A new tech hub in Saudi?

SOURCE: Startup Bahrain

Time: 3 April, 2018

Saudi Aramco is reportedly in talks with Google’s parent company Alphabet Inc, to build a new technology hub in Saudi Arabia.

The joint venture could see Alphabet lending a helping hand to the state-owned oil giant for building high capacity data centers all around the Kingdom.

There is no confirmation on whose data the centers would house or who would control them. Also, the size of the venture, if it happens at all, is still a mystery. However, it is certain that it will be big enough to be listed in Saudi Arabia’s stock exchange.

Needless to say, the partnership will help Saudi Arabia to move in the right direction and fulfill the government’s vision. Saudi’s Vision 2030 is heavily focused on the strategic development of digital infrastructure that will add to the ongoing economic diversification process.

Meanwhile, Saudi is not the only country in the region aiming for ties with large tech companies to boost domestic digital infrastructure. In September 2017, Amazon Web Services (AWS) announced on launching data centers in Bahrain by early 2019.

As seen, countries across the region are looking to innovate in order to grow their economies, and pursue their vision plans, such as Saudi Vision 2030, UAE Vision 2021, and Bahrain Vision 2030, and cloud technology plays a huge role in achieving that.

ru

 

Saudi Arabia’s booming entrepreneurial ecosystem was at the centerstage at the Wharton MENA Conference 2018

SOURCE: Startup Bahrain

Time: 3 April, 2018

The King Abdulaziz City for Science and Technology (KACST), represented by Badir Program for Technology Incubators and Accelerators was on a roll last Friday at the the 7th Annual Wharton MENA Conference. Held at Downtown Manhattan, New York, the event saw the Saudi delegation drawing the global community’s attention to all the positive changes that have transpired in the Kingdom’s entrepreneurial ecosystem over the past few years.

The delegation also demonstrated the various steps the government and private sector have undertaken to turn Saudi into a hotbed for entrepreneurial success.

The Wharton MENA Conference is one of the most significant events that see business leaders, investors, entrepreneurs and government agencies from across the Middle East and North Africa get together to network and discuss the various opportunities and challenges that await the region’s business. The 2018 edition of the conference was held under the theme “Inflection Point: Finance and Technology in a Re-emerging MENA.”

Just like in the past, the conference this year consisted of several different sessions with different subject matter including:

  • The Emergence of VC as a Tool for Innovation and Sustainable Growth.
  • Chasing an Arabian Unicorn: Is the MENA Region the Next Place to Look for $1B Companies?
  • Setting the Stage for a New Way to Do Business? A Discussion on the Economic & Legal Reforms Needed to Drive the Future of Entrepreneurship, Tech, and Finance in the Region.

While speaking at the Technology and Entrepreneurship session, CEO of Badir Program Nawaf Al-Sahhaf, highlighted the newly rolled out government legislations and initiatives that have so far played an instrumental role in creating an entrepreneurship-friendly environment in Saudi Arabia.

ru

In pictures: Arabian Business StartUp Academy

SOURCE: Arabian Business

Time: April 01, 2018

A hub for conversation about the latest business opportunities, start-up disruptions, funding deals, legal and regulatory steps to follow, and much more.

ru

ArabNet Launches KSA Innovation Report

SOURCE: Arabnet

01 04 2018

Today at Arabnet Riyadh, we are excited to share with you the launch of the “KSA Innovation Economy – Tech Startups 2017″ Report. The report is designed for anyone interested in investing in the Saudi Arabian tech startup scene, interested in supporting or launching an incubator, accelerator, or mentorship program, and interested in the entrepreneurial ecosystem in Saudi Arabia in general.

A TRANSFORMATIONAL ECONOMY

An Entrepreneurship Ecosystem
Daniel Isenberg, a Professor of Entrepreneurship Practice and founding executive director of the Babson Entrepreneurship Ecosystem Project, is the main creator of what is known as Babson Global Domains of the Entrepreneurship Ecosystem. Isenberg refers to this model as an ‘entrepreneurship ecosystem strategy for economic development.’

