The Emerging Turkish Tech Sector and Promising US- Turkey Collabora;ons

Transcription

1 The Emerging Turkish Tech Sector and Promising US- Turkey Collabora;ons Prepared for: American Turkish Council 34 th annual conference Presented by: Patrick L. Anderson CEO, Anderson Economic Group 2015, Anderson Economic Group, LLC

2 Outline I. IntroducHon to Anderson Economic Group II. The Emerging Turkish Technology Sector III. US- Turkey CollaboraHon OpportuniHes IV. Promising Tech Companies to Watch V. Conclusions

3 I. Introduc;on to Anderson Economic Group

4 I. Intro to Anderson Economic Group Anderson Economic Group is a bouhque consulhng firm specializing in economic advisory, strategy consulhng, and industry research. The company has offices in East Lansing, Chicago, and Istanbul. Our work in Turkey and the US is based on deep industry knowledge, and on relahonships with large companies and important inshtuhons, such as investment and development agencies, ministries and departments of governments, and trade associahons. Anderson Economic Group experts provide strategy and management consulhng services for market entry and expansion. Select annual publicahons from AEG have become nahonal standards in the US. AEG is a member of the Turkish American Business Associa6on, the American Chamber in Turkey; and the Michigan Chamber of Commerce.

5 I. Intro to Anderson Economic Group Some Representa6ve Clients of Anderson Economic Group:

6 II. The Emerging Turkish Technology Sector

7 II. The Emerging Turkish Technology Sector A. The Opportunity Emerging Opportuni;es Sectors with significant opportunity to take advantage of both US and Turkish tech sectors include: Defense Consumer products CommunicaHons LogisHcs Other sectors These opportuni6es emerge from both US and Turkish advantages, as well as the ability to trade between these na6ons and invest across borders.

8 II. The Emerging Turkish Technology Sector B. Advantages for Turkey and the US US Advantages in High- Tech Industries Worldwide tech leadership, especially in communicahons and consumer- facing entertainment, infotainment, and similar applicahons The largest economy in the world, and the most advanced in terms of technology integrahon across all sectors Open economy; relahvely good IP protechon Headquarters for many global brands Disadvantages include: A labor shortage for some skilled occupa6ons; High costs (par6cularly in Silicon Valley); and Excessive focus on trendy technology

9 II. The Emerging Turkish Technology Sector Turkish Advantages in High- Tech Industries Under- appreciated tech capability Good produchon of workers skilled in math and science LocaHon; proximity to markets; proximity to produchve talent in other countries Reasonable costs Rule of law tradihon Historic role of Istanbul as a trading center Disadvantages include: Weaker EU- style patent protec6on Unfamiliarity among US tech companies and investors Less experience in tech promo6on though catching up fast

10 II. The Emerging Turkish Technology Sector C. Unique Aspects of Turkey & US: Role of Culture Culture MaEers Studies of technology hubs in the US, and in other parts of the world, demonstrate that culture, economic freedom, and government policies ma`er. We highlight two important elements of culture that provide advantages to the US and Turkey. 1. Benefits of a rela6vely open society The relahvely open American economy, and its support (and somehmes celebrahon) of the entrepreneur and the inventor are clearly crihcal elements in US success. The relahvely open Turkish culture and historic regional Hes throughout central Europe and Asia already provide Turkey with a similar advantage in its region of the world.

11 II. The Emerging Turkish Technology Sector Many US breakthroughs in technology and world- changing companies have arisen from immigrants from other countries: Steve Jobs: Co- founder of Apple Computer Inc.; born to Syrian and American parents Amar Bose: Founder/Chairman of Bose CorporaHon; born to Indian and American parents Sergey Brin: Co- founder of Google; born to Russian parents in Moscow Alexander Graham Bell: American inventor and entrepreneur who founded numerous companies related to sound and the telephone; born in Edinburgh, Scotland Henry Ford: Industrialist and founder of Ford Motor Company; born in County Cork, Ireland Ahmet Ertegun: Founder and president of AtlanHc Records, Co- founder of New York Cosmos soccer team, Chairman of the American Turkish Society; born in Istanbul, Turkey

12 II. The Emerging Turkish Technology Sector 2. Importance of Financing Emerging Companies Nearly all emerging companies face serious financing constraints; ability to finance start ups is a crihcal aspect of the technology industry. The US has an extensive venture capital network, especially in tech- friendly areas; as well as angel investors and incubators that assist start- ups. US laws (even with the Jobs Act ) are shll prohibihve regarding stock offerings for most firms; many investments cannot be offered except to accredited investors. Turkey s Borsa Istanbul is a world leader in financing for SME companies; arguable in front of the US even with the Jobs Act. The Borsa s Emerging Companies Market is a model for other countries.

13 III. US- Turkey Collabora;on Opportuni;es

14 III. US- Turkey CollaboraHon OpportuniHes A. Key Industries that Can Benefit 1. Defense, Intelligence, and Cyber- warfare CommunicaHons, network, and analyhcs somware have become the front lines for many low- intensity conflicts around the globe. Risk assessment technology is shll underdeveloped, even in the US. 2. Communica;ons; Marke;ng The tradihonal communicahons industry has transformed significantly. Web- based markehng (and loyalty programs) omen rely on relahvely primihve analyhcs; even modest improvement can pay large dividends. 3. Data Analy;cs; Business Management The digital economy produces huge amounts of data, much of it unused; some of that data can be extremely useful. Data analyhcs is a rapidly growing field, with more transformahon coming.

