Grant Van Cleve is a Global Entrepreneur, Angel Investor, leader, and statesman for the prestigious Tech Coast Angels. He is currently invested in 90 startups mainly in California but has been engaged in the Ecosystem of Albania and its development for about 30 years.
In this interview with AlbaniaTech's Platform Leader, Gerti Boshnjaku, he shares with us his broad overview of the Ecosystem of Entrepreneurship and Startups, the problems that exist currently, and valuable paths to the solutions in his opinion.
Gerti Boshnjaku: Hello and welcome Mr. Grant, thank you for visiting our offices. I am really glad to conduct this interview with you!
Grant Van Cleve: It’s good to be here!
Gerti Boshnjaku: We have been introduced to each other lately but you told me that you have been in Albania for quite some time now, so we may start this conversation with you by telling us a little bit more about your background and what brought you to Albania?
Grant Van Cleve: Good question! I came to Albania at the end of June 1991. At first, I came with the wave who was part of reintroducing the protestant faith to Albania. I’m not a theologian, in fact I come from a strong business background. But the world was changing in the early 90s; so it was the opportunity to come and make a difference in one of the post-communist countries. To help it re-build some foundations.
Accidentally I got selected to come to Albania. I came for 6 weeks, which became 6 months, which became 6 years. That is the ‘fault’ of the Albanians… for being so hospitable, warm and friendly. Plus it was truly a place that was changing dramatically. For 19 years we didn't want to be anywhere else! From 1991 until 2010, we were mostly in Albania. Spent some time in Greece, Turkey, and Sweden. My wife is actually from Sweden but she was a co-worker in Albania.
We moved from the non-profit world to the traditional business world over time. I sort of went from helping plant churches, to consulting with the government and these organizations on how to be more effective. When I finally realized Albania was headed in a good direction, I thought I would go home and continue business. Instead, I found that the business climate was changing the economy was starting to grow. There were new foundations, so I switched and started to get involved in business here. I had a construction business and I had an informal incubator to help a number of Albanians start their businesses.
Gerti Boshnjaku: Given the fact that you have been here for 30 years, I understand that you have witnessed the changes during these years. You got to know Albania from many perspectives. There have been a lot of changes since 1991. And from 2010 when you left up until now. How do you see the business climate changing? How has it evolved? What opportunities do you see in these changes?
Grant Van Cleve: There were obviously dramatic changes in our society, the infrastructure, our method of governance, our seriousness about governance. It’s been great to follow all those changes and to participate in some way. I’m just going to talk about a construction project that I did, I am not sure if everything was done correctly, but we were innovators in that space. It was a chance to do something different that had not been done. In fact, it was Albanian business persons that said “We know how to build up buildings or large villas, for ourselves… but we don’t know how to build a community.” So the project we did was innovative, we were able to help masterplan, together with the government, an entire zone that now has a whole new life. It was a very exciting time to be part of that!
I think business is most exciting when you create something from nothing. It can be a neighborhood on a hill, or it can be a business solution for something that needs to get digitalized, new software to solve something for people. When you’re really creating something new. So, I got to experience that during Albania and now that there is a better foundation and a lot of those initial areas for business are filled up.
I was thinking of the American Enterprise Fund. They made a lot of money because they were the first decent bank, the first decent insurance company, but now that there is a lot of them is not quite as easy to just create something totally new. But there is still a lot of opportunities to create change. Albania is developing a different reputation internationally. It is not the place that is exporting criminals or trafficking drugs. It is actually a very vibrant place. With good weather, good food, good people, and good lifestyle - work and play balance. The world is starting to notice it. People want to come here! Now we have opportunities to create things that don’t just solve problems for Albania, but create solutions for the region, or maybe the world.
