ArabNet The Quarterly Issue 5 | Summer 2015 by ArabNet The Quarterly

inside covers.indd 1

5/20/15 8:10 PM

lEttEr froM thE Editor

The Power of DisruPTion Disruption. It’s a word that has been hammered into the business world’s vocabulary ever since Harvard scholar, Clayton Christensen, introduced his theory of disruptive innovation in the 1990s and wrote his book: The Innovator’s Dilemma. “Disruptive innovations are like missiles launched at your business,” writes Christensen. Almost ten years before Christensen, Dick Foster explained the effect of a disruptive force in his 1986 book, Innovation: The Attacker’s Advantage, but failed to give it a name that sticks— to his life’s biggest regret. Lara Chaaya Managing Editor

@ChaayaLara lara@arabnet.me

What piqued the interest in the disruptive force concept was the onset of the Internet age, which shook the core of many big corporate giants. The burst of the Dot-com bubble was a just a minor hiccup. Nowadays, the pursuit of disruptive technologies has become the sacred mission of companies of all sizes. The more you disrupt, the better. And anything that stands in the way of disruption is compared to the Spanish Inquisition. Silicon Valley has come a long way in the age of disruption. Think about what Google Adwords did to online advertising; how Netflix did to Blockbuster; and how Salesforce.com did to Siebel and other CRM companies. Although disruptive forces have been in play for many years, their effect is actually getting even more dramatic than they were fifteen years ago. Companies are competing head-to-head on disruptive technologies, and it is getting harder by the day to keep up with the incredible pace of disruption. At least that is the case in San Francisco, where the age of disruption as we know it has significantly evolved to give birth to what is now termed the Unicorn Club. The same cannot be said about the MENA. The margin of untapped disruptive opportunity is still large in many regional business sectors—from education, to logistics, to health and retail. Yes, we are lagging behind. But instead of lingering on the reasons, let’s focus on the bottom line: Now is the time for startups and companies to create disruption in the region. In this issue’s cover story, we discuss one particular sector that we foresee will soon be disrupted by promising financial technology (Fintech) startups: the banking sector. While some international Fintech startups have crossed the billion-dollar valuation, like the peer-to-peer lending platform Lending Club with its 2014 $8.5 billion valuation, regional startups are following suit and are already showing great signs of success. Whether they will be disruptive or not and reach the same 10-digit valuations as their peers in the West, is a question that we will leave for you to think about after you read the article. Enjoy the summer edition of The Quarterly.

CoNtENt issue 5 UsefUl Apps for TrAnsporTATion A Round-Up of Taxi-Booking Apps for Residents in MENA Industry storIes

Industry news

BusIness

Deloitte’s Technology, Media, and Telecom Predictions for 2015

teCHnoLoGy

Cloud As an enabler of enterprise Innovation and Growth

disrupting Banks Across the MenA

Are Emerging Fintech Startups a Threat to the Financial Sector?

Anthony Butler from IBM Explains How to Leverage PaaS

THE MENA: AN EXCITING PLACE TO BUILD GAMES

MenA smart enterprises and Cities drive digital Innovation

s the Gaming Industry Have What It Takes to Level Up? By Mary-Margaret Walker | @mmwalker

does the MenA Gaming Industry Have What It takes to Level up?

dIGItAL MedIA

What Is your Advice for Creating Great Mobile Apps?

We Ask the Developers

The QuarTerly Summer 2015

Marco Bertozzi from Vivaki reveals the undeniable truth about Programmatic

Facebook’s narain Jhangiani-Jashanma discusses App opportunity in MenA

the top 10 digital Advertising tools for Better Impact

How to Win at talent Acquisition

5 Insights from General Electric for Building Brand Talent in 2015 S

56 44

survival strategies for newspapers in the digital Age

How Brands, entrepreneurs, and everybody else Get your Attention

A Review of Ben Parrâ&#x20AC;&#x2122;s Latest Book: Captivology

An Interview with Nayla Tueni of An-Nahar

58 48

Changing Media Patterns during ramadan

62 entrePreneursHIP

new Middle east startups that should Be on your radar y

What Is the single Biggest Critical Mistake that Could sink a startup?

Meet the Latest Venture Capital Firms to Launch in MenA

Summer 2015 The QuarTerly

Industry storIes

UsefUl Apps for TrAnsporTATion

industry news

A Round-Up of Taxi-Booking Apps for Residents in MENA

delivery Hero Acquires turkey’s yemeksepeti for a record $589M Delivery Hero, the network of online food ordering platforms agreed to buy its Turkish peer Yemeksepeti for $589M (cash and shares), smashing records as the largest acquisition for the food-ordering sector. The amount represents almost half of the total $1.3B Delivery Hero has raised to date. This move extends Delivery Hero’s reach in Turkey, the UAE, Saudi Arabia, Qatar, Jordan, Lebanon, Oman, and Greece. Yemeksepeti has been processing more than 3 million orders each month, growing by 60% year-on-year. These orders will constitute a respectable percentage of Delivery Hero’s global business (10 million orders per month on average). With a $586M investment, Germany’s Rocket Internet owns 39% of Delivery Hero. The company also acquired Talabat.com for $170M as well as 9 other online food ordering platforms, and owns a large share in HelloFood (Foodpanda), which delivers to over 40 countries in emerging markets.