Inspired by Babson Global Domains of the Entrepreneurship Ecosystem, the research analyzes Saudi Arabian tech startups through the lens of the model’s six pillars. These pillars include the following: ease of access to funding, type of support received from the ecosystem, ease of access to talent and tech skills, type of infrastructure available, ease of access to markets and customers, and finally type of regulatory framework challenges.

11

THE STUDY: OBJECTIVES AND METHODOLOGY
This research focuses on measuring perceptions of Saudi Arabian tech startups on the challenges facing the entrepreneurial ecosystem. The study aims to highlight the gaps and strengths of the ecosystem. The results of the report will help vested stakeholders make informed decisions in their investments, programs, and projects. 

The research targets owners of technology and digital startups based and registered in Saudi Arabia, including both equity and non-equity based startups. The sample is comprised of respondents who are startup founders, co-founders, partners, and employees with equity.

Respondent profiles reveal that majority of the surveyed are dominated by male participants (80%). Half of all surveyed are mainly in the more mature age bracket of 31 years to 40 years old (49%) suggesting that the sample constitutes serious entrepreneurs. More than half of the surveyed respondents (58%) are the founders of the startups.   

The Distribution of Respondent Profiles

2

OVERALL ECOSYSTEM STRENGTHS AND WEAKNESSES
A quick look at this figure highlights the two biggest impediments that roughly five of every seven tech startups face: access to funding (71%) and difficulties in locating local Saudi Arabian talent (71%). Half of the startups surveyed claim technological infrastructure (48%) as a positive aspect of the ecosystem, while a quarter of the startups identify attracting new business (26%) as a strength.  

Ranking Entrepreneurship Ecosystem Domains

3

ACCESS TO FUNDING
Aside from angel networks, tech startups in Saudi Arabia remain mainly dependent on non-equity funding, whereas over half depend on personal savings (56%). Saudi Arabian tech startups are not leveraging their access to equity funding and approximately one out of every ten startups are dependent on non-equity sources, such as competitions (11%) and bank loans (11%).

When it comes to equity funding, one fourth are angel networks, which is by far the most popular venue for financing (24%). Meanwhile, one out of every ten startups access accelerators (11%) as a source of equity funding.  These findings reflect, first, the challenge of raising equity in Saudi Arabia and, second, a possible cultural aspect of being accustomed and more familiar with non-equity sources. This is a clear market opportunity for both accelerators and venture capital funds. 

Source of Tech Startup Funding

4

In line with the findings of the access to funding figures, more than half of both equity and non-equity financing (55%) are the services with the biggest gap in the ecosystem. The next set of support services that display a gap – of around one third – include mentorship support (such as legal and accounting advice (36%), networking with potential clients (35%), and go-to-market strategy (29%)) and hard skills support (such as product development/prototyping (29%) and technical assistance (29%)). 

The services with the least amount of ecosystem gaps – around one third – include essential, yet basic, services such as business skills’ mentorship and training (33%) and the availability workspace (31%). The gap analysis of support services highlights clear opportunities for funds, mentorship programs, and hard skills training initiatives.

Type of Support Services Available to Tech Startups

5

ACCESS TO TALENT AND TECH SKILLS
The most available skill sets – approximately one half – are the more traditional business skills. Marketing, media, and communication skills rank as the most available at 55%. As skills begin to require more technical based knowledge they begin to display a lower prevalence, such as development and coding (11%), product design (7%), data and analytics (2%). 

Availability of Skill Sets

6

ACCESS TO MARKETS
Approximately two fifths of surveyed startups state the need for support of pull marketing, such as influencer reviews (47%) and word-of-mouth/referral communication (34%), to play a key role in acquiring new business.

Financial considerations reflect two fifths of the support needed to attract new business, such as marketing and sales budgets (43%). Although investors promoting tech startups’ products/services (13%) scores low on the support needed scale; corporate willingness and openness to use startups’ services ranks high at 40%. 

