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January 14, 2013
SKYPE News - Skype Co-Founder Browsing the Globe for the Next Hot Tech -Earner
By Shankar Pandiath, TMCnet Contributor
Skype and Kazaa founder Niklas Zennstrom, now chief executive officer of venture-capital firm Atomico (News - Alert), is browsing the world for the next hot tech start-up. He believes that the next hot tech business can spring either from a place like Istanbul, Sao Paolo, or any of the coolest districts of London.
Zennstrom is also prepared to fly around the world to find it. He is looking for start-ups that might interest him, so that he can help them shift their gears into the new market with his experience gained from growing Skype (News - Alert) as an Internet phone service.
"Talent can pop up anywhere in the world, it's not just one city block," said the Swedish entrepreneur and venture capitalist.
Zennstrom, 46, started his venture-capital firm Atomico in 2006 and now travels the world searching for young companies that tap into the rising popularity of smartphones and Internet shopping. He focuses on profit potential, after experiencing difficulty with Kazaa.
“It’s extremely hard to build a company with a product that everyone loves, is free and has no business model, and then to innovate a business model,” Zennstrom said in an interview.
"If you have a product that works it's important to scale (up) the business as quickly as possible," said Zennstrom, named by Time Magazine in 2006 as one of its 100 most influential people.
Skype was sold to eBay (News - Alert) Inc., for roughly $3 billion in 2005 and was later bought back in 2009 by a consortium that included Zennstrom. Later, in 2011, it was sold for $ 8.5 billion to Microsoft (News - Alert) Corp., which made Zennstrom a multimillionaire.
He has invested in a few companies in northern Europe including Finnish company Rovio and Halio, a London-based start-up that raised $20 million. It has developed an app that connects passengers with taxi drivers.
In addition to its London office, Atomico also has offices in Turkey and Brazil which have emerging markets with growing middle classes eager to buy Internet services and shop online. Zennstrom is eager to focus on such emerging markets and wants them to be a larger part of Atomico's portfolio in the future. He believes that emerging market growth is fuelling a new breed of optimism and ambition. More than the latest gizmo or global Internet trend, Atomico is more interested in savvy businesses with talented leaders, who can take advantage of the growth in nascent sectors such as e-commerce.
"It's a much more of an entrepreneurial spirit (in Turkey and Brazil) compared to southern European where it's a depressed mindset," he said.
According to Zennstrom, getting investment today is far easier than when he started Skype. Today, the best ideas and talented entrepreneurs can easily secure funding with several investors interested in them.
"There was really no IPO market and it was not really accepted for founders to sell some of their shares to get some money off the table," he said, adding that before Skype was sold to eBay, he could not even secure a mortgage on an apartment.
"I think we made the right decision for the time in terms of selling (Skype)," he said. "Today as an entrepreneur you have more options."
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Edited by Brooke Neuman
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