Goldman sachs Leads $100M Investment round for HelloFood The Berlin-based HelloFood (Foodpanda), a leading global online food delivery marketplace, received $100M in a recent investment round led by Goldman Sachs, which included existing investors such as Rocket Internet. This brings HelloFood’s total raised investment since its launch in 2012 to $310M. Goldman Sachs Investment Partners will join the food delivery service’s advisory board. Hellofood recently acquired key competitors in an expansion plan encompassing Russia, India, South-East Asia, Brazil, Mexico, and Eastern Europe. According to Ralph Wenzel, HelloFood co-founder and CEO, the new investment will optimize overall customer experience across 40 markets (more than 580 cities on 5 continents, with over 60,000 partner restaurants). These figures are the direct result of a major acquisition binge that saw Rocket Internet acquire Talabat.com and 8 other food delivery startups across the world.

liwwa secures seed Funding, Will disrupt Banking sector liwwa, the first Sharia-compliant peer-to-peer lending platform, closed a six-figure seed round fund from 3 leading investment groups: DASH Ventures, Bank al Etihad and MENA Venture Investments (MVI). The company wishes to reduce the funding gap for SMEs in Morocco, Lebanon and Yemen (a $250B gap according to a 2014 report by the World Bank and Union of Arab Banks). Omar J. Sati, Managing Director of DASH Ventures, said liwwa will disrupt the banking sector and create a social and economic impact for Arab businesses. “SMEs account for 80% of all economic activity in the MENA, and bring about 40% of employment,” he explained. liwwa CEO Ahmed Moor said they will now focus on the industrial sector and also hinted at a new product related to trading. To date, liwwa has facilitated around 20 loans for a total of $100,000.

The QuarTerly Summer 2015

Careem races on Against uber, Acquires Morocco’s “taxiii” Careem, the region’s leading private car booking service has acquired Taxiii, its Moroccan counterpart. Taxiii’s founder, Yassir El Ismaili El Idrissi, will lead Careem’s development and expansion across Morocco. The move follows Careem’s acquisition of Enwani, as part of its strategy to strengthen its regional position. In under 3 years, the service has reached over 30% growth month-on-month. Careem’s main competition, the San Francisco-based Uber, has also been rapidly deploying across the region since 2009. Careem is present in more cities and has now added a North African market to its roster (alongside non-Arab markets, including Karachi and Lahore). Taxiii is developed by Mobilitech, a Moroccan startup dedicated to mobile technologies. As the country’s first car booking app, it has been downloaded over 6,000 times, and counts over 2,200 users and 100 drivers.

$15M Investment in Quantum Group’s Arabic Content Platform M Publishing, a Lebanon-based digital content creator and distributor (part of the Quantum Group), has already raised one third of $15M in order to set up a new digital platform offering different forms of Arabic content. The platform will include a blend of published material, acquired content, original productions and viewer-created media in Arabic across various formats (film, music, e-books). Beirut-based Levant Investment Bank (LiBank) invested $2.5M into this round, and another $2M were invested by Mercury Media, an affiliate of Quantum Group. The platform and its featured content will be B-to-C, but M Publishing will seek to enter into licensing and co-production deals on its commissioned content, thereby growing a B-to-B business too. Quantum Group is also currently incubating another startup called Mercury Content (a transmedia production firm specialized in cultural themes).

Bank Audi Introduces Wearables to nFC Contactless Payments Bank Audi sal has introduced wearables to Tap2Pay, its range of NFC (near field communication) contactless payment solutions. Using MasterCard technology, Bank Audi allows customers to make credit card payments by tapping an NFC-enabled card, mobile, or wearable device on a dedicated POS terminal. The future of wearables in banking was discussed last month at the Mobile World Congress. Globally, most wearable banking apps currently build on the existing functionality of mobile banking apps, and allow simple actions such as checking account balances. According to market research, smartphones are currently the preferred platform for mobile banking. But wearables will gain momentum as “on-the-go” payment solutions. The use of wearable technology in such an application has the ability to change consumer behaviors because it combines contactless payment convenience with a smart handy accessory. Randa Bdeir, Group Head of e-Payment Solutions and Card Services at Bank Audi sal, said: “NFC contactless payments have a major role to play in the replacement of cash in our region.” Tap2Pay wearables are available as watches or bracelets in different colors, and are currently accepted at more than 3,000 merchants in Lebanon and any PayPass merchant outside the country. Smartwatch adoption is also set to grow. GfK predicts global sales will exceed 26 million units in 2015 (up from 4 million in 2014), and sales in the Middle East and Africa will increase by 6 times to 1.1 million units.

