Entrepreneur of the Week: Fashtory’s Alanoud Al Mubarak

Apr 27, 2018

The fashion app that supports emerging designers and tackles current challenges while offering a free-to-user service

Alanoud Al Mubarak saw the need for a platform that connects fashion buyers with designers, so decided to launch a non-transactional online navigable directory based in one of the region’s most promising yet untapped markets, Saudi Arabia.

Fashtory, which operates in over 21 countries including the UAE, boasts products ranging from bespoke clothing to abayas and shoes. Al Mubarak tells Arabian Business how the app supports emerging designers and tackles current challenges while offering a free service.

Why did you decide to launch Fashtory?

I created Fashtory because I felt there was a gap in the market for a platform that connected up-and-coming designers in Saudi Arabia with interested buyers. I personally love travelling and finding unique pieces wherever I go. Following conversations with friends and family, we agreed that the current process of scrolling through Instagram or relying on word-of-mouth was too time consuming and failed to connect designers and buyers efficiently.

I created Fashtory to bring both together, giving designers a chance to become the next big thing while helping fashionistas get their hands on unique products. As for the name, it’s a simple combination of the words “fashion and “directory”, and that sums up what the app is for.

What were some of the challenges you encountered while setting up Fashtory, particularly as it is a platform that doesn’t really have a benchmark here?

The greatest challenge we encountered was differentiating ourselves in the market and positioning Fashtory as a directory rather than an online shopping platform. It is entirely non-transactional, and acts as a social network instead, facilitating conversations rather than purchases. With so many emerging e-commerce platforms in the fashion industry, it was easy for Fashtory to mistakenly fall into the wrong category.

What are some of the difficulties you are facing in running the platform?

As with any new mobile platform, maintaining and growing the user base for designers and buyers can be challenging. Fashtory is dependent on an active user base for it to run smoothly. Although we have noticed a fast uptake in a short period of time, encouraging users to regularly check and update their accounts can be a challenge at times.

What is your business model?

Fashtory is built on a subscription basis, charging brands who want to be present on the platform a small fee billed through the App Store and the Play Store. However, since the launch, we have waived the fee until we firmly establish a loyal customer base.

What were you doing before?

Before Fashtory, I was working in our family business, which operates in the industrial chemical sector. I am still working in this role, but developing Fashtory in my spare time. It has been challenging juggling both, but the hard work and long hours are ultimately worthwhile when I see how fast it has grown in such a short space of time. Someday, I hope to be able to concentrate solely on Fashtory. But until the platform is further developed, I will continue to pursue the two ventures simultaneously.

Were you ever afraid to set up your own venture?

Initially, I had reservations, but I was always quietly confident that Fashtory would become a success. Sometimes the greatest opportunities in life come with a risk. I knew that in order to develop the platform, I had to take an initial leap of faith.

What is the best advice anyone has ever given to you?

The road to success is full of twists and turns, but one should always remain confident in their ability to make their dreams a reality. If you are focused and dedicated, your hard work will eventually pay off.

This article was first published in the Arabian Business

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Nine Saudi teams in Oman Arab Startup Competition

SOURCE: Arab News

Time: April 18, 2018

JEDDAH: The nine winners of the MITEF Saudi Startup Competition are participating in the 11th Arab Startup Competition, which will be held on April 19 at the Oman Convention and Exhibition Center. The competition is in partnership with the founding partner Community Jameel, and in collaboration with strategic partners Riyada, Omantel, and Zain Group as a digital partner.
The participating Saudi teams are Quantum Solutions, Avokado and Ironix, winners of the startup track; Labayh, Aquaponica, and Blooming Bs from the social enterprise track; and Duleb, Cucumber, and Qisma from the ideas track.
The Arab Startup Competition is yet another annual competition that celebrates Arab innovators, who see it as a platform to showcase, test and develop their creative ideas and skills. Cash prizes exceeding $160,000 will be distributed among the nine lucky winners, three per track. Beyond the cash prizes, all 84 semifinalists will benefit from advanced training sessions, personal mentorship and guidance, as well as media visibility and excellent networking opportunities. AN, Jeddah
The Arab Startup Competition will culminate in a two-day event on April 18 and 19, 2018 in Oman, with the announcement of this year’s winners set to take place during the final award ceremony.

