An Entrepreneur’s Trip to a ‘Depressed’ Spain & France: KKK Light, Old Conflicts, Spicing up Tapas & Playing Gipsy Kings [Part 2]


This article is a part of a series – read part 1 here

In Israel, everyone we ran into, from family to former employees, were entrepreneurs who had gone public and had either sold their companies to IBM or were working on the next big healthcare product. If they had a job it was with an entrepreneurial company. Since we were visiting my daughter on her study abroad, this was hardly scientific but it is indicative.
trip1Yet, it would be hard to tell that either Paris or Spain was suffering economically. The social net is broad in Spain. In France, you only see it in the hardscrabble tenements on the outskirts of town and the satellite cities on the way to the airport. In Spain, the giveaway is the mass of real estate signage and in the Costa Del Sol, where its concrete apartment skeletons and blocks of empty mansions wait for new tax exiles and dubious business folk from northern Europe and Russia.

What you don’t see are the signs of new enterprise, innovation or hero entrepreneurs. Only Britain was able to boast that, with sale by Nick D’Aloisio, the teenaged founder of the AI-based news summary app Summ.ly to Yahoo for a reported $30 million. It was encouraging when, at the Beauvais airport about 2 hours from Paris, we saw a sign boasting of the citing of major food, bio and tech companies. But in Paris, I came close to rock bottom of the entrepreneurship ladder when a shabby-looking man in the Marais heard that I was from New York and asked how much it would cost to live there for months. He was a game designer looking to raise capital. Since there is no VC money in France he wanted to know what his prospects were in NY.

Israel, on the other hand, is full of angel money cascading down from the entrepreneurs who have made in big. Companies like Teva Chemicals have VC funds and they are very active in funding healthcare start-ups. In Spain, the government actually set aside a few hundred million to help failing businesses but – surprise, surprise – about half of the money disappeared into the hands of “agents” who were supposed to distribute it. Is it my imagination, or is it that socialism has a way of making bureaucrats act like “entrepreneurs” and the business class like serfs?


Zara’s Amancio Ortega

What makes Spain so interesting is that it is the home of the most successful artist ever and the world’s third richest man: Picasso and Zara’s Amancio Ortega. The world’s richest man, Carlos Slim, is from   Mexico. The 2nd and 4th richest are our own Bill Gates and Warren Buffet followed by Larry Ellison the Koch Brothers (oil and steel) and the French perfume and fashionistas with the L’Oreal and LMVH fortunes.

In other words, France, Spain, Mexico and the US comprise the 10 richest businesspeople in the world. But only the U.S. economy, while troubled, is growing and the others are in significant trouble. The difference is that most of the American players (Gates, Ellison and to some extent, the Koch brothers) are involved with innovation and that tends to throw off venture money. In Spain, money is in a clothing empire that is mostly vertically integrated and grew out of the same organizational principle that guides the Eater tronos. As Wikipedia put it: “Ortega produced clothing using thousands of local women organized into sewing cooperatives.”

In the former Spanish colony of Mexico, Carlos Slim, a successful stock trader, leveraged the Hispanic tradition of syndicates by buying them up when financially strapped, to monopolize the communications industry, and becoming the world’s richest man.

Spain’s Ortega also harnessed the creative element of Spanish culture – design – arguably putting him, at some level, in the same class as Picasso, the groundbreaking iconoclast, as well as the devoutly Catholic architect of Barcelona, Antoni Gaudi. It is a little more complicated than that: Zara is known as an expert copier of others’ ideas and has no famous in-house designer. There are no stars. Everyone carries the Zara trono. The fact that it originates from the same Galician region in the north as the former dictator, Francisco Franco, is not entirely lost on the media, either, and the empire is known for its secrecy and lack of advertising. Nor is the Picasso genius lacking insofar as his famous saying goes, “good artists borrow, great artists steal.” Finding Picasso’s “victims” is a beloved past time of art historians, as is the media finding Zara’s.

Part three of this series will be posted next week on Friday, June 14th.

About the author: Alan Brody

Alan Brody is the founder of the iBreakfast.com and SAVVE – Silicon Alley Vision Venture for Executives – brainstorming events. As executive program director of TECHmarketing, he has a long history of creating firsts in high technology media events which now includes eTV World the Digital TV/Internet Conference and Hollyweb, a major conference event at both the Consumer Electronics Show and the National Association of Broadcasters.

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