Investment opportunities for conventional capital in the world of technology
In Turkey, we have always discussed the technology within the scope of the digital transformation; however, we have missed the fact that being a technology developer is more important. We have always been proud of how well we used technological products produced in the world and how skillfully we integrated them. However, beyond being the users of technology, all organizations need to be in a position of technology developers creating added value by incorporating technology into their products and services.
In Turkey, many talented technology ventures emerge, particularly in certain areas. Some of them become successful in a short time, and they enter international markets.
Often I hear comments such as “People will continue to eat vegetables and fruits, so technology is not essential in all areas”. Of course, many traditional lines of business will continue as they have, but technology companies will take advantage of profit margins. Companies that do not use and develop technology properly will become production plants with a minimum profit margin for technology companies.
Traditional companies need to cooperate and establish partnerships with these technology companies in order to develop new technologies and to make a difference by including them in their products and services. It is not possible for these companies to fully understand the opportunities and to integrate their organizations into these processes without investment or partnership.
On the global scale, the most common strategy applied by organizations is to allocate funds for the technology world and to transfer some of this fund to venture capital investment funds. In this way, they can dominate the whole market without incurring any costs and have the opportunity to establish partnerships with technology companies at an early stage. When they combine their organizations with the strong flow created by these funds, they not only benefit from various opportunities and integrate their organizations with the technology world but also they can take advantage of direct investment opportunities in technology companies that are directly related to their core business.
The technology ecosystem in Turkey is very advanced, especially in certain fields. The game industry alone achieved an export figure of 1 billion USD in 2018, which was the IT export target of Turkey for 2023. Entrepreneurs from the banking sector, which is number 1 in Europe and the Middle East in terms of using technology, have been doing very successful Fintech businesses. We have outstanding Fintech ventures both in Turkish and international markets. In line with the developed retail and healthcare sectors, technology companies operating in these fields have been opening up to the world and receiving investments with a high valuation. We also need to mention the manufacturing industry. Turkey, as a very successful country in terms of manufacturing in areas including machinery, automotive, and white appliances, provides ideal conditions for technology ventures to emerge and grow, particularly for those operating in the field of Industry 4.0.
In summary, technology companies that were established in Turkey have become successful in international markets, and this success will grow exponentially. My advice to the organizations operating in traditional fields is that they should get the opportunity to become partners of these companies before it is too late…
Barış Özistek - Boğaziçi Ventures Board Member