Advice to young Entrepreneurs from Professor Costas Markides

A while back I had the pleasure to meet, and fire some questions at, Professor Costas Markides.

He is London’s Cypriot born strategic marketing guru, who advises and consults for some of the world’s biggest corporations and has been quoted as one of the world’s top 3 gurus for his genre.

Being of Cypriot origin I caught up to him and asked him questions about himself, how he got to where he is, and some advice for all young business minded people. I know its a bit long, but his advice is worth it. Here is what he had to say:

OTI: Tell us a little bit about yourself, where you’re from and what are you doing?


Professor  Costas Markides :

Originally I was born in a small village near Morphou. I went to the English High School here (in Cyprus), served in the army and then in 1981… I then went to Boston and did my undergraduate there. Then I went to Harvard and did my Masters in Business and my PHD and finished in 1990.

I got a job at London Business School  first as an assistant Professor then I got promoted to associate professor and now I am a full professor at the London Business School. I teach Business Strategy and Innovation. My job is basically to do research publish my work, publish books and teach students and also consult companies. I work with companies on their strategies and innovation process and things like that.

OTI: You said you studied in the USA. Do you think there is a specific reason why many people go and study in the States?

Professor  Costas Markides :
That is very interesting because I graduated and did my O/A levels from the English school here in Nicosia in 1979. In those days there was a perception among the youth in Cyprus was that the good students go and study in England. Those who did not have A levels used to go America. Why in America? There are so many Universities in America, even if you don’t pass your exams you can still find a place to go to.

I still remember because I was tempted to go study in England. I was actually planning to go and study medicine in England, and then Margaret Thatcher came to power in around 1979, and she increased the fees for foreign students. And then my parents said to me “why don’t you go study in America to study and so on”? And even in those days I said “No way I’m going to America” because if I had told my teachers at the English School I was thinking of going to study there, they would’ve thought that I didn’t pass my A levels!

Anyways, one thing led to another and I got a Fubright Scholarship and I ended up in America. In those days there were very few people who did so, now apparently its very  very popular. I think the original people who went came back and said it was so nice and so wonderful and I think that this may have added to the attraction of studying in America.

I think there is another benefit to the American Educational system having seen it and so on. When I went there I ended up studying Economics. They told me that in order to get a degree in economics you have to do 32 courses in 4 years, but of these courses half of them are Economics and the other half are courses could be anything you want, for example literature and sciences. But when you go to England to study economics, its only economics.

So in my opinion there are pluses and minuses for this. The American educational system expands you in a very broad way , whereas in the English system it tends to be more specialised. Some students prefer the American way of education. But I think the big attraction of America is not the educational system but the country itself! People want to go to see Boston, New York, go to Washington, those kind of places, not forgetting Los Angeles! I think that’s the attraction!

OTI: Can you figure out any reason why there are so many aggressive entrepreneurs coming out of America these days?

Professor  Costas Markides :
Oh yeah! Think about it. You start something here in Cyprus and you talking about ‘if I get 3,000 or 4,000 users’ whereas if you start something in America, then without even being successful you talk about getting a few million users! Thats one thing.

The other is the culture. In America the culture lets you try something and if it doesn’t work, you just try something else. Whereas in Europe if you try something and you fail, its considered a big shame. In America it’s like a badge of honour that they put it on their CVs, they say “I’ve tried 6 companies and they have all failed”. In England or in Europe they hide these failures away. So the culture is there. I think that the fact they had quite few examples of people who started small and made it big and became millionaires and so on gave people incentive to try it out.

So it is a variety of factors that leads to this entrepreneurial mindset. The inflow of all these immigrants into America too you know. If you think about it, Americans are very proud of what they have achieved up to the second World War. Most of the people that have achieved that are immigrants. So the new blood comes in, they all start from below the poverty line, they all have the desire to achieve something, so they get creative. Whereas in Europe its all “Money, you are born rich, who cares, I’ll use my fathers money” and so on and so on. There is a variety of factors I think that drive that.