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Google creative hubs to kick-start tech training for Saudi students

SOURCE: Arab News

April 17, 2018

LONDON: Five Google innovation hubs to be set up across Saudi Arabia will offer advanced tech training to a new generation of students.
The Saudi Federation for Cybersecurity and Programming signed a final agreement with Google on Tuesday to set up the hubs, which will provide training in mobile applications, artificial intelligence and software development.
Google’s first center will be established in Riyadh at the ITU headquarters and will teach up to 40,000 students per year.
The agreement also provides educational and technical materials and advanced technology curricula, as well as establishing laboratories for students to innovate and create under the supervision of IT professionals, who will offer support in advanced software research and artificial intelligence.
Students as young as 8 will be able to join the Google program, which will bring together experienced speakers, specialists, practitioners and entrepreneurs.
The final agreement was signed by the Chairman of the Saudi Federation for Cybersecurity and Programming, Saud Bin Abdullah Al-Qahtani, and Google’s President for Europe, Africa and the Middle East, Matt Prater.
Al-Qahtani said the agreement would not have been possible without the vision and support of Crown Prince Mohammed bin Salman.

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Start-up of the Week: Tamashee: A luxury footwear brand that blends charity and tradition

SOURCE: Arab News

Time: April 16, 2018

 

JEDDAH: Emirati Mohammed Kazim and Saudi Muneera Al-Tamimi are the brains behind Tamashee, a luxury footwear brand with a charitable element based in Dubai with multiple locations in Riyadh and Jeddah.
Tamashee has taken the Arabian sandal, commonly known as madaas or zbairiya, and revolutionized its comfort and fashion style while preserving its strong Arab cultural identity.
Kazim said: “We are reviving the forgotten cultural components in a contemporary manner.”
The brand is driven by three social aspects: “Preserving Identity,” “Representing Culture” and “Coloring Lives.” The latter is a motto attributed to its most important value, its charitable feature.
By donating some of the profits to special-needs organizations, it increases social awareness and amplifies their global voice.
Kazim understands the importance of establishing a business that continuously benefits society. For Tamashee, it is all about giving back.
Media reports quoted him as saying: “A portion of the proceeds from every purchase of a Tamashee product directly funds projects that aim to increase awareness of people with Down syndrome.”
He constantly finds product inspiration through his extensive travels. It is paramount to the brand’s identity.
He collects stories, traditional colorful design patterns, techniques and materials, and incorporates them into a product.
Examples of this can be seen in how Tamashee includes the hijri date onto every sandal, and integrates metal rings in place of the buckle for the women’s line.
The signature turquoise sole lining on its footwear products aims to revive a traditional color that was prevalent in the region’s past.
From clothing to architecture, turquoise is deeply rooted in the culture of the Arabian Peninsula.
Tamashee integrates a subtle yet culturally rich story in every collection piece. Its products are handmade in Spain using the highest-quality leathers that are both natural and naturally dyed.
The leathers — from camel, cow, ostrich and lamb skin — are collected from the UAE, Italy, South Africa and Spain, respectively.
Tamashee has expanded its product range to include leather sunglasses, shaving kits, laptop sleeves and other accessories.
Along with the online store at www.tamashee.com, its products can be found at Rubaiyat in Jeddah’s Stars Avenue Mall, and at Draft Thoughts in Riyadh’s Centria Mall.

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Beware: Saudi pranksters are on the prowl, and they’re ready to catch you out

