Lessons from a Success Story
By Endeavor Greece Oct 14, 2021
"An idea without a plan is just a wish.”
There is no doubt that it was one of the top moments of the past year. When the acquisition of Softomotive, a robotic automation company, by Microsoft was announced in May 2020, it was the largest acquisition of a Greek tech company up to that time, at a cost that exceeded 125€ million.
To date, much has been written about this success story. For the purpose of the present report, we talked to the protagonists, the founders of the company and Endeavor Entrepreneurs Marios Stavropoulos and Argyris Kaninis, in order to identify the “lessons” to learn from Softomotive’s success and to figure out their views on the development of the innovation ecosystem in Greece.
Change of Scene
Softomotive was founded in 2005, and just before the mid-2010s it was a profitable company, that continued to develop its product, based on individual users. In 2014, there was a major turning point as it shifted from the individual user to the B2B. The rapid annual growth that ensued led to its raising 25$ million from the investment company Grafton Capital in 2018, and to its acquisition by Microsoft two years later.
On account of this journey, Marios Stavropoulos, founder, and CEO of the company is the most suitable person to capture the changes that have taken place in the innovation ecosystem from the founding of Softomotive to the present day. “It has been a personal experience to me and my view might be quite subjective, but I see that we are slowly entering a wider environment with external players. Some years ago we were naive, thinking that we were at the center of the world. Now we have realized that we are just a part of this world.”
Marios Stavropoulos explains in a number of ways the importance of networking in the global market, which manifests itself as a need and as an opportunity. For example, a fundamental challenge that lies at the heart of Greek entrepreneurship, which was also experienced by Softomotive’s team during the rapid growth and the scaling-up phase of the company, is that “talent” with experience in mature business practices is scarce. The first advantage that arises for the Greek ecosystem from such an exit is the interconnection with a foreign big tech company, such as Microsoft. “In the long run, some people fulfill their purpose as members of a team, and then, they want to achieve something on their own or they want to do something different. In any case, they are fully equipped to do so. At that time, we at Softomotive had to do everything on our own, crawling, searching, and asking around,” he recollects.
Another advantage is connected to the country’s image that has started to take shape gradually. “Greece has started to establish abroad its visibility, as a country that could potentially awaken the interest.” Its emerging profile changes through the positive news of acquisitions and foreign companies that launch departments in Greece, something that was non-existent some years ago. “This image is being shaped at the moment and it will continue to grow.”
It might still be the case that our country lags behind other countries which are synonymous to technological entrepreneurship, but still, Greece’s image is entirely different now from the image it had during the financial crisis. “Nobody enters the Greek market just for the sake of the Greek market. However, nowadays, the opposite is not either the case. Nobody will avoid the Greek market just because it is the Greek market. Now, there is an amazing difference in Greece’s brand name compared to one of 5-6 years ago,” he concludes.
“In my view, there is no serious doubt about the origin and country. Although it is a small market with a limited talent pool compared to more populated countries, Greece does not have any structural disadvantage or other limiting factors that discourage interest. There are still needs for specific skills – the technical part and business execution, especially if a company is at the stage of rapid growth. We need people that are capable of undertaking the management of a company. The people who have worked abroad are an obvious opportunity, as they could come back and fill the existing gap in the middle management.”
From his viewpoint, Argyris Kaninis estimates that we have well-trained human resources as far as software engineers are concerned in Greece. “In any case, Greece is a small country and the number of skilled engineers is not unlimited,” he underlines. In the field of development, an employee’s practical experience seems to be particularly helpful.
As far as attracting investors, he points out that “there is no magic recipe,” and he emphasizes the importance of focusing on profitability as a significant factor which proved to be particularly beneficial to Softomotive’s journey as well. He also notices an interesting shift in the companies of the ecosystem in comparison with the past: “Some years ago, we used to stay focused on a very good idea. Now it is enough. There have to be measurable goals. The mentality changes.”
Finally, he refers to the international experience that the Greek VCs have acquired, together with the Greek companies which compete with companies in Europe and America. The maturity of the ecosystem owes a lot to the contacts established with the Diaspora Greeks, to fundraising, to the mentoring structures, and to the experience that employees gradually acquire in business management. All these factors contribute to the maturity of a company, and consequently, to the maturity of an ecosystem itself.
Beyond Geographical Borders
This intentional and critical step guides FinTechs in the right direction so they can more immediately figure out who to work with. Ideally, a FinTech will be directed to the group that oversees innovation, which can streamline decision-making, further collaboration, and other enhancements.
Companies and organizations move away from the physical presence and adopt new ways of working, a trend that was considerably accelerated during the pandemic. “It is surprising how a huge organization such as Microsoft, which used to operate in a certain way, sent its employees home, and not only nothing happened, but also productivity rose considerably,” Marios Stavropoulos stated. “I do not claim that this model has no difficulties or faces no challenges, but we cannot help noticing that something that arose out of necessity is actually working. As a result, this development provides countries with quality of life and Greece can turn into an attractive destination. This is a very good idea, as long as there is a plan because any idea outside a plan is just a wish.”
Our country might have certain advantages, but we are not the only ones with these benefits, Marios Stavropoulos points out. “Any country on the planet, which is located on the same parallel as Greece, has good weather and similar climate. We should not limit ourselves to the line of thought that just one advantage of our country can solve all our problems. It is, indeed, an opportunity, a competitive advantage. But the question is how we make use of it. When one sells the product, they do not sell the raw material; it should undergo some kind of processing. The state has to play a central part in this strategy.”
Apart from attracting talent from abroad, Softomotive’s founders advocate that it is imperative that the Greek companies develop a universal approach. “One should and can start having a mentality that goes beyond geographical borders,” Marios Stavropoulos underlines. “As information technology matures, geographical borders play an important role in the production and distribution.” Argyris Kaninis concludes: “The outward-looking culture of a company is a matter of vision. One can be oriented towards the global market from scratch, or as the company grows. What is important is to offer something valuable, and this value should be directed at the general public.
This interview is one of many seen in our Greek Tech Revolution report. Check out our report below and stay tuned with our channels as we publish more interviews featured in the 2020 issue.