Gerti Boshnjaku: I hear this quite often, all the foreigners that come here really appreciate this type of lifestyle. They like that Albania has the food, the weather, the relationships, the hospitality but it seems that we as Albanians do not count too much on that. Many youngsters want to leave and explore abroad. Is it a general thing with youngsters in all the countries or is it a phenomenon happening mostly in Albania and what do you think might be the reason?
Grant Van Cleve: That’s a very good question. And I am trying to understand the answer to that myself. Even though I have been involved for the last 30 years, the last 10 years I was significantly less involved. I have been very focused on California. Startup technology companies there, which has been very fruitful. It has been nice to make some money and have a good reputation in my own home country with a new career. But I have always been longing to come back here. Now that I am back I see that Albania has changed, even more. The governance is receptive to technology and innovation. There are very good people doing innovative things here and feels very exciting to be back.
I think if I was in Albania 10 years ago and I could look forward to what’s happened now I would be excited and amazed. I would be looking forward to being here. But something has happened in between. We feel we haven’t grown fast enough. Or people are disappointed in some other areas such as education and health.
Also it is not easier elsewhere. If you get a job in Stuttgart you may take a train for 90 minutes to your work, and you sit in a cubicle like a sardine, and you go back home in your small studio and you sit by yourself and you have a WhatsApp call with your mother. It’s not that great! Meanwhile, your friends are back home in a great cafe, and the weather is good. That’s in some ways where I think the secret lies. We can create digital jobs to work with foreign companies from here. Get exposure to the world. Get salaries that are closer to the West and at the same time start to bring foreigners here to join teams of Albanians that are skilled. Then I think we have created something that there is no reason to leave from.
We have to create it, and then believe that it can produce that fruit. But it’s not easy!
Gerti Boshnjaku: I see another perspective from what you are telling me because now we, as local companies, are a little affected by these digital jobs. Many of the youngsters that might be a very good workforce here are applying to go to other companies. But as you said this is a process. And you might also attract a foreign workforce. And not just the low-level jobs. This is a good perspective, and we have to work together for it as a community.
Grant Van Cleve: I think we had a boost during Covid here because we were more open. I know we had times where it was more restrictive, but in general Albania was a place where you could still come. And many people landed here by accident. Some people – Egyptians, Indians, etc - had to stay here to do quarantine before they went back to England or the like . Or some people just came to get away from wherever they were. They were ‘stir crazy.’
I have been doing informal market studies during my visits the last six months and I met a lot of foreigners who came here by accident for 1 month or 2 weeks and then they asked their boss if they could work remotely from another country. They wanted to return. We had a visit from the Factory Berlin, when they got here they were surprised about the ecosystem but also that it’s a very livable place. And that was November: not our best month. A little cold. Imagine if the delegation came in May or June and saw the rocking streets filled with people. Saw activities in the center. Especially in 2022, when Tirana is going to be the Youth capital of Europe. We have a lot of life here!
Gerti Boshnjaku: I was listening to you and I was thinking the same thing, that Tirana will be European Youth Capital for 2022. There will be a lot of initiatives that will be happening in the city during the whole year. It’s not just like one conference or one event. It will be several. The Municipality is doing a lot of planning and preparation and is getting prepared to do a lot of promotion for Tirana as a country to live, to bring Digital Nomads, to enjoy and see how it feels to properly live in the city. Not just come here by accident. But you came to my question, I have seen you engaged lately in the Global Entrepreneurship Week and other activities since September. What is your relationship with the startups? What is your opinion about the Startup Ecosystem in Albania?
Grant Van Cleve: To give a background in general, I am an angel investor and I am involved in 90 different companies around the world. Most of those in California. It’s a large number, and some of them have been rather successful. Not the ones you read in the newspaper necessarily, buy they are noteworthy anyway. Most of ‘my’ companies have been within California, which is the center for startups in the world.
