ATHENS — For 32-year-old Natalie Kontou, Greece’s economic crisis could be a blessing in disguise.
After losing her magazine job in 2011, at the height of the crisis, and following an unsuccessful period of job hunting in Australia the following year, she now runs her own fledgling business. It offers tailor-made tourist packages for a growing influx of foreign visitors to Greece.
“I always wanted to work in tourism, but I never imagined starting my own business, let alone with my friends,” she said, referring to her three partners in the Athens Insiders business. After starting last spring, with a budget of only 5,000 euros, the company managed to sell 20 tailor-made tours to individuals, couples or groups and is now seeking funding to expand.
The entrepreneurial dream is one that many Greeks pursue. With few opportunities in a crumbling private sector, with a record unemployment rate of 28 percent – and above 60 percent for those under 24 – many Greeks have stopped waiting for those in power to put the country back on its feet.
The Greek government and the troika of international donors agreed last week on economic reforms aimed at unlocking an estimated 10 billion euros in bailout funds. But almost all of it is going toward debt repayment instead of investing in the growth the country desperately needs.
It’s no wonder some Greeks are taking matters into their own hands.
Although thousands of businesses have buckled under the pressure of a deepening recession, now in its sixth year, thousands more have opened their doors, in defiance of this grim narrative. According to government figures, more than 41,000 new businesses were created in Greece last year. Most of them were food or clothing retailers or other types of businesses that few experts would consider entrepreneurial innovators.
But Endeavor Greece, a nonprofit organization that supports entrepreneurship, counted 144 of these companies as entrepreneurial start-ups, nine times more than in 2010.
Business incubators and shared workspaces have sprung up in Athens and other Greek cities in recent months to accommodate start-ups, while conferences and forums on entrepreneurship and innovation abound.
A dozen incubators compete to promote the best business ideas, helping to cover operating costs and providing mentoring. One of them, called Enter Grow Go, has taken Athens Insiders under its wing along with 20 other start-ups and is backed by Eurobank, Greece’s third-largest lender.
Another, Orange Grove, an initiative of the Dutch Embassy in Athens, supports nearly three dozen new companies, including Clio Muse. Run by three Greeks in their 20s, Clio Muse launched a mobile app last month that offers museum and gallery visitors in-depth articles on selected exhibitions.
In Athens, the newest private incubator is Romantso, named after the defunct women’s magazine in whose former headquarters it was based. There, dozens of designers, photographers and web artists pay around €300 a month to rent office space in an aesthetically avant-garde environment where they exchange ideas and develop their start-ups. Romantso supplements its income from rent with proceeds from an on-site bar, sponsorships and paid seminars.
Vassilis Haralambidis, a 37-year-old graphic designer who opened Romantso on a side street in a rundown central neighborhood last fall, said his goal was to “end the poverty.”
“We saw that people were paralyzed, that the country was going in the wrong direction and we decided to do something,” Mr. Haralambidis said. He deferred paying taxes, he explained, in order to invest that money in Romantso, although he declined to discuss the details of the deferral.
Authorities are supporting the start-up movement, as they have in other European countries, such as France and Spain, where youth unemployment is also high. The Greek government has reduced the bureaucracy and red tape that discouraged entrepreneurs in the past. New legislation, expected to come into force later this year, would allow a business to be officially established in just one day.
A European Union-subsidized program to support small and medium-sized businesses, worth one billion euros, is to be distributed this year among more than 16,000 Greek beneficiaries. An additional €130 million in loans and venture capital programs supported by the European Union has already been provided.
Many industry experts view venture capital and loans as a better option than European Union grants.
“Free money is not a solution,” said Panos Zamanis, co-founder of the Hellenic Startup Association, which advises new businesses, primarily in Orange Grove. He cited reports that millions of euros in EU subsidies had been wasted in the past on holiday homes and other luxury goods. “There must be an obligation to return the money.”
Some aspiring entrepreneurs said they preferred to go to investors offering seed funding or venture capital firms that can offer expertise as well as equity investments, rather than competing for funds of the European Union.
“The subsidies go to people with connections anyway,” said Yiannis Papageorgiou, 24, who last year started Truckbird, an online logistics service connecting shippers and transporters, with five friends. To attract customers, Truckbird started offering a free trial service last month. Mr Papageorgiou said more than 20 companies were now participating in the trial and he was in talks with potential investors.
The venture is a bold foray into the trucking industry, one of dozens of so-called closed professions that have been shielded from competition by a mass of regulations that the country’s international lenders have insisted be reduced or eliminated for revitalize the economy.
If Greece is to emerge from recession, analysts say it must stop being an island economy where most people work for the state or in copycat retail jobs.
“Among the crowds of Greeks setting up snack bars and takeaways, a handful are trying to do something better,” said George Pagoulatos, a professor of European economics and politics at the University of Athens and former government advisor.
Several fledgling companies have clearly succeeded, some with initial help from Greek venture capital funds, which have invested 20 million euros in around 20 domestic start-ups over the past two years, according to Yiannis Papadopoulos, who runs the Hellenic Venture Capital Association.
Several notables have expanded internationally.
Taxibeat, a mobile application allowing travelers to choose from nearby taxis based on preferences and ratings of previous passengers, has been deployed in France, Mexico, Brazil and Peru since its creation in Athens in 2011.
After securing 3.5 million euros in Greek venture capital, last year it secured a further 3 million euros from Hummingbird Ventures, a London company. Taxibeat claims to be now profitable in Greece and has a total of nearly a million users across its various markets.
Bugsense, a Greek company that tracks software flaws in mobile phone applications, was acquired last year by Splunk, a Nasdaq-listed software company based in San Francisco. Cookisto, an online service whose subscribers buy meals from home cooks, has expanded beyond Greece to Britain after securing €200,000 in seed funding from an entrepreneur Greek, Leon Yohai.
Workable, which designed software to ease the hiring process for small businesses that can’t afford a human resources department, has opened offices in London and Portland, Ore., since its Athens debut in 2012. She recently received $1.5 million in funding from Greylock. IL, the Anglo-Israeli arm of the American venture capital firm Greylock Partners.
These pioneers are a source of inspiration for their young compatriots, like Athens Insiders.
“I know it’s a gamble but we’re going to stick with it,” said Ms. Kontou, whose company plans tours in five different languages and is exploring its financing options. “If we young Greeks don’t try to create something new, who will?”