Support needed to Attract Business

7

Saudi Arabia puts buzz back into Mideast startup scene

SOURCE: Arab News

01.04.2018 

LONDON: A maturing investment ecosystem is bolstering startups across the MENA region, according to a new report, with a notable increase in activity from Saudi investment institutions over the past year.
Since 2005, the top 200 funded startups in the MENA region have attracted more than $2 billion in capital, according to a report issued by MAGNiTT, which tracks the development of startups across the region.
To date, the majority of top funded startups in the region were established in the UAE, and the primary financial backers have also tended to be UAE-based.
But a recent uptick in funding from Saudi investment firms points to a developing ecosystem for startups in the Kingdom, according to MAGNiTT founder Philip Bahoshy.
“The Crown Prince has made it part of his Vision 2030 to try to push for further entrepreneurship in the region. While previously it was just an idea, now it is becoming a strong reality,” Bahoshy told Arab News.
As the Kingdom and governments across the Middle East diversify national portfolios away from natural resources and heavy industry, waves of startups providing everything from financial services to digital football fan clubs have burst onto the scene.
Following a number of success stories — including the high-profile acquisition of UAE-based Souq by the American e-commerce giant Amazon — the investment culture supporting startups has developed apace.
In August, Saudi Aramco Ventures, a unit of the Kingdom’s national oil company, invested more than $20 million in the payments startup PayTabs.
The momentum continued this fall when the Saudi-based restaurant management startup Foodics raised $4 million, with inputs from local funds Raed Ventures and Riyad Taqnia Fund (RTF).
The movement in Saudi Arabia follows a broader regional trend, Bahoshy said, where investors are beginning to see meaningful returns on startups established between 2012 and 2015.
Investors across the region have shown a preference for early-stage funding, according to the report, pouring more than $400 million into Series A funding rounds since 2005.
Still, increasing investment at the earliest stages of the startup cycle remains a challenge. On average, regional startups require over three years to close Series A funding but raise just $1.5 million in the Seed and pre-Seed stages.
Citing the lack of a transparent angel investing community in the region, Bahoshy said that governments and international financial institutions such as the World Bank should help incubate startups in their nascent stages and support local entrepreneurs.
“As more startups enter the ecosystem, you need to continue to fuel the base of that pyramid so (the companies) continue to grow,” Bahoshy explained.
According to the report, Middle East Venture Partners, 500 Startups and Wamda Capital are the most active investors in the region, contributing significant capital to the sector.
E-commerce startups have attracted the most funding to date, generating some $700 million since 2005. But of late, investors have shown a preference for startups providing financial technology products, like remittance payments and peer-to-peer lending.
Bahoshy said that startups providing solutions for broader regional challenges such as sticky logistics and cross-border banking frictions stand the best chance of attracting meaningful investment.
More than half of the top-funded startups in the MENA region were founded in the past five years, suggesting a momentum around financing entrepreneurship that has not seen previously been seen.
Broadly speaking, Bahoshy said the outlook for startup funding across the region was one of cautious optimism.
“The general trend is positive. We’re beginning to see new entrances into the space (including) Saudi venture capitalists and international investors,” he said.

 

 

Women’s Economic Forum KSA 2018 starts today under the theme “Let’s Talk About Tomorrow”

SOURCE: Startup Bahrain

Monday, 19 March 2018

As the Women’s Economic Forum KSA 2018 kicks off in Riyadh on March 19, the event will see business leaders, investors, government officials, entrepreneurs, and artists getting together to discuss various issues pertaining to Saudi Arabia’s economic transformation.

This year, the forum will be hosted under the theme “Let’s Talk About Tomorrow.” Supported by Saudi Aramco, the forum focuses on expediting the ongoing process of women empowerment, while simultaneously facilitating discussions on a diverse range of topics and fostering cross-sector collaborations. It also provides a platform for business in the KSA to join forces and explore different avenues for diversification and investment opportunities.

When it comes to women empowerment, the forum conducts multiple sessions to explore new opportunities for women in different sectors and niches. The ultimate objective of these sessions is to debate, discuss, and brainstorm to enable greater participation of women and youth in Saudi’s economy.

