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On Entrepreneurship in Turkey
Ziya G. Boyacigiller
This presentation was created and given by Ziya
Boyacigiller who was le...
Entrepreneurship in
Turkey?
Entrepreneurship /
Intrapreneurship circa 2008
Ziya G. Boyacıgiller
Sabanci University
Ziya G. Boyacigiller (c) 2005
EMBA 4
Entrepreneurship won’t
work in Turkey…
 Whatever works in USA won’t work here…
 No ...
Ziya G. Boyacigiller (c) 2005
EMBA 5
A Question?
 How did the following companies start
and become successful in Turkey?
...
Ziya G. Boyacigiller (c) 2005
EMBA 6
… it is easy to be
an entrepreneur
in the US?
And who says…
Ziya G. Boyacigiller (c) 2005
EMBA 7
Spin-Off Companies…
 In 2000, there were 454 spinoffs, within all American academic
...
Why does one
become an
entrepreneur?
money
excitement
power
fame
work
social contribution
knowledge
competition
Ziya G. Boyacigiller (c) 2005
EMBA 9
Top 10 US Billionaires
Name Age Worth Company
Bill Gates 48 $48B Microsoft
Warren Buf...
Ziya G. Boyacigiller (c) 2005
EMBA 11
Example for Good VC
Investments:
KP’s star companies:
 Google 240x
 Netscape: 80x
...
Ziya G. Boyacigiller (c) 2005
EMBA 12
Returns of VC Companies
Kleiner
Perkins
Caufield &
Byers
IRR Sequoia IRR Matrix
Part...
Ziya G. Boyacigiller (c) 2005
EMBA 13
Global VC Investments
1998-2002
Region Invest Funds Raised Not-
Committed
$ Billion ...
Ziya G. Boyacigiller (c) 2005
EMBA 14
Favored Industries?
Source: pwcmoneytree.com 2004
VC Yatirimlari ve Endustrilerin Da...
Ziya G. Boyacigiller (c) 2005
EMBA 15
10 Top Countries
Region Investment
2000 2002
US $105B $62.7B
UK $9.6B
France $1.1B $...
Ziya G. Boyacigiller (c) 2005
EMBA 16
How can China run?
 What has changed in China…
 In the last 5 years IDG Technology...
Ziya G. Boyacigiller (c) 2005
EMBA 17
What is changing in Turkey?
 EU forcing structural changes
 Economic reforms (IMF)...
Ziya G. Boyacigiller (c) 2005
EMBA 18
Entrepreneurship is a
Strong Driver of Economy
 Approximately 4% of US labor force ...
Ziya G. Boyacigiller (c) 2005
EMBA 19
Additionally “creative destruction”
is at work; very few Fortune 500
companies stay ...
Ziya G. Boyacigiller (c) 2005
EMBA 20
Microsoft, Apple Computer
Ziya G. Boyacigiller (c) 2005
EMBA 21
Walmart, Target
Ziya G. Boyacigiller (c) 2005
EMBA 25
Dr. Edward Demings’
Famous Beads Experiment
The output of a process produces both
ra...
Ziya G. Boyacigiller (c) 2005
EMBA 26
Nature of Growing and
Aging
Ziya G. Boyacigiller (c) 2005
EMBA 27
Corporate Lifecycles
Ziya G. Boyacigiller (c) 2005
EMBA 33
Obviously, something
separates successful
entrepreneurs (inside or
outside companies...
Ziya G. Boyacigiller (c) 2005
EMBA 44
Tell a Story…
Narrative stories overcome these issues:
1. Set the stage
(who are the...
