Innovation is a key driver of progress, and companies need to stay ahead of the curve in the world of technology. One person who knows this better than most is Alexandros Eleftheriadis, a seasoned expert in the field of deep tech.

With over 150 patents to his name and a wealth of experience in video coding standardization, Alexandros has played a key role in shaping the industry. He was also the co-founder and Chief Scientist of Vidyo, known for introducing the architecture used by all video conferencing providers today. In November 2021, Enghouse Systems acquired Vidyo to expand the Enghouse Interactive product portfolio.

Today, we delve into Alexandros's insights on the importance of investing in innovation, his experience building a strong deep-tech network, and the lessons he has learned from his extensive career in the field.

The key takeaways from our discussion with Alexandros are:

• Build and use your professional networks to find the right companies to invest in. And don’t forget to team up with the diaspora, venture partners, and organizations supporting entrepreneurship communities.
• Deep tech hubs are strongly tied to the presence of academic institutions and research centers.
• Europe is building similar centers of innovation but has yet to reach the scale seen in the US due to differences in the educational system.
• The funding model for European research is misguided, and a single principal investigator model should be adopted instead.
• Educating students about the venture creation process is crucial in supporting innovative projects that could become companies.

Who is Alexandros & Big Pi Ventures

Alexandros Eleftheriadis is an active angel investor in Greece and the US and a partner at Big Pi Ventures, a deep-tech venture capital firm based in Greece.

Alexandros started his career as a professor of Electrical Engineering at Columbia University. He has extensive experience in video coding standardization and has held management roles in various forums such as the Alliance for Open Media, ISO MPEG, and ITU-T VCEG. In addition to his professional work, Alexandros is an avid musician who plays the Greek bouzouki and is an offshore sailor.

Big Pi Ventures is an early-stage venture capital firm that focuses on investing in deep-tech startups, particularly in Greece. The firm aims to identify and support ambitious founders who are working on disruptive technologies and have the potential to build globally competitive companies. The firm provides funding, strategic guidance, mentorship, and access to its extensive network of industry experts and investors.

With a strong focus on deep tech, Big Pi Ventures is committed to helping startups in Greece and Southeast Europe realize their full potential and become leaders in their respective fields.

How to Find The Best Deep Tech Companies For Our Investment Portfolio

The importance of a professional network.

“One of the most important things we do as investors is to identify target companies. We do that through several mechanisms.

Firstly, we have our immediate professional network. I have been involved in engineering research and development in the US for over 25 years. So, I have an extensive network of professionals who work for tech and startup companies.

There is also a strong connection from my side with fellow diaspora Greeks.

This is very important because it’s part of our mission at Big Pi Ventures. We want to invest in companies that have or will build development teams in Greece. All our partners have connections abroad, particularly in London and Boston.

We also have venture partners that work with us and help us identify good candidate companies in New York, Boston, and San Francisco.”

Academic partnerships & their role in startup investments.

“Another way we get investment prospects is through organizations such as Endeavor or accelerators such as EGG. They do a great job identifying mature opportunities and helping them develop to a point where we can get engaged with the project.

As a fund focusing on deep tech, we also have strong ties with universities and research centers in Greece and abroad. We have funded companies commercializing technology from the University of Crete in Greece, Oxford University, and Tufts in Boston.

I often give talks in academic audiences explaining the role and function of venture capital - I think it’s extremely important for young professionals to be aware of this exciting opportunity for professional development early in their careers.”

Funding Models in Research - Europe vs. US

Strong academic institutions and research centers are important in creating deep tech hubs.

Deep tech hubs are located in places with strong research output.

Looking at the major international centers, you will see strong academic institutions and research centers behind venture excellence.

• Silicon Valley has Stanford and UC Berkeley.
• Boston has MIT.
• New York has Columbia.

Previously, in the New York area, there were also AT&T Bell Labs, Philips Research, IBM T. J. Watson, and Sarnoff, among others. This was key for creating a steady pipeline of innovations incorporated into commercial products.

Shares Alexandros Eleftheriadis with us.

How can Europe Support Further Innovation in Deep Tech?

European Education is blocking Europe from building a deep tech ecosystem.