summer 2015 The QuarTerly

Industry storIes

UsefUl Apps for TrAnsporTATion Melltoo secures +$200,000 from

A Round-Up of Taxi-Booking AppsMultiple for Residents top Investors in MENA

Melltoo, Dubai’s mobile-first peer-to-peer marketplace for buying and selling secondhand products, just closed its first seed funding round with a total investment of $205,000. For the first time, several top institutional investors in the GCC came together amicably at the investment table, including Turn8, accelerator WOMENA, and Silicon Oasis Founders (SOF). The investment will be used to launch in-app payment and delivery services by June 2015. The marketplace will also provide a money-back guarantee with every transaction that takes place via the app. The startup will be hosted and supported by Dubai Silicon Oasis within its recently established Dubai Technology Entrepreneurship Center (DTEC.ae).

Berytech and usAId Kick off new $15M startup Fund Berytech launched the $15M Insure & Match (IM) Capital Fund to support entrepreneurship in Lebanon. The fund falls under the Middle East and North Africa Investment Initiative (MENA-II), an innovative 20-year engagement program by the United States Agency for International Development (USAID). The program will promote early-stage startups struggling to secure capital, and will foster improvements in the business ecosystem. The fund was developed in collaboration with the private sector and the $15M capital is divided into 3 equal parts. First, it will match up to 50% of outside capital by qualified early stage investors. Second, it will provide early-stage entrepreneurs with technical assistance and linkages to international markets. The fund’s differentiating factor is a third facet consisting of equity guarantee with an overall ceiling of $600,000. The fund is already operational and Berytech is seeking investors and businesses. 6

The QuarTerly Summer 2015

MeVP Adds Zain to Investor Portfolio in $30M VC Fund Middle East Venture Partners (MEVP) has added mobile communications innovator Zain Group to its investor portfolio and raised $15M of its total projected $30M for its Dubai-based second Middle East Venture Fund (MEVF II). The fund will invest in early stage technology companies and will focus on web and mobile digital plays, e-marketplaces, and B-to-B companies. MEVP now has its first telecom LP and is looking for at least another partner in the sector. “Most of our portfolio companies are looking to leverage telecom operators’ infrastructure and customer base to activate new markets and scale, and so the synergies expected are significant with Zain,” said Walid Hanna, MEVP founder and Managing Partner. The fund has already invested in 4 companies: YouGotAGift.com (Dubai, UAE); TheLuxuryCloset.com (Dubai, UAE); AlTibbi.com (Amman, Jordan); and Lamsa World (Abu Dhabi, UAE).

shopshopMe.com successfully Closes seed round MENA Commerce, a Dubai-based startup focused entirely on the retail industry, just closed an oversubscribed seed round from Arzan VC and top angel investors. The startup aims to become the new Google for Retail in the MENA with its shopping search engine, ShopShopMe.com. It will soon release “Visual Search”, a mobile app that allows shoppers to search and compare products using text or images to find the best prices in malls or other physical outlets. MENA Commerce was one of the 2 winning startups at the GCC Pitch Challenge this year, and was also selected as the Best Technology Startup for 2014 during the Dubai Silicon Oasis TED.

Industry storIes

UsefUl Apps for TrAnsporTATion Lebanese startups Will Fly to London and the World

A Round-Up of Taxi-Booking Apps for Residents in MENA

Thanks to UK Lebanon Tech Hub, Lebanese knowledge-industry startups can now receive UK expertise in Beirut and take advantage of London’s exposure to go international. This new ecosystem is a joint initiative by the UK government’s Trade and Investment department and the Lebanese Central Bank (BDL). It involves a 2-year program of mentoring and networking to support the entrepreneurship landscape free of charge. In its first phase, the program will help 45 startups develop their business plans. 15 finalists will travel to London to develop their products or services and implement their internationalization plans by operating from the London Tech scene. The program will also offer regular business and tech-specific trainings and classes for free to interested companies. A national electronic stock market scheduled for end-2015 and operated by the private sector will complement this initiative and create a window to external markets for startup owners looking for an exit.

Cairo Blasts off for the First time with nAsA space Apps Challenge

Flat6Labs Launches Beirut Accelerator in Partnership with Arabnet

AltCity Bootcamp Aims to Graduate 100 startups every year

Cairo hosted the first local edition of the NASA-led international Space Apps challenge, a two-day hackathon to design open-source solutions that benefit space exploration missions. The People’s Choice award went to “Cubesat”, a solar-powered device linked to a host spacecraft that captures photos of its parts or surrounding space. Second place went to the “Super-Copter”, able to fly in both zero-gravity space and in earth’s atmosphere to serve as a paramedic or assistant to astronauts. And first place was won by Bubulshot, an interactive mobile app that can help farmers detect crop diseases from space, via image processing technology. It provides information about the infection and its treatment, warns nearby farmers to take precautions, and supplies researchers with data on the spreading of the infection.