My ultimate goal is to do startups in Albania But my way to get over here recently wasn’t for that though. It was for Holberton School (www.Holberton.al). So that we can provide software engineers to work at foreign companies wanting to do ‘nearshore’ work with Albanians. I have a couple of German business partners who know that there are thousands of jobs they can bring here. But we said if it is going to work we have to have more software programmers to employ here. So, then, we decided to be part of training more so we have a bigger ‘supply’ of people to meet the ‘demand’ for those jobs. We studied the market and started the Holberton School which will help. In a relatively short time, with a very strong quality program, it can create a fully prepared programmer in a year.
We want to bring the jobs, the jobs require technologists. And as we create technologists that will bring the startup side. When you have five times as many programmers - and they are doing great, high-quality projects with international companies – they are going to get skills and get exposed to ideas that will lead to great startups. The easy part in Albania is to be entrepreneurial I think (even though some people get their diploma and go straight for a secure state job). In general, ‘we’ Albanians are people who will dare to go abroad, dare to do something different. We have grit, that determination to solve things. But we are a little too independent, we don’t work that well together in things we are daring to do.
I remember in 1991 I lived with an Albanian family and if the bicycle broke, they didn’t have tools or replacement parts to fix it. But there was always a solution to fix it. That ingenuity is in the Albanian people. They have been through a lot of hardships. So I think that is the problem. You can train people great in Germany, you can get a perfect education, but they have no entrepreneurial passion or courage. So Albanians have that but we need to infuse it with a little more skill, a little more numbers of people, and a little better ability to work together.
Gerti Boshnjaku: So, to structure it takes a bit more. We take initiative, we try to find a solution for the problems because we are used to having a lot of problems. But we lack structure. We don’t have the proper way of doing things, it might be an instinct but we do not think largely. I have seen in many startup activities that at first you start to learn how to think creatively, how to be a problem solver but that is the easiest part. The hard part is how to turn this into a business and create a lot of value worldwide not just for yourself.
Grant Van Cleve: We have 70 jobs coming here which are going to be largely in Artificial Intelligence and Machine Learning. And at least one of the software companies of Albania had enough of those people to qualify for the tender. And then the teammates are going to get exposed to the best of a giant corporation like Siemens. The most advanced smart-building technologies. The most advanced coding methods. And the are going to be paid well and stay here, and they are going to be exposed to ideas. That growth, combined with that independence and creativity of Albanians will probably lead to doing some great things.
Same thing if the Factory Berlin comes and we partner with some German Startups. Then you have a team of Albanians and Germans working together, someone brings the structure, someone brings the creativity, the product does better, and then it gives birth to new ‘children’ -which would be new startups. So long-run I am very optimistic. If we do the steps we’re thinking, I believe Albania will be a significant Startup Center.
Gerti Boshnjaku: What is your opinion about the current situation?
Grant Van Cleve: Somewhere in between. If you look at direct results it’s not great. We have some really good companies. We have a few medium companies. And then we have a lot who are trying but it’s not going somewhere. Still, the fact that we have some infrastructure, some incubation, some trainers, some funding, and some people participating in it - that is all promising. At the Global Entrepreneurship Week, there were a lot of people at those events because there was building momentum. And when the Factory Berlin visited they thought it would be nothing, but actually they found enough signs of momentum to want to get involved.
So I would put it somewhere in the middle: Quality people. Good efforts. Pretty good community partnership (maybe needs some more). So what is missing is a little bit of experience, a little bit of time, and then what I think is sort of missing is active angel investment into those companies.
Gerti Boshnjaku: We say that we do not have enough investors. And investors say that we don’t have a lot of startups. Is it a question of not being in the right moment, or do we need more investment as a scene in order to grow more startups? Or maybe it is the opposite, we need more startups to attract the attention of the investors? For you as an investor, what are you looking for?
