There was a ton of fallout as the Greek economic crisis worsened this week week and the country struggled to come up with answers to its growing predicament.
As Alexia Tsotsis explained in an article on TechCrunch earlier this week:
This week, the Syriza government failed in negotiations to receive a tranche of bailout money in time to make a $1.7 billion IMF payment on June 30th. Instead of deciding whether to accept the creditors’ offer himself, Prime Minister Alexis Tsipras put the decision to a referendum, or public vote, to be held this Sunday. Bear in mind that voting on fiscal matters is unconstitutional in Greece.
Greek startups felt the impact in a big way when capital controls put in place by the government prevented them from accessing cloud services outside the country. Specifically, the government prohibited any money transfers outside Greece without approval from a Ministry of Finance commission. That included, for example paying for infrastructure services like Amazon Web Services. One could argue that it was akin to the government shooting themselves in the foot, while tying the hands of these young companies.
One long-term solution to an economic crisis is looking to the entrepreneurs, those creative folks willing to take risks to chase the dream of turning their ideas into a viable company.
These companies when successful eventually generate jobs and the kind of economic activity a country like Greece desperately needs right now. If you set up obstacles to fragile startups, you are going to be in even more serious trouble.
And Greece is in a mess of trouble already.
Cloudy Future
The cloud combined with smartphones and advanced development platforms has given startups access to a range of resources. Before these existed, it was much more challenging to bring ideas to fruition, but cloud services make it possible for anyone with vision to turn that into a product in short order.
If an idea sticks, you can use cloud infrastructure services to scale as your company grows. In the past, before access to cheap cloud services, a person might have come up with a brilliant idea, but it might never have gotten off the ground because of the tremendous amounts of capital it would have required to turn it into a company.
Today, thanks to the magic mixture of cloud and mobile, all it really takes is a laptop and a credit card and you can start a company.
And Greek startups are no different from any throughout the world. Without access to these services, they can’t stay in business. They are in effect taken back to the early 2000s when they are cut off from these essential services.
Stepping Up To Help
Greek startups are fortunate though because a couple of guardian angels have stepped forward to help them ride out this crisis. As Tsotsis wrote in her article:
Imagine being a founder competing against other startups that can pay their bills? This is why the founders of BugSense, one of the handful of Greek startups to have seen a successful exit (to Splunk), have offered to act as a proxy for Greek startups that need to make payments.
All of this has shown just how valuable the cloud is to startups and how devastating it is for them when they can’t access these essential services. It’s hard enough to take a startup from idea to market and succeed, but without cloud services, many today would be lost.
If the Greek government wants to help find a way out of this, they need to realize that throwing a blanket over the folks who are potentially their economic future is not the right way to go about it.
As the old Joni Mitchell song goes, “you don’t know what you got til it’s gone.” For Greece that line applies on so many levels. For Greek entrepreneurs who might have taken the cloud for granted, they have gotten to see first-hand what it’s like when they can’t get access to these services.