ArabNet has partnered with Flat6Labs to launch a new seed fund that will run the accelerator’s seed and early investments in Beirut. Lebanon will be the location of Flat6Labs’ 4th startup accelerator, following a string of successful expansions in the region. ArabNet will help Flat6Labs establish the new accelerator in Beirut, as well as offer assistance in fundraising and setting up. The launch of an accelerator is a continuation of ArabNet’s strategy to support entrepreneurs. According to Ramez Mohamed, Flat6Labs CEO, “Over the span of the coming 5 years, Flat6Labs Beirut will support, nurture and invest in over 100 budding highquality companies to help them validate their products, find the best market fit, and prepare them for the future rounds of funding to scale globally.”

Beirut’s startup co-working space AltCity wants to accelerate 100 startups per year by taking them from the idea stage to investment with its new startup development program, Bootcamp. The first round of Bootcamp will take place between May and June 2015, and will welcome startups in their pre-product or pre-corporate phase. The 3-month program comprises a capacity-building period with ideation sessions, workshops and events, followed by an intensive training period. AltCity claims the program is sector-agnostic, although it openly states its preference for tech or digital startups. In the last stage of Bootcamp, startups will be introduced to potential investors among local banks, so as to benefit from the Lebanese Central Bank’s $400M equity funding targeting tech startups.

The QuarTerly Summer 2015

TECHNOLOGY

UsefUl Apps for TrAnsporTATion

A Round-Up of Taxi-Booking Apps for Residents in MENA Cloud as an EnablEr of EntErprisE innovation and Growth By Anthony Butler | @abutler

loud has made it easier for entrepreneurs to innovate digitally; armed with a credit card and an idea, they can rent resources and can source even very advanced capabilities – such as cognitive computing – from the same cloud. By removing barriers to entry, cloud has enabled a Cambrian Explosion of startups. We can see this in our own region where there are emergent startup ecosystems appearing in many cities,

The QuarTerly Summer 2015

enabled—in large part—by cloud. Whilst benefiting startups, these shifts simultaneously pose a threat and opportunity to enterprises. New entrants are disrupting incumbents and taking shares from existing market players by delivering services and experiences on users’ own terms, and they are leveraging new technologies, delivered from the cloud, to do this. However, enterprises can also take advantage of the same

technologies to disrupt, innovate, and take shares from their competitors. Cloud has made innovation the basis on which companies of all sizes now compete. The banking industry is one of several industries that have found themselves assailed by new entrants offering innovative approaches to services, such as payments or lending. Much of this has happened by taking the bank’s services and unbundling them into “apps.” As

Heather Cox, Chief Marketing Officer at Citi, noted at IBM’s Interconnect conference this year, people need banking but they don’t necessarily need banks. This same pattern is replicated across industries. For example, whereas people need telecommunication services, they don’t necessarily need telcos. And as Uber is demonstrating globally, we may need transportation services but do we really need taxi companies? Rather than face death by a thousand digital cuts, enterprises have an opportunity to transform. It is a fallacy to assume that enterprises are destined to always be disadvantaged when competing with nimble startups that are unencumbered by organizational complexity and technical debt. On the contrary, enterprises have tremendous amounts of data, applications, and services that, although hidden behind the firewall, represent untapped opportunity. They should look to unlock this value and, leveraging mobile, analytics, and cloud, deliver it to end users in a way that is engaging. By doing so, they can capture new markets and maintain their foothold in existing ones. They must focus singularly on delivering value and experiences on their users’ terms; they must focus only on what delivers differentiation. With much of this value delivered via apps, developers play a fundamental role in how enterprises transform and address these new opportunities. Just as they need to unleash their data and applications, enterprises must unleash the innovative power of their technical community. This means giving developers more technical freedom; something that can be anathema to the culture in many corporate IT environments but critical if enterprises want to compete in this new world. It also means recognizing that if an enterprise just looks to the developers sitting behind their own walls, they are missing out; instead, enterprises need to look at how they can marshal the creative energies and talents of external developer communities. This is especially true in the Middle East where we see youthful tech savvy populations developing nascent startup ecosystems in cities such as Riyadh, Cairo, Amman, and Beirut. Enterprises can do this by making

their data, applications, and services available to the public as APIs and running initiatives to promote use of these APIs to create new apps or incorporate into existing ones. For example, Citi is working with IBM to run a global competition, called Citi Mobile Challenge, in which external developers compete to develop the most innovative apps, leveraging Citi, IBM, and third party APIs. The best apps selected will move to production. NASA is taking a similar approach with the Virtual Space App Challenge, which aims to create apps that contribute to space exploration. Think of it as crowdsourcing innovation. To do this, we believe enterprises

need a platform for digital innovation. This platform, delivered from the cloud (Platform as a Service or PaaS) provides an environment wherein the developer can just focus on the code and the data, with everything else, such as runtimes, databases, and supporting services, provided by the cloud. Focus on what differentiates and rent the rest. Speed is critical: digital competitiveness is now a function of how fast someone can deploy code, measure results, learn from the market, and factor into the next deployment. PaaS allows enterprises to accelerate to the point where new apps can be deployed in seconds. This makes it possible to deliver new functionality – to address new market opportunities – more rapidly than in the world of traditional IT where release cycles can take weeks or months.