SOURCE: Arab News

Time: April 16, 2018

JEDDAH: Although people have been pranking each other for thousands of years, the age of the internet paved the way for mainstream video-sharing websites such as YouTube, Instagram and Snapchat, ushering in a global platform of viewers for pranksters. Famous YouTube and Instagram pranksters are quickly establishing themselves as the new generation of self-made celebrities.
They have built a fan base by creating entertaining user-friendly content, even if at others’ expense.
Pranking is entertaining on multiple levels because it serves to manipulate social power, cultural norms and status hierarchies while initiating strong human emotional responses.“Not only is a good prank harmless, but like a good story, it reveals an essential truth that would otherwise be hidden,” said American author Mac Barnett. “It is a great way to indicate the underlying absurdities of the world.”
There can be a lot to learn about human responses through this sometimes-cruel engagement. Since pranking is heavily influenced by societal and cultural norms, they function as a release of pent-up societal tensions.
Confusion, embarrassment, flattery, fear and ultimately laughter are sought when individuals are being pranked.
That feeling of losing control or being rendered powerless in a situation can illicit powerful human responses.
A well-constructed prank is a sort of social experiment on human emotions under the guise of seeking laughter.
Saudi Arabia, too, has a culture of pranksters to contribute to this trending industry, in Mohammed and Murad Salem, and Hassan and Hussein bin Mahfouz.
The two sets of twins have garnered nearly 2 million subscribers and followers combined on YouTube and Instagram by uploading entertaining skits and pranks in the Kingdom and abroad.
“Pranks have been our hobby long before social media. Now with social media, the idea has become more of a prank war between us as twins,” the Salems told Arab News.
“In Saudi Arabia, pranks are far from dangerous or intimidating. They rely on public embarrassment. We find they’re usually popular among most society groups, especially youngsters, and although not everyone will like our pranks, most encourage us to keep doing them.”
But it is imperative to not just look at pranking through rose-colored glasses, as it can deeply affect and emotionally scar some victims.
Since pranking can often involve social humiliation, a three-way relationship between the one who humiliates, the victim and the witness can create a helpless power dynamic for emotionally sensitive individuals.
“The reaction we often get from friends and family is positive,” the Salems said. “Although we don’t always agree on how bad the pranks should be, we make sure not to cross any red lines, as certain pranks have led to serious confrontations.”
Saudi prank culture has always existed, but it is only now starting to garner exposure and attention via social-media platforms. An added incentive is the potential income these content creators can accumulate via advertising revenue.
But the Salems aim to use their fame from pranking as a stepping stone to much bigger ventures. “We want to expand and enter the fields of media and acting,” they said.
“Pranks were one of the reasons that led us to fame, but we also sing. We’re currently studying some ideas to create sketches that portray everyday situations in a comedic way.”

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Here is what Saudi Arabia is doing to boost its startup ecosystem

SOURCE: Startup Bahrain

Time: 14 April, 2018

Saudi is among the friendliest places in the Middle East to start a business. However, opportunities for emerging businesses in the Kingdom have been sent through the roof after a slew of structural reforms and initiatives were recently announced by the government with adequate backing from the private sector.

A quick look at Saudi’s startup support ecosystem and it becomes apparent that the country’s ambition of establishing itself as the next Silicon Valley may not be too far-fetched at all.

The number of accelerators, funds, and incubators has increased substantially over the past few years, and so has the frequency of business development centric fundraising and networking events targeted at startups.

But that’s only the tip of the iceberg. The Kingdom has announced a fund worth $45 billion to invest in promising technology ideas from the GCC region and the rest of the world. Granting of citizenship to a robot, Sophia, was definitely a message to drive the point home that it aims to establish itself as a major technology and innovation hub. And steps have already been taken to attract startups from across the world, with more announcements to follow up soon.

Startup, an aptly named platform where emerging businesses can discuss their needs and ideas, has revealed that the Kingdom’s government is preparing to walk the extra mile to ensure that obtaining a business license in the country becomes much easier for overseas businesses. Considering that technology is one of the key non-oil sectors that the government is increasingly focusing on, we can expect more good news on that front in the foreseeable future.

Apart from that, the country is also looking to introduce a radical transformation of the Public Investment Fund (PIF), which incidentally happens to be the largest sovereign wealth funds in the world. The ultimate objective is to make PIF a key stakeholder in the tech space.

According to media reports, Japanese multinational telecom giant Softbank Group is considering increasing its investment in the country’s tech sector to a whopping $25 billion in the next three to four years. A large part of this investment – somewhere around $15 billion – could be allocated in the development of a new city larger than Dubai and have more robots than humans.

So what do you think about the Kingdom’s ambitions? Are they on the right path or do you think more needs to be done to make it Middle East’s Silicon Valley for tech startups? Let us know.

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Saudi banks will now provide more funding to private businesses and SMEs

SOURCE: Startup Bahrain

Time: 14 April, 2018

In a recently held open discussion, the stakeholders in Saudi Arabia’s startup ecosystem got together with decision makers in the banking sector to discuss the challenges startups face while dealing with banks.