Overall, there are five key pillars that collectively form the essence of the Women Economic Forum KSA:

  1. Economic Empowerment
  2. Innovation,
  3. Saudization,
  4. Diversity and Inclusion (D&I) and
  5. Entrepreneurship

And yes, the forum is also headline-grabbing given that it brings together a pool of really high-profile business leaders and public figures.

The number of women-owned tech startups in Saudi is steadily on the rise

SOURCE: Startup Bahrain

Tuesday, 6 March 2018

New data released by Badir Program for Technology Incubators and Accelerators revealed that the number of women-owned tech startups in Saudi is steadily on the rise. This is evident from the fact that the number of such businesses incubated in the Program during 2017 increased by a whopping 144%.

The Program, which represents the King Abdulaziz City for Science and Technology (KACST), further added that 44 of these newly incubated startups are active in the fields of software, communications, smart device applications, and e-commerce.

Badir also predicted a further rise in the establishment of Saudi startups in the tech niche, which is likely to be accompanied by innovations and developments in these companies. Among other factors, this accelerated growth can be attributed to growing emphasis by the government to establish the tech and communication sectors as the backbone of the country’s economy in the foreseeable future.

It is worth mentioning here that the number of projects incubated and completed since the launch of the Badir Program until the end of 2017 stands at a staggering 239. The companies incubated by the program has so far generated more than 1,600 jobs for Saudi youth — including both part and full-time jobs. Meanwhile, the total number of registered product/service providers delivering their solutions using smart apps has gone all the way up to 202,827.

Badir wants to encourage even more women to take the entrepreneurship route by organizing dedicated training programs, workshops, and other activities for aspiring women business leaders.

Women-owned tech startups make waves in Saudi Arabia

SOURCE: Taha Wultech

King Abdul Aziz City for Science and Technology (KACST)’s Badir Program has announced that the number of women’s businesses incubated by the programme grew by 144 percent in 2017.

King Abdul Aziz City for Science and Technology (KACST)’s Badir Program has announced that the number of women’s businesses incubated by the programme grew by 144 percent in 2017.tech startups

Launched in 2007, the Badir Program, is a national programme aimed at accelerating the growth of emerging technology based businesses in Saudi Arabia.

Out of the number, 44 companies are active in the fields of communications, software, e-commerce and smart device applications, said CEO Nawaf Al-Sahhaf in a report by Arab News.

The Kingdom is encouraging innovation and technical development in startups, and expects the sector to play a vital role in the economy.

Al-Sahhaf said the programme is supporting the ambitions and initiatives of Saudi female entrepreneurs, helping them participate in local and regional conferences, and providing them with women-only offices to conduct workshops that prepare them to efficiently manage their businesses.

In a statement, Badir forecasted an increase in the establishment of Saudi startups and a promotion of technical innovation and development in these companies as the government sees a prominent role of this sector in the future economy.

Al Sahhaf described the growth rate of women’s projects incubated by the programme as “good” compared to the past five years, stressing that the programme has contributed to supporting the ambitious and innovative initiatives and ideas of Saudi women entrepreneurs and providing them with an appropriate work environment through the offices specialised in the preparation, habilitation, training and workshops, enabling them to run their businesses efficiently and effectively and helping them to participate in local and regional conferences.

Al Sahhaf further said that Badir Program seeks to raise awareness of Saudi women in technical entrepreneurship and promote the entrepreneurial culture through the organisation of workshops, training programmes and various meetings for female university students, as well as participating in events and activities of universities to raise awareness on the importance of technical projects.

He also encouraged Saudi women entrepreneurs who wish to turn their technical ideas into successful investment projects, to communicate with the programme, which in turn will provide the logistics for their projects, provided that the ideas are innovative in order to obtain the technical and advisory support.

The programme will then provide the project’s premises, grant access to modern and sophisticated facilities and factories and create the right environment.

Badir has incubated 239 technology projects since its establishment until the end of 2017. Those projects have created some 1,615 full-time and part-time jobs for Saudi youths.

tr

Amman-based ‘liwwa’ secures investment from Dutch development bank FMO for its P2P lending platform

SOURCE: mena bytes

Jordanian startup ‘liwwa’ has secured investment from Dutch development bank FMO, the bank announced earlier today. The details of investment were not disclosed.

