The worldwide presence of Silicon Valley keeps on increasing as it is not only known for its exciting AI labs and consumer platforms, but it is also the quiet home to smaller firms from the Bay Area which go wherever their customers and partners in manufacturing take them. Here you must look at Athena Technology Solutions which is a Fremont tech company specializing in manufacturing execution systems (MES). Athena has opened its first European office in Porto, Portugal.
Founded in 2011, Athena has about 200 employees working in the US and has delivery centers located in India. Its primary business is selecting, implementing, integrating, and maintaining MES technology and other software, such as PLM, ERP, and managed services to large global manufacturers from the semiconductor, electronics, medical, solar and battery industries, as well as other high-tech sectors.
Being set in Porto, the company will be responsible for selling its products and delivering services to clients in Europe. It has only 6 local employees at the moment but hopes to employ around 20 people within the first year and have a total staff of 100 people after five years. Besides, the company intends to gain five new clients during the current fiscal year.
According to founder and CEO of Athena, Senthil Ranganathan, Europe has been seen as the natural next destination since the demand for Manufacturing Execution Systems is concentrated in the USA, Europe, and Asia; proximity to the work being done is key. Porto boasts strong technical talent, technology ecosystem, and accessibility of major partners such as Siemens, Critical Manufacturing, and Twinzo.
The European operations are headed by the managing director and head of global delivery Sachi Javli with Ranganathan being closely involved in operations. The company is recruiting project managers, program managers, developers, and sales people in Portugal and other countries in Europe with the first expansion of the office likely to happen in Germany.
This action supports the trend in which Bay Area companies, especially those focused on serving the industrial and deep-tech clients, regard international market presence as necessary for operations rather than an optional public relations strategy. The manufacturing capacity of Europe, the market regulations, and the network of tech suppliers result in the type of market that cannot be reached from California only.
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At the same time, funding of the deep-tech sector in Europe is re-emerging, and the region has had one of the best performing quarters in the last four years this quarter. Therefore, despite the fact that many successful companies in Europe now work with the U.S. acquirers, advancement hubs in Germany, France, Scandinavian countries, and others continue to enrich every field with bright talent and firm technologies.
Portugal, and Porto in particular, has been a preferred destination for such locations due to its combination of competitive talent costs in comparison to cities like London, Munich, or even the Bay Area, decent technical universities in the region, improving infrastructure, and geographical proximity to the rest of Europe.
Partners of Athena have already created a European presence, so having a local office would decrease the distance between implementation teams and clients and technology vendors alike. Choosing Porto instead of a more evident capital city also shows that smaller European cities with specific sectors can compete with the Bay Area for the business of the company when the business plan does not focus on consumers.
For Silicon Valley, there are both positives and negatives associated with this trend. In one sense, the trend helps extend the reach of Silicon Valley to industrial digitization and Industry 4.0 systems that will determine the future of the factory floor. In another sense, it serves as a reminder that just because something is software or just because something works at the consumer scale does not necessarily mean that it will work in more complex multi-location manufacturing settings. Those firms that keep their headquarters in the Bay Area but establish real capabilities outside the region will be better positioned than mere sales offices.
It is still debatable whether this expansion is complementing or competing with Europe’s highly developed state in deep technology. To date, a lot of European startups still seek funding and growth opportunities in the West, while American industrial companies do the opposite looking for clients and talents in the East.
In the long run, it is more realistic to expect that there will emerge an elaborate system of specialized nodes instead of a single city regaining the title of the capital of innovation. Athena’s decision to invest in Porto is a small but efficient contribution to this system, showing that Silicon Valley is still opening new markets for its products and services worldwide and more specifically within the production systems.
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