During the discussion, it was revealed that Saudi banks have provided funds worth SR 1.4 trillion to the country’s private sector.

The revelation came from Talal Hafiz, who has been serving the dual responsibility as the official spokesperson of Saudi banks and the Secretary General of the media and banking awareness.

Hafiz also underlined the fact that among all privately held businesses, small businesses contribute only 20% of Saudi’s growing economy. He compared this figure with the SME sector in the US and Europe, which contribute around 50% to the GDP.

According to him, contrary to what many entrepreneurs seem to believe, funding is not the single largest issue facing the country’s startup ecosystem today. Rather, it’s the different regulations set by different government departments including the regulations of the municipality, and the Ministry of Commerce and Investment, that severely limits the potential of emerging businesses.

He acknowledged that while banks are increasingly looking to back the SME sector, they have to look after their own interests as well.

“However let’s be frank, banks cannot support very high risk businesses that might be just ideas in the mind of an entrepreneur, businesses must contribute financially and be committed and show hard work to get the fund,” Hafiz noted.

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Saudi startups have wider funding options amid huge fund volumes

SOURCE: Saudi Gazette

RIYADH — Saudi startups would have a wide range of financing options as funding volumes in GCC have increased steadily, with a lot of fresh money flowing into seed and early-stage companies.

In an interview, Nawaf Al Sahhaf, CEO of Badir, said financing options for these startups include without limitation Venture Capital firms, angel investors, accelerators, and incubators in addition to new alternatives such as crowd funding or even P2P lending platforms.

“These options encourage startups to adopt new alternatives for providing flexible funding opportunities, thus assisting them in building and developing investment plans, he added.

He recalled that five years ago, the vast majority of startups relied on family, friends and business angels to provide the required capital to launch their startups, “However, these are no longer the only options available to entrepreneurs and investors. Nowadays, the entrepreneurs have greater options and we believe that 2018 will bring even more government funds to the mix, and inject the kind of investments that will kick-start a new wave of growth.”

Excerpts from the interview follow:

• Have you seen the market evolved over the past 12 months with respect to investment in tech startups in Saudi market?

The Kingdom of Saudi Arabia has seen a boom in tech startup and investor activity over the last year. In addition, several new funds were announced by the Government and VCs that are committed to Saudi young and dynamic technology companies in the market. In fact, the investment landscape in Saudi (Arabia) 1 1has further developed in 2017, and the market has seen intense activities from established and new players alike. We observe more and more competitive deals in seed and series A.

For example, startup Saudi companies incubated by the “Badir” program were able to obtain investments of about $13 million In the first three quarters of 2017 alone which were led by Saudi finance companies and supported by Gulf and regional investment.

Overall, the startup funding market in KSA is changing rapidly and expected to grow remarkably well, with various investors and steadily growing experience.

• Access to funding is still one of the biggest challenges faced by startups all around the region. How is Badir Accelerator helping startups with that?

Badir Accelerator plans to start financing the start-up technology companies in Saudi Arabia with amounts up to half a million riyals beginning in the first quarter of next year, in exchange for a share of equity. The funding will address on the acceleration phase of those companies.

In addition to the investment financing, Badir Accelerator also offers a range of advisory services that include training, follow-up, guidance and workshops, accompanied by continuous guidance, to develop the entrepreneurial innovations and transform them into tangible projects within 90 working days.

For subsequent financing stages of growth, Badir will serve as a linking platform between investors and entrepreneurs during regular meetings to help fill funding gaps. The initiative aims to speed up the growth of Saudi start-ups for a positive impact on the national economy, increase productivity and create more job opportunities for Saudi youth.

• What do you think of the current ecosystem landscape in KSA?

The ecosystem is very vivid and dynamic. Every day we hear news about successes and innovative ideas in the market, in conferences and competitions. The whole startup environment is growing, but naturally it shows all the signs of a relatively newly established environment.

Considering that technology is one of the key non-oil sectors that the government is increasingly focusing on, the Government of Saudi Arabia has been taking proactive steps to build a strong infrastructure for the Saudi entrepreneurship scene and played a vital role in encouraging innovation and fostering entrepreneurship among Saudis.

