2/24/2012

Turkey's internet tiger shows signs of stirring

The Wall Street Journal - Turkey has that most scarce, yet highly sought-after, attribute among European economies: growth. With this rising tide, is now the time for investors to be contemplating Turkey's growing Internet economy?


Certainly the statistics look good. According to the European Union, Turkey's real gross-domestic-product growth for 2010 was 9%, compared to just 2% for the 27 EU members. It is forecasting that growth for 2011 will be 7.5% against 1.9% for the EU.

 
Turkey has 35 million Internet users—out of a total population of around 77 million—70% of whom, according to research firm Comscore, are younger than 34. That makes the country the fifth-largest Internet audience in Europe. Those users are engaged, spending the third-longest time online in Europe, after the Netherlands and the UK.
Turkey has also embraced social media: It is one of the top five audiences on Facebook and top 10 on Twitter. Furthermore, Turkey's infrastructure is well developed. Credit-card penetration, at some 60%, is higher than the European average of 50%. Online retail is strong and growing fast.


And unlike in Russia, logistics and physical infrastructure are good. Thanks to heavy investment, communication links are good. The third-generation network, at least in major urban areas, is often faster than that found in many other European countries.
Toss into the pot a couple of major exits for Turkish start-ups (South Africa's Naspers acquired a majority stake in Markafoni, an e-commerce site; eBay Inc. snapped up online marketplace GittiGidiyor and Amazon.com Inc. took a stake in flower retailer Çiçek Sepeti), and the arrival of the Russian search engine giant, Yandex, and the picture is starting to look pretty good. Is an online Anatolian Tiger starting to stir?


Turkey has certainly caught the eye of the investment community. That leading venture-capital company Accel Partners, an investor in Facebook, Groupon, Etsy and Spotify, decided to send two people to attend a conference of 300 Turkish startups shows how seriously the country is taken.


With its impressive growth, its alignment with the European Union and its historic role as a bridge between east and west, Turkey is certainly a country of great opportunities. Fortune favors the brave, so for those willing to play a high-stakes game, get on the flight to Istanbul tomorrow. For everyone else, the tiger has just started to stir. Be there when it eventually wakes.

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