Grant Van Cleve: I don’t think is ‘either or.’ I think it is both. Sure, some people that might be good investors might look at it and think there is not enough ‘product’ to invest in. We do not have a problem with capital here. We have at least enough people with extra cash that they could invest. With the money needed construct another apartment building, they could do 100 startups. So I think we can train angels. And we can create a structure that helps them understand how a startup is different than other businesses they have started. I think there could be a way we can prepare them more so that when something pretty good comes along, they would dare to bet on it. The startup might fail – as many do - but if the angels are prepared for that… You need those failures to later create the successes.
Gerti Boshnjaku: Would an angel fund be a solution or a foundation that would be managed by someone well-experienced? How do we do this type of fitting, engage angels, provide this type of knowledge and manage this type of relationship? Maybe they need some insurance that it has happened in another country? That there are good results and there are good profits in the end. Would that be a solution or a link that is missing in the ecosystem?
Grant Van Cleve: I like the way you are thinking there. I think it could be a solution. If I think of it in the American context - which is the center of venture investing - typically the early investors, like angels, because of taking so much risk they want to trust their own intuition. Their own ability to analyze a deal’s potential. They don’t really like to invest via funds. They might like to be in a group who looks at the deal together but they don’t want to depend on other people to make the investment choice.
Later, when you get to the next stage, venture capital (‘VC’), the companies are further along, with lower risk. Then the investors think on how to be more effective. Which could be through a fund.
As such, my first answer is that a fund wouldn’t be great, at the angel level. But, hmm, you could be right that in Albania the early stage investors are just unsure. I think there could be business people who would like to be a part of early stage investing maybe as a social benefit. Just to help society.
So maybe there is a chance to build such a group fund. Some may be happy to be a part of it. I would be ready to be a part of it or help with that. Or if it turns out they would rather be independent investors, I would be happy to contribute to helping evaluate deals.
Gerti Boshnjaku: In terms of the legislation, do you see something missing that could promote or induce more attention from investors in the country? Is it something that the state might do or from other actors that can say you have this facility to invest in Albania, or if you do invest in startups, is there something that might be used in order to trigger more interest from the investor's side?
Grant Van Cleve: Well, we have been very active with the government - the national government and the municipality - in talking about this. They are open to input. I think they are using good wisdom to come up with good solutions. So I feel comfortable that we are headed in a good direction. There are concrete things, not just ideas. They are talking about ‘technopark’ kind of free zones where technology is centered that have especially strong benefits. But they are also looking at decreased taxes and decreased bureaucracy for startups in general.
There have been different startup laws that have been talked about, and we’ve been a part of thinking through that. I think the newest version of the startup law they have been working on could be very good. It’s more open and could even stimulate outside startups to come and be housed in Albania. To center their companies here which would really help put us on the map. If good startups are birthing here, and Albanians have worked on those international teams, then Albanians can later prepare for their own.
There are some good legislative initiatives on Digital Nomads, which would allow them to easily get visas to live here. So some lower taxes, some easier legislation, some easier ability to live here… I think all are important steps. Other countries are doing that too, so it’s a little bit of a competition. Albania can’t go all the way to the bottom, but I think they intend to make Albania have a chance to be like in Estonia.
Gerti Boshnjaku: That’s a nice way to see it, Estonia is a good comparison.
Grant Van Cleve: Small country, big results!
Gerti Boshnjaku: What should a startup do to attract more attention to investors like you? Is there a specific industry that you are interested in more or a specific sector? If I were a startup what should I do to make myself visible to you as an investor?
Grant Van Cleve: I wish I had a clear answer for that. On one level I think the problem is that we need a little more market orientation on our business market. Sometimes our market is getting our university professors or embassy staff to think that our business plan is the best or to get a grant. We absolutely need all these parts of the infrastructure to prepare people and to give that initial money when the Angels aren’t ready. But we need to make that transition towards the affirmation from actual money from the market. In the meantime, until we can really fix that, to get market money ready, I am very grateful for these other parts, I think they are playing a very important role so I don’t want to offend them. I am grateful that certain embassies instead of doing water wells are doing startups. I am grateful that the government is even talking about putting funds to sponsor startups. They’re intermediate tools that help. My guess is that next year there will be more of these tools and then will give us a little bit of time to prepare the investor base.