“Cloud has made innovation the basis on which companies of all sizes now compete.”

Anthony Butler is the CTO of IBM Cloud in Middle East and Africa; responsible for technical leadership across IBM’s cloud services and software portfolio. He is focused on helping clients create new sources of value using cloud technologies; and enabling their digital transformation. Anthony previously held several regional and global technical leadership roles; and has led IT transformations for some of IBM’s largest clients. He has patent filings in the fields of next-generation cloud, mobile and security technologies; and holds a Masters of Engineering from the Royal Melbourne Institute of Technology. He lives in the United Arab Emirates. He can be contacted at butler@ae.ibm.com or on Twitter at @abutler.

In conclusion, the right PaaS gives enterprises the opportunity to start thinking and acting like startups – at startup speed. It can help them innovate to address new opportunities and new markets and deliver new value in new ways. Developers can rapidly test ideas, deploy code, and get feedback to evolve. It can be game changing. The benefits become more profound when the platform is extended to external developers; now, instead of fearing the lone developer sitting in a cafe, enterprises have the opportunity to marshal this same creativity. The next disruptive app may still be born on this developer’s laptop. But, by providing this developer with APIs, a platform, and an incentive, the enterprise can shift from being a passive victim of these disruptive forces to being a major beneficiary of them.

Summer 2015 The QuarTerly

TECHNOLOGY

UsefUl Apps for TrAnsporTATion

six A Round-Up Criticaloffactors Taxi-Booking forApps Enterprises for Residentsto in leverage MENA paas 1. Select a platform that offers choice to developers and choice of deployment model

In order for developers to innovate, they need the freedom of choice. Some workloads can run in a PaaS runtime but others may need to run in a virtual machine or a Docker container. Maybe Java is the optimum language for one app or one function, but maybe Ruby, Go or Node is optimum for another. Maybe they want to create microservices. Maybe they want to use NoSQL as the data store for one service, but use a relational database for another. The platform should also provide choice of deployment model. Some enterprises will be comfortable using a public PaaS; others will want a dedicated PaaS; and, yet others will want all the benefits of the public PaaS but deployed securely in their own data centers. Others may want a combination of all three models.

2. Ensure the platform supports open standards

The platform should be based on open standards, such as Open Stack and Cloud Foundry. It should not lock the enterprise in to a proprietary platform but instead allow them to retain ownership and control of the assets they develop in the platform. At the same time, enterprises need enterprise-grade support for this open platform.

3. Choose a platform that enables hybrid apps

The tremendous value locked away in enterprise systems can’t always be moved to the cloud; maybe due to it being a regulated domain, such as telco or public sectors; or maybe because it sits in an ERP or CRM system that shouldn’t move. Therefore, the PaaS should provide the capability to securely integrate these services, data, and apps with the apps that are deployed in the cloud. Just as we have hybrid clouds, enterprises need to create hybrid apps.

4. Consider enterprise-grade security

Security is important to enterprises. As such, they should select a PaaS provider that ensures enterprise-grade security whilst also providing services and tools to ensure that the developer can factor security into their application development.

5. Ensure the platform comes with rich API and service catalogue to accelerate time to value The PaaS should provide a rich catalogue of APIs and services. This allows developers to quickly and easily stich these functions into their applications. For example, in the case of IBM’s digital innovation platform (called IBM Bluemix), we provide services as diverse as Watson cognitive computing, Twitter data, tools for sentiment analysis, and mobile quality analytics. This allows the developer to focus on what is important and accelerates time to market, and it allows developers to access very advanced capabilities that might otherwise not be available to them in their environments. In addition, the PaaS should allow the enterprise to securely publish their own APIs into the platform so that their internal and external developer communities can use these APIs to access their existing services exposed from the enterprises’ on-premises systems. By doing so, the enterprise can even participate (and benefit from) the startup ecosystem by effectively using the API as a channel to sell services and data for inclusion in the startups’ own apps.