OTI: What do you think about the trend in Cyprus to expand into or from Greek companies. Why do you think that, except for the language similarities, Greece is the main market to expand into or from?

Professor  Costas Markides :
Well first of all Cyprus IS a small market so naturally when people thinking of expanding abroad they think of all the different countries ‘where could I go?’ There are various similarities I suppose that one or two look at. Language similarities and cultural similarities and so on. Naturally they gravitate towards Greece because they think we are Greek and we have the same culture and so on.

Personally I dont think that is particularly true to be honest. I think that we are closer to lets say Lebanon and Middle East than the Greeks. You know we have all this cultural ties with Greece. Greek Cypriot people, every other weekend they go to their families for the weekend. They know people, they think they understand the system there and so on and they expand to Greece. Whether that is the best strategy in my opinion its another story.

But you see the logic of it.

OTI: Yea I do. What would your advise be to young Cypriot business men, wanting to start new companies?

Professor  Costas Markides :
I think first of all, if I reflect on my own career, the biggest benefit that I received was go outside the island. You know you have to go outside the island. You have to experience other cultures and mentalities and other people. Because its a very small island and have a very set way of thinking if you live your whole life here. When I say “go out” I dont mean go on holiday for 2 weeks. Thats what we do, we go for 2 weeks on holiday to Amsterdam and we think we know the Dutch, we go for 2 weeks to England and we think we know the British! Young people should get out of this system and live in another country. I say that but I see a lot of young people come to live and study in London and all they do is go to the Greek cafe and socialise with their Greek friends, they never get to learn the foreign mentality.

OTI: Yeah we’ve seen that in Manchester too.

Professor  Costas Markides :
The first thing they should do is get out and live a different way of life and see how other people think. The second thing is we dont read here! Its amazing we dont read here. You go to the beach for example and you see all the foreigners lying around with a novel reading and they Cypriots what do they do? The swim, they may read a newspaper and talk about Apoel. There is a culture here that you go to your University to study and once your finished you dont open another book! Its amazing to me.

If you go around Cyprus now and start talking to them about Blackberry or about Facebook or Twitter I don’t think most people dont even know what they are! I’ve spoken to some of them in London and I say would you like to go to the Apple store and they will tell me ‘why’? Have you ever been to the Apple store? And they say ‘No’. Well you know the Apple store is not just a store, its a concept thats revolutionised the industry. You may just want to go and expose yourself to it. There like ‘No, I’ll go to the Marks & Spencer store or Selfridges’. So I think the second thing people need to do is not only go and live abroad but to educate yourselves with what you see here. You have to read you have to keep yourselves up to date with all the technological and social developments abroad and so on.

I don’t think Cypriots are not entrepreneurs. On the contrary, this country, this island has a lot of entrepreneurs. If you think about it 30 years ago we had 25% unemployment rate after the Turkish invasion and we were a very poor country. But look at us now, one of the wealthiest countries in Europe and so on. Why? Its due to the entrepreneurial spirit of the people here! So I dont think there is anything they should be doing business wise other than exposing themselves a little bit more to the outside world.

OTI: About those students who have just finished their studies and leaving University life and entering a hostile job market. Would you advise them to try start new companies of their own and create new jobs or to go back and study till the crisis is over?

Professor  Costas Markides :
(laughs) Well I know what my students are doing at London Business School. We have a record number of applications this year because maybe many people have lost their jobs so they are applying to the business school or they think this is the right time to leave their job and study for a couple of years. At the end of the day I think if you are an entrepreneur, it is in your blood in my opinion. Either you want to have your own company and live the life of the entrepreneur or you’re the secure kind of guy who says “I want to work for the government or I’m going to go for a big company and settle there”.

Last week I had a friend of mine from Poland visit me. He is 46 and he started talking to me about maybe starting his own company. So I asked him when did you start working? He said when he was 22. What companies did you work for? 2 companies. What does that tell you? I said you spent the last 24 years of your life working for 2 big organisations. Maybe the lifestyles of these two organisations is what attracts you. The fact that they give you a company car, the fact that they rent your house everywhere you go out of the country and the fact they give you share options.