Founded in 2013 by Ahmed Moor and Samer Atiani, liwwa offers simple financing to small and medium-sized businesses through its digital lending marketplace. The loans are offered through the participation of individual investors. The startup that was incubated at Harvard University’s Innovation Lab has issued more than 9.2 million in financing across 245 loans since its inception.

Speaking about the funding, liwwa’s co-founder and CEO Ahmed Moor said: “Being able to count FMO among our partners is a great honour for us. FMO’s guidance and support will be critical as we scale the business. We share goals, a vision and a mission in common, which are critical components of any successful partnership.”

The investment came from MASSIF, fund of FMO that it manages on behalf of Dutch government. It provides financial and non-financial resources to small businesses and micro-entrepreneurs by supporting local financial intermediaries and institutions that can contribute to their development. The Fund invests in low income countries and fragile and conflict-affected states with special focus towards rural areas, women, youth and companies .

“Supporting liwwa is an important step for the Fund to further support entrepreneurs in this conflict affected part of the world”, said Jeroen Harteveld, Fund manager of MASSIF.

According to publicly available data, liwwa had previously raised of $4.3 million in three different rounds from Silicon Badia, Dash Ventures, Bank Al Etihad, MENA Ventures Investments and SAT Capital.

The MENA Ecosystem: The Year Ahead

SOURCE:500

FEBRUARY 4, 2018

2017 was a landmark year for the MENA startup ecosystem. That hectic pace of development has continued, even accelerated in the first month of 2018. Having been in the MENA startup space in one form or another since 2007, looking back on what has happened in the past year astonishes me. The rapid pace of development, growth and maturity that took place over the last year is astounding. So, below I wanted to document a few of the main developments I’ve seen from my personal perspective in 2017, which I hope to see continue in 2018.

An increasing government focus on entrepreneurship

TL;DR – Almost every government across the MENA region has woken up and is actively supporting the startup ecosystem.

CROWN PRINCE MOHAMMED BIN SALMAN HAS BEEN DRIVING THE TRANSFORMATION OF SAUDI ARABIA WITH A FOCUS ON TECH AND STARTUPS

Governments across the region have fully woken up this year and have started to actually implement projects to help their nascent startup ecosystems grow. In 2017, we saw the emergence of Saudi Arabia as a key player in the regional startup space, with the focus that Crown Prince Mohammed bin Salman has placed on technology and innovation as a pillar of economic growth. Projects from the SME AuthorityMiSK, and even the private sector have led to the emergence of a real funding ecosystem, and we hope to see more in the next year with the launch of the SMEA Fund of Funds program.

Bahrain has also launched the Startup Bahrain initiative, an interesting collaboration working both from the government’s perspective and forming a grassroots movement on the ground. This, in addition to a unique fund of funds program and afintech sandbox environment has led to Bahrain’s emergence as an interesting ecosystem in the GCC.

HH MOHAMMED BIN RASHID, RULER OF DUBAI, HAS SPEARHEADED MANY TRANSFORMATION PROJECTS WITH A FOCUS ON STARTUPS AND TECH

The UAE has had some significant developments over the last year, with several initiatives not only from Dubai, but also other emirates such as Abu Dhabi, Sharjah and Ras Al Khaimah. Dubai, with its flagship Dubai Future Foundation, has been a driving force in the region, with projects such as the Dubai Future Accelerator program and Area 2071 leading the way in building a nurturing environment for MENA startups in the emirates.

In North Africa, we saw Morocco emerge as a hub not just for MENA, but with a wider focus on Africa. We’re seeing projects such as a fund of funds launched in partnership with the World Bank to develop a venture capital ecosystem in Morocco starting to take shape, and we expect to see a lot more in the next year. Projects in Tunis, such as the Founders Institute and Flat6Labs, backed by BIAT as a driving force in that ecosystem, are starting to develop more founders at a higher quality than before.

