An Interview with Kostas Mallios. This interview is one of many seen in our Greek Tech Revolution report. Check out our report and stay tuned with our channels as we publish more interviews featured in the 2020 issue.
The way Greek entrepreneurs, founders, investors, and big players from abroad interact forming a value chain that we should magnify for the further growth of the ecosystem is perfectly reflected in the case of Kostas Mallios.
We have already referred to Think Silicon, the Greek company that was launched in Patras and operates in the field of semi-conductors. In 2020, it was acquired by the American giant Applied Materials. At Applied Materials, the person in charge of finding acquisition targets is Kostas Mallios, Corporate Vice President and General Manager. The American companies Dialog and Citrix – Dialog was the first client of Think Silicon back in 2010 – have been active in Patras’ innovation ecosystem through acquisitions of Greek teams for quite a few years. As to who introduced Kostas Mallios to Think Silicon, this was none other than the founder of Innoetics, the Greek company that was acquired by Samsung in 2017, which Kostas Mallios had helped considerably before joining Applied Materials.
This chain of happy coincidences has great importance. It is indicative of the multiplier effect that the Greek Diaspora can have on the local technology entrepreneurship, and of the decade-long experience that Kostas Mallios brings to the table. He himself believes in the power of ideas and in every person’s potential to make a difference. His experience in business creation and expansion extends over the fields of research and product and business development, mergers and acquisitions. He was Vice President at Intellectual Ventures, and he spent fifteen years in Microsoft assuming a number of executive positions. He holds an MBA in Business Administration and Technology Management from Rensselaer Polytechnic Institute and a Bsc in Marketing Management from Siena College.
Kostas Mallios takes us back to 2011. “At that time, in Greece there was no money for entrepreneurs, and I wanted to start an angel fund or a seed fund. They all wanted to talk about it due to my experience with Microsoft, but in the end, nobody wanted to invest money.” An incentive was created through the financing from the European JEREMIE funds. However, when PJ Tech Catalyst of Piraeus Bank was built in 2012, Kostas Mallios found out, through his partcipation in its investment team, that the Greek ecosystem was still immature. “They used to ask for money in the form of subsidies. They asked for three years of salary and then wait for the next subsidy. There were neither good advisors nor good entrepreneurs. We had no deal flow. It was like putting up a tent on the desert, and waiting for someone to pass by.”
After nearly a decade, the difference in relation to the present picture is striking. After the financial crisis, there has been a major change in culture. The immature companies, which were not supposed to receive funds, have now closed down. There are now consecutive financing rounds for other companies. Six months ago, I was involved or I participated in 2 out of the 3 largest acquisitions of the innovation ecosystem in Greek history. Now, six months later, the scene is completely different. That was exactly our goal.”
“I heard that Amazo Web Services opens an office in Athens,” he says enthusiastically. “The way the big technology players see us has completely changed. We have offices in Athens and in Thessaloniki, we have Think Silicon in Patras, and we are hiring. “There is a Growth Wheel that has been built. However, it is fragile and we have to consider what its needs are in order to keep going.”
Kostas Mallios underlines that the government still plays a central role in the local entrepreneurship, and this is not necessarily positive. “Every time the government changes, the country’s brand changes as well,” he says. “In order for an investor to invest their money, they need stability. Unfortunately, there have been numerous changes in the entrepreneurship ecosystem in the past few years. Greece has no steady-state fiscal environment. Especially with regard to laws with a retroactive effect, I remember myself saying “it is better to burn the country and start over,” because no investor will stay in Greece, if they are asked to pay taxes that have been imposed retroactively.”
At the same time, he finds out that “closing the society and the economy did not help.”With the exception of some industries such as shipping, “we did not want to be competitive on other fields globally. We were active only in the Balkans.” This changes and it is important, as the internet provides huge potential. “I spent three months in Greece last summer. This change brought about by remote working is a golden opportunity for anybody who would like to work here. Who would like to be in London in the winter months? Greece has to take advantage of the new future of work.”
Kostas Mallios points out that the existence of “tech talent” in the market is the most important precondition for the growth of the ecosystem. “The next thing is the cost for the infrastructure per person. In any case, the political and the regulatory costs are not insignificant. You do not get involved easily with the public sector, you think twice about it, especially if you have come back from abroad and you do not have the means to deal with it effectively, as Greek entrepreneurs can do because they know their way around.”
Back to talent again, Kostas Mallios believes that the Greek government should adopt a more active policy so as to attract talent from foreign countries. “As I am recruiting, I know that I have ‘hit’ the entire market. I’m looking for highly specialized individuals and a lot of technicians with expertise. In Greece, there are hundreds of high- ly-qualified people, but not the thousands you need for the growth of the ecosystem. We could bring talent from other European countries. We did it, we brought 4 people from Norway and Germany. In order to attract them, we provided our employees with very good salaries, benefits, cars. We wanted to show them that they are working in a first-in-class global environment.” The emotional attachment with Greece is a very significant tool to attract talent. “Migrants like me, who have lived in Australia and in Germany, are the first ones to be approached and persuaded to come back.”
“The importance of the human networks cannot be stressed enough. Greece’s network can be our number one asset,” he underlines. He puts special emphasis on method and the collective effort of building a community that maintains a connection with Greece by means of a special event, such as an international conference, or targeted trips of “leisure and work” aimed at presenting the ecosystem to visitors from foreign countries.
“The Delphi Economic Forum was a very good example, with first-in-class panels. In the same line of thought, I have built a large network with people I met at TED. Of course, in events, such as TED, people only talk. Cooperations arise on the sidelines of an event. One has to know when the right time is,” he adds.
The follow-up of a certain event is also important. He suggests that there should be “satellite events” in a number of different places on the world. “Such events help the network expand and increase participant interaction. In this way, relationships between intelligent people are formed, who will find common ground and will look for the right person in their community or the necessary funding. One has to know their contacts and should have a proposal of value. Everybody wants to make a good deal. If a company is looking for funds, sending an email to a member of this network is enough in order to explore if somebody is interested in investing.”
“Everything is a matter of personal relations and one has to make a start. One has to find people who would like to give something back to the country, and have a little benefit from it themselves. I brought a team of VCs in Lefkada. We had a wonderful time and since then there has been a group interacting through WhatsApp. They saw a beautiful side of Greece, they developed ties with the country. If you bring people together, then after a couple of years something comes out of it.”