Strategies of the Development of Entrepreneurship and SME

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Greek VC market started to develop after 1997. Since then, Greek government has madeseveral attempts -for instance, the national legislation has been amended and CSF, whichprovides a large part of funding and simplified procedures for SMEs in order to reduce theadministrative burden and to handle more effectively the increasing participation of SMEs- toprovide incentives for the growth of the VC industry and to set a Regulatory Framework thatwill promote the smooth operation of the market. A legal framework was established in Greece,with the enforcement of Law 1775/88, which introduced the Venture Capital Provision Firms(EPEK). With Law 2367/1995, the first law was amended in order to support the developmentof VC and PE market as well as EPEK was renamed with Venture Capital Firms (EKES). To boostthe VC Industry, a new legislative regulation was introduced in 2002, by Law 2992/2002 andalso paved a way for the establishment of AKES which is a closed-end VC mutual fund, formedas a partnership. Lastly, Law 568/2005 was enacted to foresees the establishment of theDigital Leap Fund, which is a State sponsored VC fund and aims at facilitating entrepreneurshipand the development of new businesses, by financing with € 100 million either ICT businessstart-ups or ICT-related business start-ups.Private VC started to emerge -either as affiliates to large banks or as initiatives of financinginstitutions-, commercial banks began to act as intermediaries from the Operational Programsto SMEs and micro-enterprises. Al least 14 organizations are directly/indirectly engaged withfinancing start-ups. One of them is TANEO -Fund of Funds, in which the only investor wasGreek government, but later on, the fund also raised private capital-, whose aim is the minorityparticipation in closed-end Venture Capital Funds (AKES), Venture Capital Companies (EKES)and similar VC organizations (Overview,2007). TANEO focuses on providing support forknowledge-based, technology intensive and innovative activities. The full utilization of TANEO’spotential will start in the forthcoming funding period and it is expected to act as a contact linkbetween Greek and foreign enterprises. The fund’s budget stands at 150 million €, of which 45million € is public contribution and it is intended to be transferred in the 4 th CSF. Another one isCredit Guarantee Fund of Small and Very Small Enterprises (TEMPME) that is fully operationalwith an equity capital of approximately 250 million €, 33% of which is public expenditure. Ithelps SME’S (with up to 30 employees) to gain access to credit and until February 2007 1857SME’S have received credit of total budget of 44.99 million Euros. These two funds will becomemore specialized during the forthcoming planning period 2007-2013.With an aim to providenew flexible funding mechanisms for SMEs, the establishment of VC Funds, Seed Capital Funds,and Business Angels is being promoted. Particular emphasis is placed on providing indirectsupport to innovative SMEs in the trade and services sectors and to new businesses emergingfrom the utilization of research output. Moreover, support for spin off companies are providedthrough a pre-seed funding scheme (PRAXE A), according to which, individuals can submitproposals for scooping a new idea and developing a business plan and financing a maturebusiness plan, through the scheme PRAXE B.Greece has a relatively favorable legal and tax environment for the development of theVC since the Greek VC ranks in the upper half of the European classification in BenchmarkingEuropean Tax and Legal Environment (2006); and holds a satisfactory position in terms of howeasily accessible funding is for enterprises; and the degree of support that banks offer toenterprises in terms of banking and financial services. However, the sector has not achievedsufficient maturity in terms of VC and Private Equity (PE). “Taking into account the PrivateEquity investment as percentage of GDP, Greece is ranked in the nineteenth position amongthe EU countries for 2005, far below the European average” (Overview, 2007). For instance,Greece is ranked in the lower places among the EU countries regarding the amount of VCinvestments in high-tech sectors. The details and availability of VC investments can be seenbelow:124
Venture Capital Investments (2006, Total)Table 28.SectorInvestedCapital in 2006(in thousand€)Number ofinvestments2006Total investedCapital (inthousand €)Total numberofinvestmentsSoftware,hardware, 1030 3 52.967,69 31internetCommunication 1570 2 25.223,57 10Electronics 900 2 4.900,00 3Biotechnology 145,5 1 3.145,50 2Medical devices 4500 2 14.280,50 7Pharmaceutics 0 0 14.759,14 4Food 4000 2 31.870,60 14Services 9150 2 34.859,57 13Other 25330 6 122.991,70 41Total 46625,5 20 304.998,30 125Source: Overview, 20076.1.4. Tasks for improvement and future development of the Greec SME sectorPromotion of specific financial tools and funds to support new entrepreneurs shall bedeveloped as the funding problem appears for entrepreneurs who seek funding in excess of150,000 €.Special attention must be given to encourage the development of the so-called microenterprises such as: handicrafts, firms with less than 5 employees in every sector of themarket, being: production, services, tourism, etc.The lack of mobilization is the weakest element in the innovation–research andtechnology system, and reflects general structural weaknesses in the production base, e.g.small enterprises, traditional branches, extremely limited workforce in fields generatingtechnological innovation, technological transfer, in-house development, lack of high-levelscientific staff in enterprises, risk prevention.Although courses are being held for further training of teachers who will teachentrepreneurship in technical schools and institutions for vocational