In recent years, the Saudi government has devoted significant resources and implemented a range of initiatives to boost the growth of startups and there are currently several government and non-profit organizations that are directly or indirectly supporting the Saudi entrepreneurs. The number of startup supporting organizations, accelerators, incubators, funds, etc. – has increased significantly in Saudi Arabia over the last few years. These organizations and companies are ensuring funding, incubation, training, coaching, mentoring and access to market.

To sum up, the startup ecosystem in KSA has become much more structured in recent years and is expected to grow with the support of government and private sector players and to propel the next generation of start-ups.

Meanwhile, Philip Bahoshy, Founder and CEO of MAGNiTT – the largest startup website for entrepreneurs, investors, corporates and founders in the Middle East – when asked about the best time for bootstrapped early stage startups to raise capital, that founders should expect to bootstrap in their early days. If they require funds they should speak to Friends and family rounds or Angels before pitching to a VCs.

“Therefore, it is essential to bootstrap in the early years of a startup journey. In our MENA evolution report we saw on average that the top 200 funded startups across MENA took 2 years to get to SEED stage and 3 and a half years to get to Series A,” he said.

Excerpts from the interview follow:

• How is venture capital going to help drive the startup economy in GCC market?

Venture Capital funding is an essential piece of the startup jigsaw.

Venture Funding is unique, however in its characteristic. I define a startup as a company that is looking to receive funding from a venture capitalist. This means that they meet several basic criteria for growth 1) a strong founding team 2) a solution to a clear and identifiable problem 3) a clear path to monetization and most important 4) a scalable product that has a regional if not global market.

All of these criteria are essential to be eligible for Venture Funding. Many of these criteria may not be applicable or sufficient for alternative funding channels including debt, bank funding or grants.

Venture Funding is essential to grow startups at each stage of funding where they have yet to break even or require further funding to achieve scale and growth.

Unlike other conventional funding sources they take equity in exchange for funding in the growth of the company.

An understanding of this is required from Entrepreneurs when pitching to VCs to better position themselves when asking for funds.

• In your experience, when is the best time for bootstrapped early stage startups to raise capital, and when is the optimal time in a startups age where VC’s can give capital?

Above I articulated the four basic and preliminary criteria that a VC look for before they undertake basic due diligence on a startup.

Founders should expect to bootstrap in their early days. If they require funds they should speak to Friends and family rounds or Angels before pitching to a VCs.

The VCs role is not to help a startup prove a product market fit or to help them hire their founding team. Their investment is used to scale.

Therefore, it is essential to bootstrap in the early years of a startup journey. In our MENA evolution report we saw on average that the top 200 funded startups across MENA took 2 years to get to SEED stage and 3 and a half years to get to Series A.

Bootstrapping allows a founder to answer three of the key criteria posed:

o MVP – Create your Minimum Viable Product which has shown signs of traction. This shows if what has been created has a product market fit. As well shows that it is a solution to a problem.

o Team – Have you found a co-founder. Have you created a strong founding team that is not incentivized by cash but have skin in the game by taking lower salaries but have stock options that bind them to the company.

o Monetization – Important to be able to show how you monetize or how you will look to monetize. Being able to show a willingness to pay by customers for your product shows that it is not only a solution but has a market value

Finally, you have to show a large addressable market. For any startup to be appealing for a VC you need to show that there is a large market that you are looking to tackle. Do your homework. Look at global competitors. Understand how you look to scale and capture the market.

• Do you think that venture capitalists are growing more cautious about new startups?

The role of a Venture Capitalist is to be cautious about its investments. They are not their to give out free cash.

It is important for an Entrepreneur to understand how a VC is structured. They too have investors in their fund who expect a return on their investment. They have a timeline in which they have committed to deliver and their success and track record will allow them to raise further funds in the future.

Therefore, it is essential for all VCs to do the appropriate due diligence when making an investment in a startup.

The region is still at the beginning of it’s investment journey. VCs in the region, many of whom have only been around for 5 or 6 years maximum, have yet to see many exits. Our MENA Exits report showed that on average it takes startups 7 years to exit. And our recent funding evolution report highlighted that 60% of the most funded startups across MENA were founded between 2012 and 2015. And we saw that it takes 3 years, 4 years and 5 years to raise Series A, B and C respectively. So we have a while before we see many VCs make serious exits from their portfolios.