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Entrepreneurship in Turkey

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Entrepreneurship in Turkey

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Entrepreneurship in Turkey

  1. 1. On Entrepreneurship in Turkey Ziya G. Boyacigiller This presentation was created and given by Ziya Boyacigiller who was leading Angel Investor and a loved mentor to many young entrepreneurs in Turkey. We have shared it on the web for everyone’s benefit. It is free to use but please cite Ziya Boyacigiller as the source when you use any part of this presentation. For more about Ziya Boyacigiller’s contributions to the start-up Ecosystem of Turkey, please go to www.ziyaboyacigiller.com
  2. 2. Entrepreneurship in Turkey? Entrepreneurship / Intrapreneurship circa 2008 Ziya G. Boyacıgiller Sabanci University
  3. 3. Ziya G. Boyacigiller (c) 2005 EMBA 4 Entrepreneurship won’t work in Turkey…  Whatever works in USA won’t work here…  No one will invest here in a new business…  Holdings will destroy you once your business becomes significant enough…  There is no legal protection, intellectual property rights…  They will copy you, all your efforts will go to waste…  Government will back their supporters, will damage you if you don’t work with them…  You can’t overcome the government bureaucracy…  When there is corruption, the mafia you can’t be in business honestly…  If you are a minority partner, they will cheat you…  etc…
  4. 4. Ziya G. Boyacigiller (c) 2005 EMBA 5 A Question?  How did the following companies start and become successful in Turkey?  Hedef Alliance?  Dizayn Group?  Mavi Jeans?  Logo Yazilim?  Gantek?  Artesis?  AirTies  ….
  5. 5. Ziya G. Boyacigiller (c) 2005 EMBA 6 … it is easy to be an entrepreneur in the US? And who says…
  6. 6. Ziya G. Boyacigiller (c) 2005 EMBA 7 Spin-Off Companies…  In 2000, there were 454 spinoffs, within all American academic institutions, pp57  In 2000, average was 4.2% spinoffs-to-disclosures ratio within 26 selected universities (~37% of total with spinoffs) in USA. Pp68  During 1980-1996, MIT spinoffs = 134, went public = 24, 18% public “spin-off ratio, pp19 & pp30  Using 4.2% and 18%, we get 0.3%. This means only 3 spinoffs for each 1,000 disclosures succeed to go public (IPO). (Note that this ratio is for MIT and is much higher than non- academic success rates. However, the rate for VC backed companies is 100 times worse!)  Moreover, during 1980-1996, average years to IPO for 24 MIT spinoffs equaled 4.5 pp30
  7. 7. Why does one become an entrepreneur? money excitement power fame work social contribution knowledge competition
  8. 8. Ziya G. Boyacigiller (c) 2005 EMBA 9 Top 10 US Billionaires Name Age Worth Company Bill Gates 48 $48B Microsoft Warren Buffet 74 $41B Berkshire Hathaway Paul Allen 51 $20B Microsoft Alice Walton 55 $18B Wal-Mart Helen Walton 85 $18B Wal-Mart Jim Walton 56 $18B Wal-Mart John Walton 58 $18B Wal-Mart S. Robson Walton 60 $18B Wal-Mart Michael Dell 39 $14B Dell Larry Allison 60 $14B Oracle Source: 2004 Forbes 400
  9. 9. Ziya G. Boyacigiller (c) 2005 EMBA 11 Example for Good VC Investments: KP’s star companies:  Google 240x  Netscape: 80x  @home: 87x  Amazon.com: 44x  Exite: 73x  Rambus: 51x  Citrix : 40x
  10. 10. Ziya G. Boyacigiller (c) 2005 EMBA 12 Returns of VC Companies Kleiner Perkins Caufield & Byers IRR Sequoia IRR Matrix Partners IRR 1992 fund 39%/y 1992 fund 110%/y 1995 fund 223%/y 1994 fund 122%/y 1995 fund 175%/y 1997 fund 516%/y 1996 fund 287%/y 1998 fund 93%/y 2000 fund -30%/y 1999 fund -21%/y 1999 fund -5%/y 2001 fund -39%/y 2000 fund -16%/y 2000 fund -25%/y Source: Venture Scoreboard
