OECD has just released its telecommunications report and here’s a bit that should surprise no one living in Turkey.
As I watch the campaigns for the upcoming elections (which look to be critical in that the results will determine if the current polarization of the country will continue), I hear very little from the politicians in how they will focus on the added-value Turkey generates in its economy. Information technology is a relatively small part of the Turkish economy, but knowing that the high price of telecommunications is largely due to taxes, it’s discouraging to see that we are now at the bottom of the list.
Category Archives: Turkey
Mondus in Hürriyet
Mondus was featured in an article by Batuhan Okur in his biweekly column in Hürriyet (in Turkish), Turkey’s largest daily. Okur understands Mondus and our ambitions around it well. He commented (as translated by me from Turkish):
Privacy controls are very important for Mondus, which allows users to define the groups they belong to and communicate within them. This way, no matter how big Mondus gets, the existing users will not be bothered and diluted by the growth.
…
The best outcome of this approach will be the accuracy of user data. This kind of accuracy breeds trust and makes Mondus a strong candidate to become a viable social platform. The founders think it’s a strong advantage for Mondus against its competitors.
Erem Karabey Moves on from Google Turkey
Erem Karabey, Google Turkey’s GM, has resigned from his post. I have known Erem a long time and think his departure is a loss for both Google and the Turkish internet community. I wish him good luck in his endeavors.
UPDATE: Here’s Webrazzi‘s report on it (in Turkish).
HeliSkiing in the Kackars
I had heard about how wonderful heliskiing is from a few good friends who’ve done it before and have been following Fabrice Grinda’s writing on it, but I had no idea that the experience would be this amazing.
I got the opportunity to join a group of friends for a weekend of heliskiing in the Kackar mountain range in the Eastern Black Sea region of Turkey. We were not terribly lucky about the weather, and on Sunday, the only day we got to fly, I learned that there is such a thing as "too much snow" (4-6 meters base, 1-2 meters powder), but the little I got to ski, espceially higher up in the mountains, was incomparable to anything I have experienced in my 30 years of skiing.
The outfit Turkey HeliSki is a 3 year-old operation and they do an amazing job. A friend warned me before I left that I was about to take a very expensive step and he was right. I am getting ready to book next year’s trip.
PS. that’s my friend Refik in the pic who was skiing with a seperate group, since no one in our group took a camera up 🙂
Israel Envy
According to the IVC, Israel has:
4,563 High-Tech Companies, 166 VC Funds and 34 Incubators
Country PR aside, it’s serious that Israeli VC funds have raised $1.2 billion in 2005, and are projected to raise another $1b in 2006. Therefore, it should not be surprising to see events like KinnerNet conference, pulling in about 150 thinkers and innovators to:
discuss topics and concepts that are of interest
to them,in fields such as Software development, internet culture, site
building, blogs, forums, social networks, chat rooms, instant messages,
P2P, search engines, web services, Wi-Fi, open source, Email,
Infrastructure services, Cellular services, Computer games, Interactive
T.V, VOIP, technological trends, Gadgets, Security and more, to share
their thoughts , work-in-progress, show off the latest tech toys and
hardware hacks, and tackle challenging problems. together we will try
to figure where the internet is going and what are the prevailing
trends.
I am jealous as I read Mark, Tom and Loic blog about it. In contrast to the Israeli numbers, the Turkish VC raised in 2005 was $0. In 2006, we expect it to be $0 again. And, we will not have an event like this next year in Istanbul.
A few months ago, on a panel, Yigal Ehrlich had attributed Israel’s VC (and innovation) success to government action – resulting in Yozma. As much as I hate looking towards the government (especially the Turkish government), I suspect early stage VC asset class can only be kick-started with a strong nod from the government.
Turkven Invests in Pronet
Turkven, Turkey’s only independent private equity firm, announced its investment in Pronet on Monday. The Turkven team and the CEO of Pronet are both friends. To top it off, another friend, Aycan Avci advised Pronet on the deal. Pronet’s been an ideal candidate for PE for a while – enjoying rapid growth with a very visible cash stream.
This is Turkven’s sixth closing on its debut fund. In a panel last week, Evren Unver mentioned that work’s about to begin on the second fund.
Sometimes, I feel like the entire deal scene in Turkey is rooting for the success of Turkven. I am excited for them.
MIT – Sloan Visit to Istanbul
Ken Morse, the Managing Director of MIT Entrepreneurship Center, accompanied a group of Sloan Students to Turkey. In Istanbul, they were hosted by the ARI Teknokent, the technopark project of the Istanbul Technical University. I was invited to be a panelist yesterday in a panel discussion titled, "Istanbul: A Globally-Linked "Cool" Hub for Entrepreneurship?" The panel was moderated by Memduh Karakullukcu, the General Manager of ARI Teknokent. The other panelists were:
Aydin Ersoz – CEO of Innova, a leading Turkish enterprise software developer
Cemil Turun – CEO of Yogurt, an innovative software house with a focus on computer graphics
Evren Unver – General Partner at Turkven, Turkey’s only independent private equity fund
We took turns sharing with the audience our view and experiences in entrepreneurship in Turkey. The summary of the discussion, along with the previous night’s dinner’s topics with Ken Morse, is that Turkey has inherited an entrepreneurial legacy, with Istanbul as the hub of commercial activity in the region for centuries, and right now, economic stabilization, lower interest rates, and the EU ascension plans combine to make Turkey a desirable target for capital.
The picture is fairly clear. All stakeholders seem to agree on the main points. Therefore, we should expect a big boom in entrepreneurial activity in Turkey, right? 🙂
We’ll see…
Two pieces of exciting news from yesterday were that Turkven has closed another deal, bringing their investments to five, and that Innova is contemplating a Turkish IPO.
Podcasting and Videocasting Enter Turkish Media
In a move that’s definitely ahead of the curve, CNN Turk, has made all of its original programming available as free podcasts and videocasts. I was pointed to this by Altan Alpay, the CEO of Podvertiser, who blogged about it yesterday. CNN Turk is a JV between CNN International and Dogan Media Group, Turkey’s dominant media conglomerate. There are further details on the initiative on the CNN Turk website (in Turkish). I see this as the first signal of the forward-leaning stance for Dogan’s traditional media channels.
Valuations
Yesterday, the Turkish government pulled off an impressive feat by auctioning off its controlling (51%) share of the refinery group, Tupras, for the unexpectedly high price of $4.14b, which implies a market capitalization of $8.11b. The winner is the Koc-Shell consortium. The auction’s high price was surprising, especially given that the company was sold last year, in a similar auction that was later canceled by the courts, for a quarter of this amount. Not surprisingly, yesterday’s auction has been met with enthusiasm by the Istanbul Stock Exchange, Turkish business circles and the press, who have called Tupras Turkey’s "diamond".
What has had me thinking is that Tupras’s sale has coincided with two other pieces of M&A news that are closer to my industry:
1) eBay buying Skype for $2.6b
2) Oracle buying Siebel for $5.85b (both links from NYT; require free subscription)
Notice the figures? 2.6 plus 5.85 equals 8.45 which is greater than 8.11. in other words, the crown jewel of Turkish economy, a 75+ year company, selling for a market-shattering price in a highly-contested auction, is worth less than the combination of a 12 year-old software company and a 2-year old telecommunications company.
The implications are complex. It makes me feel that I am here at the right time, but makes me wonder if I am at the right place.
Cem Sertoglu 