15 III. US- Turkey CollaboraHon OpportuniHes Key Industries, con6nued: 4. Consumer Products; Tradi;onal and Digital A large share of consumer products now involve some communicahons technology. Improving this technology (including making it more difficult to hack, easier to use, more reliable, and less intrusive) provides a compehhve advantage. 5. Logis;cs Inventory management; supply- chain management; and financial management are all crihcal costs (and potenhal compehhve advantages).

16 III. US- Turkey CollaboraHon OpportuniHes B. Major Tech Centers and the Role of Incubators Major Tech Centers in the US and Turkey Technology centers in the US are based in an idenhfiable set of US cihes and metro regions. It is a mistake to assume most technology employment, or innovahon, occurs in Silicon Valley. Incubators play a major role in encouraging tech in the US. Istanbul is emerging as a tech center in its region of the world.

17 III. US- Turkey CollaboraHon OpportuniHes Loca;ons of Major Technology Centers in the US Source: Anderson Economic Group, Automa6on Alley s Annual Technology Industry Report,

18 III. US- Turkey CollaboraHon OpportuniHes Tech Industry Employment in US Hubs Source: Anderson Economic Group, Automa6on Alley s Annual Technology Industry Report, base data from US Census Bureau; defini6ons from AEG.

19 III. US- Turkey CollaboraHon OpportuniHes Incubators in the US Automa;on Alley: a technology business associahon and business accelerator dedicated to growing the economy of Southeast Michigan. Spark: an organizahon in Ann Arbor, Michigan, that supports early- stage companies. LEAP: a coalihon in the Lansing, Michigan area commi`ed to building a prosperous region by helping entrepreneurs start new businesses. 1871: a Chicago- based entrepreneurial hub for digital startups, consishng of designers, engineers and entrepreneurs who are looking to share ideas and build their businesses. Incubators in Turkey Istanbul Technical University, Yildiz Teknopark, Ozyegin University; Start- Up Istanbul event; others (Note that use of terms such as incubator and the organiza6onal missions of Turkish suppor6ng en66es o^en differ from those in the US.)

20 IV. Promising Tech Companies to Watch

21 I V. P r o m i s i n g T e c h C o m p a n i e s t o W a t c h Turkey- Based Firms (most headquartered in Istanbul): AppAnaly;cs: a mobile analyhcs soluhon that allows web operators to increase sales by measuring and tracking users mobile experience. GullsEye: a terminal operahng system somware that accelerates container, cargo, and warehouse service processes in ports. Repzone: a cloud- based sales force plaporm offering predichve analyhcs and enhanced collaborahon capabilihes. Segmen;fy: a SaaS soluhon for e- commerce that helps convert visitors to customers through smart recommendahons. SESTEK: a provider of speech- enabling soluhons such as voice biometrics, call steering, text- to- speech and speech analyhcs.

22 IV. Promising Tech Companies to Watch US- Based Firms (both headquartered in Michigan): IDV Solu;ons produces risk assessment tools that are increasingly useful for governments and large organizahons; provides the industry- leading visual command center for risk awareness. Supported Intelligence LLC produces powerful analyhcal tools that provide risk analysis, decision analyhcs, and network ophmizahon; its licensable somware is based on the first- in- the- world, patent- pending Rapid Recursive technology.

23 V. Conclusions

24 V. Conclusions 1. Opportuni;es Exist Don t Miss Them There is a tremendous opportunity to make use of emerging tech companies, who have developed innovahve processes and technology that can be licensed and developed by larger firms. These opportunihes are not just for consumer electronics; they exist in defense, communicahons, logishcs, business management, and services.

25 V. Conclusions 2. Look at Tech Hubs Across the US and in Turkey You can find these firms in a number of tech hubs, including: Istanbul Chicago, Illinois Detroit, Michigan Minneapolis, Minnesota AusHn, Texas San Jose, California

26 V. Conclusions 3. Consider Advantages in Other Areas; Incubators Can Help Silicon Valley is shll the world leader in technology produchon, but compehtors have arisen that have advantages of: Much lower costs. Much more accessible entrepreneurs. Aggressive incubator and technology promohon agencies. Incubators such as I871 (Chicago), AutomaHon Alley (Detroit), and various universihes in Turkey are very helpful in these other hubs.

27 V. Conclusions 4. Consider Business Prac;ces Carefully There are differences in business prachces between small firms and large firms. Be aware of these differences. ConHnue to do business with well- established firms when business requirements demand it. Take into account the managerial and financial challenges of emerging companies when you want to access new technology emerging from these firms. Consider licensing technology, even on a short- term basis, to see if it works with your products and services.

28 V. Conclusions 5. Look to the Future Technology is an under- appreciated area of alignment between the US and Turkey. US and Turkish culture, as well as educated workforce and technical resources, provide a sustainable advantage to both countries and one that provides great potenhal for future collaborahon and success.

29 Thank you! Patrick Anderson Ilhan Geckil East Lansing 1555 Watertower Place Suite 100 East Lansing, Michigan Phone: (517) Chicago 20 S. Clark Street Suite 2110 Chicago, Illinois Phone: (312) Istanbul Bağdat Caddesi No:67/6 Kızıltoprak/Kadıköy İstanbul Turkey Phone: Anderson Economic Group, LLC 2015