  11. 11. Ziya G. Boyacigiller (c) 2005 EMBA 13 Global VC Investments 1998-2002 Region Invest Funds Raised Not- Committed $ Billion $ Billion $ Billion Global 660 788 128 North America 466 554 89 Western Europe 123 154 31 Asia Pacific 46 55 8 Middle East & Africa 11 12 1 Mid and South America 12 10 -3 Eastern Europe 2 3 1 Source: pwcmoneytree.com 2004
  12. 12. Ziya G. Boyacigiller (c) 2005 EMBA 14 Favored Industries? Source: pwcmoneytree.com 2004 VC Yatirimlari ve Endustrilerin Dagilimi 2004 $0 $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 $20,000 $22,000 S o ftw a re B iote c h T elcom N etw o rkin g M e d ica l S em ic o nd uc tor B u s ine ss pro du cts C o m p ute rsIT S ervice s Ind us tria l M e d ia/E n terta in m en t E lec tro nic s/Ins tr C o ns u m er p rod uc ts F in anc ialse rvic es H ea lth care s ervic es R e tailing /D is trib utio n Million$ 0 2 4 6 8 10 12 14 16 18 20 22 242000 2001 2002 2003 2004 2000/2003
  13. 13. Ziya G. Boyacigiller (c) 2005 EMBA 15 10 Top Countries Region Investment 2000 2002 US $105B $62.7B UK $9.6B France $1.1B $5.5B Italy $2.5B Japan $2.9B $2.4B Germany $1.2B $2.4B South Korea $0.1B $2.0B Netherlands $1.6B Canada $1.6B Sweden $0.6B $1.4B India $0.3B $1.1B China $0.1B $0.35B Source: UN Human Development Report, 2001 2003: US $18.2B Europe $3.0B Source: pwcmoneytree.com 2004
  14. 14. Ziya G. Boyacigiller (c) 2005 EMBA 16 How can China run?  What has changed in China…  In the last 5 years IDG Technology Venture Investing invested $170Mio with %43 IRR.  In 2004 record 253 companies received $1.3 billion.  Selecting investments fit for China’s economy and markets…
  15. 15. Ziya G. Boyacigiller (c) 2005 EMBA 17 What is changing in Turkey?  EU forcing structural changes  Economic reforms (IMF)  Government encouraging entrepreneurship  EU supporting entrepreneurship  Turkic and ex-soviet markets  EU and USA have difficulty working in Middle East  EU market opening up (customs union)
  16. 16. Ziya G. Boyacigiller (c) 2005 EMBA 18 Entrepreneurship is a Strong Driver of Economy  Approximately 4% of US labor force is involved in starting a new company every year.  Business owners in US is 13% of nonagricultural labor force.  All this, despite the odds – 40% of new businesses started in US live over a year, only 25% survive for 8 years.  Why is Nigeria the most entrepreneurial country?
  17. 17. Ziya G. Boyacigiller (c) 2005 EMBA 19 Additionally “creative destruction” is at work; very few Fortune 500 companies stay on the list for more than a decade or two. Corporate Entrepreneurship
  18. 18. Ziya G. Boyacigiller (c) 2005 EMBA 20 Microsoft, Apple Computer
  19. 19. Ziya G. Boyacigiller (c) 2005 EMBA 21 Walmart, Target
  20. 20. Ziya G. Boyacigiller (c) 2005 EMBA 25 Dr. Edward Demings’ Famous Beads Experiment The output of a process produces both random and systematic deviations. By replacing people or putting a gun at people’s heads it is not possible to reduce or eliminate either. Instead, you need to understand and eliminate the root-causes of the deviations.
  21. 21. Ziya G. Boyacigiller (c) 2005 EMBA 26 Nature of Growing and Aging
  22. 22. Ziya G. Boyacigiller (c) 2005 EMBA 27 Corporate Lifecycles
  23. 23. Ziya G. Boyacigiller (c) 2005 EMBA 33 Obviously, something separates successful entrepreneurs (inside or outside companies) from the masses of others…
  24. 24. Ziya G. Boyacigiller (c) 2005 EMBA 44 Tell a Story… Narrative stories overcome these issues: 1. Set the stage (who are the actors) 2. Define dramatic conflict (difficulties) 3. Resolution (how you win)

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