RISE UP SUMMIT IN CAIRO IS A FLAGSHIP EVENT FOR THE WHOLE MENA REGION’S STARTUP COMMUNITY

In Egypt grassroots private sector led initiatives took the lead in building the ecosystem there, with Rise Up becoming a key integrator and supporter across the ecosystem. We saw the launch ofEgypt Ventures, a government backed initiative to support VC funds, accelerator programs and invest in startups, as well as a few new VC funds start to make their first investments, such as Algebra Ventures and Averroes Ventures. A new angel group, Alexandria Angels, was also launched and we hope to see more in the future. The government also launched the Sherketak accelerator program to further support startups in Egypt. The nation has emerged as a true ecosystem, with amazing founders, a healthy funding ecosystem, with active participation from that both the private sector and government sectors entities.

In Jordan, we began to see an increase in momentum, with Oasis500 working on expanding further and the launch of the Beyond Capital fund of funds program and we hope to see more in 2018. With the acquisition of Carriage, the Kuwait-based food delivery startup, Kuwait has now had more $100m+ tech startup exits than any other market in the GCC. The Kuwaiti ecosystem has developed into a strong source of deals and, dedicated, motivated founders, as well as new angel investors actively investing in the region. Qatar was also active in the region through Qatar Foundationand the Qatar Science and Technology Park, with new funds and an enlightened view of not only focusing on Qatar but supporting the development of startups across the MENA region. A new market, Oman, launched the Oman Tech Fund program, a VC fund and Accelerator program, as well as IDO a government and private sector backed VC fund. Oman has always been a great place to visit, and we hope to see more founders emerge from Oman and more founders from the region use it as a base of operations.

What I’d like to see more of however is collaboration and co-operation between the startup and ecosystem project across the region. The issue is that no single market on its own is attractive enough or big enough to emerge. We need to see projects and initiatives that focus on the Arab world and MENA region as a whole, not just country-specific programs.

Societal acceptance and celebration of tech and entrepreneurship

An extremely positive side-effect of the new top-down focus on entrepreneurship, tech and startups has been a greater awareness of our industry, acceptance of being a founder as a career and even significant celebrations in mainstream media related to founders and the ecosystem.

AHMAD ALZAINI, FOUNDER OF FOODICS IN SAUDI ARABIA, ONE OF THE MANY STARTUPS TO GAIN MAINSTREAM MEDIA EXPOSURE

I remember just a few years ago when “startup” and “entrepreneur” were terms of derision and misunderstanding. The large funding rounds and exits we saw in the past year have further helped to show the opportunity in this sector to the wider populace, and I hope to see this trend continue.

Emergence of corporate activity in VC

AMAZON’S ACQUISITION OF SOUQ.COM WAS A WATERSHED MOMENT

With the Souq.com deal and others we’ve started to see regional corporates dip their toes into the startup arena. Majid Al Futtaim (MAF) and Emaar Malls made bids to counter Amazon’s offer, and both have started to become active investors and acquirers for startups in the region

We’ve also seen AlTayyar group in Saudi Arabia put startups and tech as a key part of their strategy after successful investments in Careem and Moasafer.com. UAE Exchange has also made it part of their mandate to invest in and acquire startups that would complement their core business. These are just a few prominent examples, however this is a significant development. In previous years most corporate players in the ecosystem were mostly playing a role as sponsors and as part of their CSR activities.

Emergence of new regional investors

This year saw the emergence of a new breed of active VC investors, widening the pool of capital available to startups. VCs such as Raed VenturesRiyad Taqnia FundVision VenturesSharq VenturesKISP VenturesQSTPOman Technology Fund (OTF)Faith Capital and more.

I’m hoping this trend continues, as more players will help more startups get funded and widen the pool of capital available across the region.

Increasing interest from outside investors

In 2017 we saw investments in the region from investors in China, South Korea, Japan, South-East Asia and Europe. China’s ride-hailing giant DiDi Chuxing and Japan’s e-commerce conglomerate Rakuten invested in Careem. Jollychic has made a few investments and GS Shop, South Korea’s international home shopping and e-commerce giant, is actively looking at the region.