6. Select a platform that provides flexible pricing

The selected platform should offer a pay as you grow option. It should be based on consumption and, given the focus on experimentation, should offer free tiering so that a decision can be made to commit to pay only when or if value is proven.n

The QuarTerly Summer 2015

THE MENA: AN EXCITING PLACE TO BUILD GAMES

Does the Gaming Industry Have What It Takes to Level Up? By Mary-Margaret Walker | @mmwalker

rowth in the games industry has always excited me but never so much as it did when I was in Beirut for MENA Games 2015 and in Dubai for Step 2015. Both events did a great job of bringing international attention to the fast paced growth of game development in the region. Still, in a region whose games industry needs more schools, investors, accelerators, mentors, and local experts, it can be challenging for developers to make a breakthrough, but it is certainly possible. As a career advisor with a special focus on the gaming industry, my particular approach with individuals

and companies involves making them more aware of the opportunities to learn and, more importantly, of their personal responsibility to grow. While waiting for the right combination of stakeholders to fall in place, developers in the MENA can focus on the home front and make sure they have what it takes to start building up their exposure externally. The global game industry was still tiny when I joined it in 1992, but it wasnâ&#x20AC;&#x2122;t new. Iâ&#x20AC;&#x2122;ve seen the majority of its growth from inside a couple of great companies (including Origin Systems and 3DO) and 6 amazing cities in the USA and Europe. Every one of these places started out

without any of the infrastructure that is present today. Exposure: Getting the Facts Right Exposure for your company mainly involves external business development, marketing (traditional or guerrilla), and leveraging social media presence for promotion or crowdfunding. These are the pieces you need to build your business externally through clients, customers, investment, or other creative means. 1. Focus on external business development The higher the profile of the MENA

Summer 2015 The QuarTerly

TECHNOLOGY

UsefUl Apps for TrAnsporTATion

tweak your output for better performance.

region’s gaming industry, the more investors will be interested in game development there. Whether to work with investors or not has been an ongoing discussion in the tech and games field, but it is still a decision that all developers have to make on their own. Every company must also be ready to build without external investment if they are serious about their goals. A winning business development strategy involves creating a business plan and sharing your message externally. One tactic you can use to increase your revenue sources is by promoting and selling (or licensing) tools, software, or intellectual property that your company develops.

Practical examples of guerrilla A Round-Up of Taxi-Booking Apps for Residents in MENA

2. Traditional marketing: are you there yet? Creating a market for a company’s services through the use of traditional marketing sources (print, TV, web banners) is not very popular among smaller companies and in less developed markets, due to budget and size constrictions. Notable exceptions include the Scottish Games Alliance in the UK, a coalition of Scotland-based games developers who founded their own promotional group. This group eventually morphed into a much larger media initiative, Scottish Development International, that still supports the gaming sector, as well as digital and trade enterprises. Another example is the Nordic Game Community that shares news about the industry and provides support to game developers. Established in 2004 with €12M (around $1.5M at the time) from Nordic governments, the community offers grants programs and funding support platforms for developers. In any case, traditional marketing for gaming companies almost always involves an internal marketing expert or a consultant. Its tactics include: attending, sponsoring or buying booth space at an event; advertising in print magazines, billboards, buildings or online directed to your target audience; and sponsoring industry organizations. Once you have sufficient revenues, you might consider more traditional marketing channels. For example, developers of massively multiplayer online role-playing games (MMORPGs)

The QuarTerly Summer 2015

Mary-Margaret Walker is a gaming career consultant and a regular speaker at universities, as well as at different events and conferences for the gaming industry. She is an expert in career development and building companies using soft skills, social media and technology tools where digital entertainment meets high tech and social change. In 1996 she started the Mary-Margaret Network that has worked with companies around the world, most notably Electronic Arts, Disney, Microsoft, Sony, Indiagames and Activision. Walker is also a charter member of the International Game Developer’s Association as well as Women in Games International. such as Supercell (Clash of Clans) and InnoGames (Forge of Empires) can afford to produce and place TV advertisements on TV and satellite channels. 3. Get creative with guerrilla marketing This is a more common choice for small businesses with restricted budgets and a lot of imagination. It is just as important here to have someone with a marketing background or a great flair for marketing success leading the initiatives. For the best results, you should still formulate a plan regarding the message that is being delivered and the best locations and formats for delivery. It is also necessary to understand analytics and know how to

marketing include using YouTube or a website to post a video trailer. Surgeon Simulator 2013 (developed by Bossa studios), for example, has a game play that lends itself well to the creation of viral videos (hilarious surgery mishaps due to complicated controls). These videos are shared massively and help attract new players. Some developers propose a demo of their game and call on Beta testers to sample it. There is a strong chance that these testers will then become ambassadors of the game in their respective gaming communities. Before it launched its new racing game, Nitro Nation, game developer Creative Mobile gave only 1,000 users access to its beta version. These users started bragging about it on social media and created a hype around the “exclusive” nature of the game. Contests are also a good tactic; they can involve any aspect of the game, from naming a character in the game (with company approval) to designing clothing, fan art or signed posters. Giveaways are always popular. They can be promotional goods as well as less “tangible” things such as extra game content that either won’t be for sale in the game or will be for sale as a purchasable add-on. 4. Understand social media before using it Social media campaigns are important to heighten awareness of the company or the product and grow a fan base. Successful social media requires an understanding of marketing as well as of the tools that are used to build, connect, and analyze your network. The necessary ingredients should involve one or more of the following: an aptitude for marketing and a lot of research; an experienced marketing or community manager; and/or an external consultant or service that must still be overseen by someone sophisticated enough to understand the process. Evaluating your social media strategy involves different elements that are unique to each company and project. Very simply, it means determining which social media platforms are most important to

