavropoulos says: “Sometimes when you've got a significant paradigm shift or technology wave that's finally coming of age, sometimes it's easier to leapfrog than it is to make incremental change.” Serious challenges still facing Greece, including border security in a nation with some 6,000 islands, a backlogged justice system, and the threat of climate change in an already fire and drought-prone environment, present entrepreneurs with other opportunities to envision whole new approaches rather than tinkering with existing ideas.

And there is a synergy between the need to envision bold new solutions, a culture and lifestyle that is friendly to creative ideas, and emerging tech tools that streamline starting a business away from traditional centers, Stavropoulos adds.

“If you think about the impact of things like AI, where the friction between having an idea and having that idea implemented becomes smaller, the value of inspiration, the value of creativity, goes up. So it's not about, how many hours do I put in? It's more about how many new ideas did I have?” he observes. Greece’s more spontaneous and relaxed approach to life isn’t just healthy and enjoyable, it’s also conductive to the kind of mindset that leads to just that kind of creativity. And as AI advances, the value of ideas vis a vis sheer hustle looks set to rise.

Build the future in Greece.

When it comes to innovation and tech, Greece is not yet New York or Berlin or Tel Aviv. Digitization remains a work in progress, the justice system can be slow, partnerships between startups and academia and industry are in their early stages, the ecosystem would benefit from more late-stage venture capital, and securing adequate talent is a challenge here as elsewhere. But in the end the fact that Greece is still creating its future as a startup hub might be its biggest selling point.

The challenges of the past decade have created scrap- py and resourceful talent, as well as a population hungry for both good governance and innovative solutions. Outdated ideas about the state of the country among outsiders mean businesses, hiring managers, and investors can fly under the radar and strike great deals. A strategic location and political stability in an increasingly dangerous world provides a solid launch pad for companies. And remaining knotty problems can serve as a catalyst for breakthrough ideas.

Perhaps Papalexopoulos captures the excitement and appeal of getting in on the ground floor of innovation of Greece best with a story: “I had a friend of mine who was a professor at MIT and he used to say that when he developed a new course, the first time he delivered that course to his students he was very unhappy with it. The structure didn't quite work. The flow was not perfect. He was developing it as he was going along. But he got rave reviews from his students. By the fifth time he had it down pat, but he got good reviews but not great reviews.”

“My take from that story is that people want to be part of a creation and discovery more than they want to be served a perfect canned product. And so my take on Greece is, be there for the joy of discovery and creation, more than perfection and fine tuning."

Read the full report here: The Greek Outliers 2023