I believe we’ll be seeing more Asian investors enter the region as they see the parallels between the MENA region and Southeast Asia. Investors from Japan, Korea and China have  played a significant role in the development and growth of the South East Asian market. We will likely see these investors as active acquirers, or late stage (Series B+) players, as they have been in Southeast Asia.

European investors are also taking a closer look at the MENA region, seeking  to expand out of low growth areas into the high growth and opportunity in the region.

More dealflow/ better deals

This was the best year yet for deals, both in terms of quality and quantity. Founders in the region have matured and moved away from trying to raise funding for ideas. We are seeing fewer part-time founders or “wantrepreneurs”, and more founders that launch, get traction, and build real businesses first and then raise funding. I love this.

That’s not to say this increase in dealflow hasn’t come with a downside — I’ve seen several deals with less than scrupulous founders taking advantage of new investors by raising large amounts of money based on nothing more than pitch decks with a few sexy terms like “blockchain” , “fintech” or “AI” thrown in.

Existing VCs moving up higher in the food chain

As some of the first generation of VC funds in the region start raising larger funds, we’re seeing a natural progression towards later-stage companies. Funds that had previously focused on Seed and Series A deals are now looking to deploy larger amounts into Series A and Series B deals. This is not to say that they have stopped seed and early investing, but are doing those investments more to guarantee their allocation and dealflow at the later stages. Being active investors primarily at the Seed stage, this has left a bigger opportunity for us to fill. This has also benefited the ecosystem as the Series A and Series B gap has started to get filled, hence we’re seeing a lot more series A deals taking place.

500 Startups MENA year in review

OUR STARTUPS IN OUR FIRST MENA FOCUSED PROGRAM

At 500 Startups, we’ve had an exciting year, with the first closing of our MENA focused fund at $20m, as we continue to raise to hit our $30m target. We launched our first growth-hacking Dojo Program for post-seed / pre-Series A startups, with nine startups that have successfully completed the program.

We’ve completed more than 30 investments, and emerged as the most active VC fund in the region within less than a year. We hope to continue to play a significant role in helping to develop the regional ecosystem, invest in great startups, and help bring relevant Silicon Valley knowledge here to continue to accelerate our region’s growth and potential.

My hopes for 2018

I don’t like to make predictions, I like to work to help make a change. There are three main areas where I’ll be actively working on this year to help develop the regional startup ecosystem.

A MENA jurisdiction for startups

I hate the fact that I have to ask startups based in the region, from the region, targeting the region, to incorporate in the BVI or Delaware to ensure we’re able to have the most basic protections as investors.

I would like to see an onshore jurisdiction emerge as a de-facto option, a well-understood and accepted place for startups and investors to use.

I’m hoping that 2018 is the year we see this happen, along with a standardisation of equity and convertible notes documents. We’re hoping to work together with regional law firms and jurisdictions in the region to see this happen.

LPs

We’re starting to see several government-backed Fund of Funds programs emerge, which are a great help, as well as international development finance agencies playing a more active role.

However, we have yet to see the private sector play a significant role as LPs in regional VC funds. Many of the family offices and corporations in the region want to invest directly, and the larger sovereign funds are tasked with diversifying out of the region, and want to deploy funds which are too big for any of the VC funds in the region to absorb.

I am hoping to see more regional family offices and corporations look towards playing a role more as LPs and potential acquirers of startups, rather than trying to do direct deals themselves.

M&A activity

This is the big one – I hope to see greater regional M&A activity in 2018.

The MENA region, even in more traditional industries, has been weak in consolidating smaller players into potentially global competitors. You see this in many industries such as the financial sector and insurance, as well as trading and manufacturing. My hope is that the new entrants into the startups and tech ecosystem will take a more active, positive view towards acquisitions and consolidation.

This will become a key driver as the regional ecosystem continues to develop.The emergence of several more regional acquirers would lead to more exits and another transformative year for the MENA startup ecosystem.

The road ahead looks bright

The changes over the past year and the pace of development and focus on the entrepreneurial ecosystems in the region have led to a simple conclusion: 2017 was a great year for MENA startups and this year looks to be even better!