Community Building Tool

Benefits

Co-hosted events/ workshops

Publicity, networking, knowledge sharing, attracting and recapturing local talent

Online seminars

In-depth discussions, greater interest in the region, collaboration with academic institutions

Presentations by guest experts

Knowledge acquisition, networking, creating an academic framework (by collaborating with universities)

Industry websites, groups, forums

Visibility, networking, knowledge sharing, discussions

you and finding out the best ways to utilize them to reach your audience. In all my research, I have found several articles that offer valuable insights for creating your own social strategy plan including, your goals, the best tools to use, and a simple to-follow plan. One article I recommend in particular is How I Manage a Social Media Platform of Over 11 Million Followers Every Day, by author and keynote speaker Peg Fitzpatrick. 5. Should you crowdfund? The popularity of crowdfunding platforms makes them an attractive option for many hopeful young developers. However, it is not something you can launch without a well-structured marketing plan. Your crowdfunding campaign has a higher probability of failure if you don’t have a marketing strategy in place well before you launch your campaign. You have to put some time into crafting your story and convincing people that your game deserves support. Talking about your game or showing off its graphics isn’t enough to land funding, potential players, or individuals who will continue to pay; you need a thorough understanding of the user experience. Harebrained

Schemes is an impressive example of a game studio with a 100% success rate for 3 games it crowdfunded on Kickstarter. For its second game, Shadowrun Returns, the developer had promised to include an in-game cityscape chosen by backers. In the end, Berlin won the nomination but beat Hong Kong by a slight margin. This led to the third game set in Hong Kong (Shadowrun: Hong Kong) that was overwhelmingly funded (totalling $1.2M out of a targeted $100,000). Additionally, the cityscape was designed with the help of Hong Kong natives and expats among the game’s fan base. Build a Community to Build Out Based on my experience, I have found that community building is the most critical growth area for each company and for a whole region - it can also be extremely rewarding. The best way to build out a gaming infrastructure is to create unity, partnerships and programs. By coming together to create an inclusive organization you will increase your own and the gaming sector’s overall power and presence in many areas. You will also gain a greater understanding of what it takes to create, import and hold on to seasoned talent.

1. Pool your resources Combining your resources, such as the Scottish Games Alliance and many other groups before have done, will allow you to have a presence at larger global events. It increases networking opportunities and access to learning (special seminars and workshops) that can be shared later. This generates greater visibility locally and internationally, which can attract investors, talent, experts, academics and, above all, local financial support. Recapturing local talent that has moved out of the area by merely showing them what they are missing. 2. Hold online seminars This allows you to bring experts and local developers together and share best practices without the added expense of travel. Such seminars can address subjects in more depth than regular conferences by opening the way to online discussions. Involving experts from the US or Europe and publicizing such events will create a greater interest in the region’s gaming industry and a stronger desire to get involved. If such events are appropriate for universities or high schools, they could also be an ideal way to gather feedback and lobby to include industry courses and/or trainings in academic curricula. 3. Invite experts to your region Apart from the obvious benefits of acquiring knowledge first-hand, hosting experts for events in your country creates more publicity and networking opportunities. Partnering or collaborating with universities on that subject could also bring the industry one step closer to creating an academic support framework. 4. Create a MENA-centric gaming website: A current website and/or social media presence that represents the area as a whole is an inestimable asset in terms of visibility (locally and internationally). It also serves to increase networking opportunities. These channels should also include a login side for internal collaboration and blogging to discuss ideas, techniques, tools and anything else that you want to share.n

Summer 2015 The QuarTerly

We Ask the Developers

What Is Your Advice for Creating Great Mobile Apps?

By Nour Nasser Al Dean | @nournad13

Rami Tabbara Born Interactive, Lebanon

Masood Sofi United Arab Emirates

One thing every mobile app developer should do is plan, then plan, then plan. Working on a mobile app can easily lead to a messed-up code. Developers must allocate enough time for planing before writing any code so that they can create reusable code, avoid code duplication, use proper naming and class files organization, and produce a well-thought UX for the user. This makes it much easier to maintain and extend the project. Also, as part of this planing, developers must acknowledge that mobile devices have some limitations; they need to identify what sections of their app is expected to grow in terms of data, and plan beforehand on how to handle them before they actually grow. This can be accomplished by separating the data into pages or using lazy load to avoid memory leaks that causes the app to crash.

Make the user experience as simple as possible by breaking down a complex functionality into simple user actions. Not calling third party APIS directly from the app is also something I stress on as this reduces dependency on the vendor. Maintaining an authorization interceptors when developing for enterprise services is a must to avoid security issues.