Gerti Boshnjaku: Regarding the specific industry, let’s say ICT, B2B Software products or mobile applications or agriculture, tourism. Are you more interested in one of them or as an investor you put your attention to something else?
Grant Van Cleve: Personally as an investor I am industry-agnostic, and from the investor's perspective having a diversity of fields is better. There is a myth that says “find something that you are good at and just invest in that.” The reality is many times these wining investments come from areas you didn’t expect. Diversification is a good investment strategy; and is also good for startups. Practically speaking it is not a bad thing to find out what we are good at. For example construction technology, gastronomy, tourism-oriented things. I mentioned earlier the size of the Albanian market, but we really need to be thinking that the ones that will break through will provide regional solutions, or broader international things, or will provide something which they can merge with a similar tool in another place.
Gerti Boshnjaku: It’s good to understand the way investors think because we are not used to interviewing many investors. So we want to thank you for sharing with us in this type of conversation your perspective and your ideas. AlbaniaTech is preparing to launch the first Startup Database of Albania, in cooperation with DealRoom, which is a huge platform that has more than 1 million startups in their database. We are completing the platform currently. We think that this will bring a lot more visibility to the Albanian environment in terms of Tech Startups but at the same time, we will attract more investors. How do you see it, is it a good step or is it enough for you to just go through a database?
Grant Van Cleve: If I would use experience from America, the best databases like that come along with a partner from the investor community who is recommending the particular deal that is on the platform. They are sort of stimulating the process, “Here is what I liked, and here is why you should join me.” Or sometimes they even set up a deal structure in there. If it’s really just you going on and looking for matching deals then it usually isn’t enough to get a serious Angle to invest. Angel investment is cash coming out of your pocket that you already have. It’s money you paid taxes on. It’s money that you have cleared through the system. You may want to invest it, but you also have options like real estate deals. Or maybe you have to diversify in order to have a tax benefit. There are reasons that you make investments. Or maybe you have social obligations to invest in a relatives deal. But if you have a stranger on the platform that has an idea and you are asked give him cash. And you don’t have any collateral on it. That is a high-risk thing. It is not easy to do.
So an Angel deal requires a whole process of convincing. Part of that process is information that can be spread through a good matchmaking platform. That is a chance to go on and read about a bunch of deals.
But a better step is when you can see those deal live. Hear them present, talk to the team afterward. Being in a room like that would be a good step for the ecosystem. But you have to evolve it, to include some connection to the existing investors.
Gerti Boshnjaku: What would be the profile of a startup that you would invest immediately in? What should that startup have? What are you looking for, for your portfolio, that you do not have?
Grant Van Cleve: All of my investments are about hearing a deal and seeing if it has potential. So I am not really ‘searching’ for deals. Maybe because I am lucky. I am in California which is the center of all these great companies. So we see a lot of good deals. For me most of my deals are one of two sides. It is either “I see something that it has a good market size and I really like the people who are doing it” or “I think they have the potential to fill this gap in the market.” If it has both I get excited about it and I say “Can I please be a part of helping you get there?” Or it may be something with fewer features, but it has a giant opportunity, and somebody who is just crazy enough to get there. It might not have just the right ingredients, but they are just a visionary entrepreneur and they help me understand that the company has a long way to go but when we get there the result will be exciting. Founds like that might say they can’t find people who believe in them, so it’s a chance for me to say “I want to be that crazy investor who gives you a chance.”
I have been teasing a couple of strong well-known local startups recently saying that I had been here a couple of years ago I would have wanted to be a co-founder investor in their deals. But now it’s too late they’ve gotten expensive (i.e. high valuation). Now I can just applaud them. So it’s the companies that are up and running with great potential, or the crazies.