training, these measuresstill need to be developed in this area as they are still sporadic.Creation of a favorable environment through a process of collaboration of government bodies,enterprises, teaching, and research institutes in order to upgrade the quality of variousspecialized programs need to be accelerated.Clusters’ links and collaborations with local educational and research institutes shall bedeveloped to upgrade quality and create specialized programs addressing cluster needs.Demand for engineers, scientific executives, and ICT specialists, is expected to risesignificantly in the following years, there is need to develop links between universities andbusiness to satisfy these needs.Although a law was adopted on life-long learning, which is expected to systematize theexisting frameworks for education and training, there is still need to improve measures to betaken to respond to the challenges of life-learning.125
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1. SME DECLARATION AND WORKING GROU
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While comparing the BSEC and EU doc
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cooperation with the United Nations
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GENERAL ASSESSMENT OF THE BSEC WG O
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“Armenia's new law introduces a n
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(iii)Share of the labor force of SM
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The following data represents some
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RankDocuments for export(number)Tra
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• Industrial zones/Business incub
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3.1.4. FINANCING SMEsProf. Dr. Sela
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• the loan is secured with movabl
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3.1.4.3. Mutual and loan guarantee
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introduction of e-signatures, only
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The Code of Conduct for Civil Serva
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Trading Across Borders Enforcing Co
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as with all non-governmental organi
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Bulgarian SMEs obtain additional ca
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• Project BG 2004/016-711.11.04 -
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usiness is not approaching them oft
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• Romanian citizens are recognize
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The preparatory project of the NDP
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• To support participation in eco
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In 2004, the National Institute of
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Incubators host on average 11 SME,
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Programs. The program is implemente
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development instrument is extremely
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accounting standards, including med
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corporations and open held corporat
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promoting SME sector, cooperation w
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• for unemployed (micro credit)
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are private pension funds, broker h
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very early steps of its democratic
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Another negative factor that is mor
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economy. The so called in the organ
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Federal funds, private capital, esp
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Page 78 and 79: Technological:Internetaccessibility
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Page 82 and 83: international investments• Govern
Page 84 and 85: 3. Hamel, G., Prahalad, C.K. (1994)
Page 86 and 87: 5.2 DEVELOPMENT OF THE SME SECTOR I
Page 88 and 89: General Characteristic of SME Devel
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Page 96 and 97: 5 million was provided by UNDP and
Page 98 and 99: 5.3 DEVELOPMENT OF THE SME SECTOR I
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Page 110 and 111: General situation of credit marketT
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Page 116 and 117: Table. 32.Ease of businessDoingBusi
Page 118 and 119: people who start small businesses t
Page 120 and 121: are salaried and the medium - sized
Page 122 and 123: Technology Foresight in Greece 2001
Page 126 and 127: In the area of bankruptcy and restr
Page 128 and 129: enterprises. According to TURKSTAT,
Page 130 and 131: small size enterprise or micro ente
Page 132 and 133: industrial enterprises. Undersecret
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Page 136 and 137: 7. SUGGESTIONS FOR THE SME DEVELOPM
Page 138 and 139: Annex 1.MAP OF THE BLACK SEA COUNTR
Page 140 and 141: 17-18 June 2005 1 st Moscow Interna
Page 142 and 143: ARMENIASTRENGTHS• Application of
Page 144 and 145: BULGARIASTRENGHT• Flexibility and
Page 146 and 147: GREECESTRENGHT• They have a vital
Page 148 and 149: ROMANIASTRENGHTWEAKNESS• Stabilis
Page 150 and 151: REPUBLIC OF SERBIASTRENGHT• Longe
Page 152 and 153: UKRAINESTRENGTHS• Well educated l
Page 154 and 155: In compliance with the Resolution m
Page 156 and 157: 1. Please provide definition of SME
Page 158 and 159: 7. Did you establish a dedicated bo
Page 160: 11. Do you have any suggestions for
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