You ask me now that should new students graduating start their own company or go back to school? If you have the entrepreneurial bug in you I think you should just go out and just do it even if it is not the best time to. In the process you may discover that there are certain business skills or knowledge that you lack because the world has changed. The entrepreneur who made it in the 1950-1960s will not make it now.

I mean there are much more educated people around today who know how to strategically construct their companies or how to innovate and so on. Maybe the process you’ve discovered that you lack some business skills, then you go back to school and get up to date.  If people don’t think they have the entrepreneurial bug they should go out and try get a job. My advice is you have been a student  since you have been 6. Its comfortable, you go to university, you do your bachelors you do a master. Get out of that comfort zone. Get out of school, spend 1 year, 2 years, 3 years doing something else. And then if you feel the need or urge to go back to school- go back to school! You still have 50 years of your life ahead of you!

If on the other hand you are enjoying what you are doing, forget the school. Maybe you don’t need to go back to school. I don’t think there is a standard answer I would give to young people. Go out and see what you can do and then decide for yourself if you need or want to pursue further education. Its a difficult environment I have to say but there are jobs out there! I see from my students this year who have started the recruitment process. Some were complaining in January ‘its a tough economic climate’ and so on, but now if you see them, most of them have got jobs proving to their employees that they can make money for them.

OTI: Being a young entrepreneur myself, (its something that bothers me too) how should youngsters go about getting either an investment or grant now that we are in the EU, (except for using daddys money!)

Professor  Costas Markides :
I take it that there is no venture capital in Cyprus….

OTI: … not too much. There is a few ‘spenders’, but we are talking about people who are mostly interested in real estate.

Professor  Costas Markides :
And I take it that the Cyprus development bank is not into development anymore?

OTI: Not really…

Professor  Costas Markides :
…(laughs) because I would have thought that this would be prime example of a venture that the Cyprus development bank would make. I mean the traditional bank, maybe they wouldn’t fund a venture like this but why not the development bank?  Because that is what it is, a development.

Its difficult, if there is no hand in finance within Cyprus, then you have to go outside. You can seek finance in the European Union level. But even at the European union level they tend to finance primarily country-wise initiatives and so on. You have to find venture capital in Europe, for example you have to come to London to get it. You have to prove the viability of your concept  beyond Cyprus, in my opinion, to get the venture capital, say in London, interested. You have to network.

In my school for example we have close association with Angel investors. So if any of our students are interested, we network them. My school offers facilities where they can start a base you know..

OTI: I believe Manchester University does that but I expect them to take a big equity stake especially in the Computer Science Department.

Professor  Costas Markides :
I understand what your saying, but its difficult. Either you have to prove the viability of your  concept or you put your own money in too and after a certain stage, when it shows that its going to work out, then you get other people coming in.

I think you did it very well in the sense that you started on a part time basis. You did not give up your studies or give up your job and say ‘I’m gonna do this’ and then 3 years later you realise ‘oh shit its not working’! You started small you built it up and now you have reached a stage where you are going to graduate from uni and you say “it’s a viable concept and I can spend the next 2-3 years of my life on a full time basis to make it work”. And then after 3 years you either build up or you say “OK if it is not working I’ll move on to something else”.

Do you find that the young Cypriots to be more willing to take the experiment with you with things like this?

OTI: The younger market, ie the people who are in university now, yes. because they are always exposed to it there. However with bigger companies and organisations here at home its very difficult to get them on board. Until perhaps when the younger generation gets back from their studies and get jobs at these companies and have their own say within them.

Professor  Costas Markides :
Good luck with that and keep doing what you are doing. It seems to be working!

OTI: Thanks very much for your time.

Professor  Costas Markides :
Thanks for having me.

I would once again like to thank Costas for his time and wise words.

I hope this interview helped many of you with your future decisions or at least introduced Professor Costas Markides to you as an example of what hard work and persistence can do for yet another very successful Cypriot.