“Europe is building similar centers in London, Cambridge, Oxford, and to some extent, Stockholm, Lausanne, and Zurich.

However, it has yet to reach the scale we’ve seen in the US.”

The problem lies within how education is structured in our universities compared to other strong hubs, such as the US. Alexandros explains why:

“In many countries, universities are exclusively public. This means that oftentimes are slow to adapt and adjust.

For example, pursuing patent protection for inventions in academic environments and research centers is expensive and cannot be borne solely from research grants. A patent’s annuity payments will surely exceed the duration of a research grant, and the university has to create a budget to finance it.

Creating startups means the university must be prepared to sign an agreement to license intellectual property. For many universities, this is an unknown process, and many slow down the commercialization process to the point of killing it.

Universities in the US now employ template models for licensing to avoid having to perform valuations for individual patents. This way, they can launch an order of magnitude more projects yearly.”.

What does the European funding model for research look like?

“Our funding model or research is misguided.

The dominant model has been one of the collaborative projects. One or more university teams join forces with companies in a joint proposal.”

Additionally, Alexandros tells us how much time is spent on unnecessary items that are not researched, and the focus should be elsewhere.

• picking the right acronym.
• building a list of milestones and deliverables.
• Counting man-months.
• Populating Excel sheets with complex Gantt Charts.
• .... and many others.

Research - by its nature, is unpredictable.

“You cannot guarantee what will happen in the upcoming 12 months of research and guarantee that you have found the right solution to a particular problem.

In Europe, many of these projects are often just software development exercises with very poor quality actual research results. Or even worse, you get a Ph.D. working on one of these projects, creating a culture that considers this type of work enough to earn a Ph.D.”

The European funding model vs. the US-based funding model.

“In the US, you have a single principal investigator.

A professor or researcher proposes a particular problem and receives funding for three years.

This way, they can support the salary for one or more Ph.D. students and himself/herself (part of a professor’s salary in the US can be covered by research grants).

The researcher can decide to change the research subject if it appears that he/she cannot progress with it or if he/she finds a promising alternative direction. The granting institution is happy if the team publishes suitable journal or conference papers. There are no Gannt charts, man-month accounting, etc."

Why does the US have a better funding model, and what can we learn?

“We can see how effective each model is If we look at the quality of the research output and the quality of the researchers trained with each model.

It is not an accident that the EU introduced the concept of ERC grants (single investigator grants).”

Trends in The Deep-Tech Ecosystem. What’s next?

Everything will change in five years. - Says Alexandros.

AI is maturing. ChaGPT is changing the dynamics.

“We already see the transformative power of AI innovation. Microsoft & ChatGPT demonstrates a masterful execution for a company of its size. Google is following the trend with Bard, concerned that it may be left out.

Reportedly, a misstep in the rollout cost Google a $100B reduction in its market cap.”

“Several strands of technological evolution converge and reach new levels of maturity and sophistication that solve real problems.

The acceleration becomes explosive."

This is the beauty of deep tech.

"ChatGPT reached 1M users in five days. Spotify took five months. Facebook took ten months.

Our role in venture capital is to be part of that journey. As the saying goes, the best way to predict the future is to invent it. I would paraphrase: ****”

“The most important task is to educate students about how to create new ventures.

They need to hear how small teams can start building interesting projects and how they can obtain funding through VCs and other ways that allow them to grow.”

Young entrepreneurs are those who will create the next generation of useful tools for our lives.

“They must understand the financial mechanics of the process as well as the human aspects of building and leading teams.

A couple of courses or seminars should be sufficient, as well as presentations from people who have followed this path.”

Today’s opportunities need to be integrated into the educational curriculum.

“It would have been eye-opening if I could have the information available today when I was a Ph.D. student. I graduated in 1995.

I think it would be best to be integrated with the curriculum, especially in disciplines where new venture creation is strong: electrical engineering, computer science, biology, medicine, etc.”

Resources mentioned in the discussion:

Connect with Alexandros:

• Alexandros’ Linkedin
• Alexandros’ Twitter
• Big Pi Ventures
• Big Pi Ventures Linkedin

Others:

• Vidyo
• Endeavor Greece
• EGG — Enter Grow Go
• The best way to invent the future is to predict it