With successful exits we will see two tangible benefits. 1) VCs appetite to invest at an earlier stage increase as they will have made returns on their initial funds assuming successful exits 2) startup founders of successful companies give back. The so called PayPal mafia effect where founders of the company give back to the ecosystem by Angel investing, starting up new companies or joining board of directors/ advisors to support startups that are still developing.

• How is the investment landscape in 2018 going to look compared to this year?

2017 recorded a larger number of investment deals and more investment in startups, when you exclude Souq and Careem as outliers, than any previous year.

We have also seen the emergence of new VCs funds, especially in KSA as well as incrased interest from international investors interested in investing in the region.

A new trend is also the acquisition or strategic investment of larger Global startups into regional startups. Examples include Amazon & Souq, Didi and Careem as well as Go Compare in SouqAlMal.

At the same time governments continue to push to support startups creating policies and initiatives to make it easier to set up and grow your companies while corporates across the region continue to identify ways of investing, collaborating or supporting startups across MENA.

All of these factors provide a healthy environment for continued growth and support of the startup ecosystem.

However, at all levels of startup funding an increase in capital injection is required to spur on growth and governments need to continue to make it easier for founders to set up through reduced licensing and regulatory cost, employee talent and scale across multiple jurisdictions.

• How many Saudi startups registered on MAGNiTT platform?

To date we have 252 listed on the MAGNiTT platform. We believe there are many more and a key prerogative for 2018 is to continue to growth the platform in KSA to capture the market so as to support key stakeholders, whether they are entrepreneurs, investors, corporates or government when making decisions based on facts and information.

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Start-ups crucial to the future of Saudi Arabia: Officials

SOURCE: Gulf News

Time: 13 April, 2018

Dubai: Saudi Arabia’s economic transformation will be fuelled by start-ups, according to UAE Ministry of Economy officials speaking at last week’s Annual Investment Meeting (AIM) event in Dubai.

As the country moves from an economy largely based on hydrocarbons to one more based on knowledge, the kingdom’s economic Vision 2030 is being driven by Saudi Crown Prince Mohammad Bin Salman.

Mohammad Bin Salman recently concluded a visit to Silicon Valley where he urged the global tech companies to invest in Saudi Arabia and help its economic transformation.

Saudi Arabia’s sovereign wealth fund, the Public Investment Fund (PIF), has been mulling investments in a number of global start-ups in recent years.

Juma Al Kait, assistant undersecretary at the UAE Ministry of Economy, opened the AIM start-up conference on April 11 by introducing Nabeel Koshak, dean at MBSC, Saudi Arabia, as the chief guest.

Koshak, who accompanied the Saudi crown prince on his recent tour around the United States, talked about the transformation of Saudi Arabia’s national economy, and how it was affecting start-ups.

According to a statement, Koshak said that Saudi Arabia cannot afford to be slow as the world changes around them.

He added that start-ups in Saudi Arabia had massive support from Mohammad Bin Salman, as the country attempted to diversify its economy, by giving more importance to small to medium sized enterprises (SMEs) and start-ups.

Alongside Nabeel Koshak was Kevin Cullen, vice-president of innovation and economic development at KAUST in Saudi Arabia.

Cullen said that he sees massive potential in Saudi Arabian students, talking about the social, economic and cultural changes in today’s youth.

Educational institutions in Saudi Arabia are now teaching bachelors and masters students how to pursue a career as an entrepreneur.

“So, failure is part of the learning process. If we are not failing, that means we are not trying,” Cullen said.

Jeddah duo wins $30k in Boston contest

SOURCE: Arab News

Time: April 10, 2018

Trochet, the brainchild of Diana Rayyan and Reem Bakheet from Jeddah for a start-up project on environmental issues, bagged the first place worth $30,000 at the recent Harvard Arab Weekend start-up pitch challenge, 2013, in Boston.
Team Trochet and nine other finalists were given training on how to pitch their ideas for two days before the final event. All the contestants, after the training, modified their presentations for the final round. Each start-up was given five minutes to pitch for their ideas before a panel of judges, besides having to face five minutes of questioning by the panelists on their ideas.
Diana and Reem, founders of Trochet, came up trumps in the finals and were awarded the $30,000 sponsored by Hekma Pharmaceuticals, Jordan.

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