The QuarTerly Summer 2015

Bashir Osman TechGeek365.com, Qatar

Krystel Chaccour Syncworx, Lebanon

As a computer software engineer, I’ve had my fair share of ups and downs on the developer roller coaster. Some people think of developers as creatures that input coffee and output code. The main point that has helped me succeed when it comes to web and mobile development is having a crystal clear communication with customers. Fully understanding what kind of application you’re building and why you’re building it is absolutely crucial if you want to stay on top of your game. Another key point is organization and management. I like to break down my large projects into smaller tasks, giving me laser focus on each task and allowing me to generate better results overall. One final piece of advice would have to be: always under promise and over deliver. People always love receiving an end result beyond their expectations.

Simplicity! Your app should be as simple and as straightforward as possible. The foundation of any successful digital platform is a well-established User Experience and User Interface, therefore UI/UX should come first. What matters most to users is reaching their goal with minimum action possible. At the end, people are using it for a specific purpose, so your job is to make reaching that purpose easier. Keep in mind that you’re developing for a very wide range of users; hence, understanding your target audience is key to creating a successful application. In brief, a simple, planned, and tested UX will help any app stand out.

Summer 2015 The QuarTerly

Mehdi Mariouch

Ali Akrakbi Morocco

Rami Adada JadeMonroe, Lebanon

Forget about native or not; forget about tools and computers. The best way to start is by drawing your prototype. And go talk and pitch to your customers. They are the ones who should tell you what they want. Then you can start coding. After the first development, go back to your customers and check again. Do it as many times as you need. On a side note: do not listen to people requesting for features and featured - it’s a trap.

When building a mobile app, it’s important to focus on the right things. The best way to uncover those right things is by building a MVP version of the app to test the market (this assumes you already have a solid idea of what you want). Build the MVP using React Native (don’t bother with anything else). React Native will give you a very clean and elegant iOS build, while also allowing you to iterate on changes very quickly (a requirement for successful MVPs). If the MVP succeeds and you’re ready to move onto the next step, build a native version of the app on iOS. Don’t even think about Android (yet). And avoid the temptation to build a hybrid version of the app. It will fall very short of expectations and will cause more problems than it can solve. Make this a strict requirement.

Oday Maleh Lebanon

Mohammad Almarzouq Kuwait

The fact that mobile devices are available to everybody nowadays will sometimes give you or the people you work with a false sense of entitlement when taking decisions about what the UI/UX of a mobile application should look or behave like. As much as you’d like to think that you are capable and competent enough to come up with design decisions, you will not be able to perform anywhere near as well as a professional designer who has studied the science of UI/UX and takes decisions based on knowledge, not personal preference or ease of implementation. You are a programmer, not a designer.

Do not let your fear of programming or educational background hold you back. If someone with a marketing background can build and sell Instagram for $2B, then so can you. Start with a language that is versatile and easy to learn like Python or Javascript to help you understand the basics. Then work your way up to languages that were built for specific platforms and require an understanding of a framework like Swift for iOS or Java for Android. Think of a project that you really want to succeed, and learn to build it. This urge to succeed is your best motivator to go through the frustrations of learning something new like programming. It will be very frustrating, and at times, depressing. You will frequently feel stuck, but there will come a time where things start to fall in place.

The QuarTerly March 2015

BUSINESS

UsefUl MENA Apps SMArt for TrAnsporTATion ENtErpriSES

ANd CitiES drivE digitAl iNNovAtioN

A Round-Up of Taxi-Booking Apps for Residents in MENA

Deloitteâ&#x20AC;&#x2122;s Technology, Media, & Telecommunications Predictions for 2015 By Alexis Baghdadi | @GuerrillaWriter

The QuarTerly Summer 2015

he MENA, particularly the GCC, is an ideal landscape for tech and digital innovations, backed by a strong ecosystem of enterprises, smart cities and mobile government initiatives particularly. According to Deloitte’s Technology, Media & telecommunications Predictions for 2015, these will be the main engines behind the development of ICT and telecommunications in terms of scale, usage and scope. GCC countries aim to surpass more advanced economies by launching mass government-led IT transformation programs including smart cities, contactless payments, etc. Media consumption will also increase with growing smartphone penetration in the MENA. Mobile government and mobile payments will also improve to adapt to this new customer base. Here are the main trends and innovations to look out for in 2015:

ICT’s Eldorado: MENA Enterprises and Smart Cities

installed IoT base to around 70 million devices (such as smart TVs, game consoles and set top boxes). This will be worth around $250M in IoT-specific hardware, with revenues of around $1.7B in associated IoT services. Beyond 2015, Deloitte expects the region to accelerate at high speed in its adoption of IoT devices and deployment of associated services. GCC countries in particular have big plans: smart telecoms, smart industries, smart government and smart cities all running on smart infrastructure. The vast majority of IoT devices and services will most likely be shipped and deployed across these more technology-ready countries, with demand driven by telecom operators, enterprises and governments pursuing smart developments across key industry verticals. 2. Enterprises will be early adopters of 3D printing Deloitte expects nearly 220,000 3D printers to be sold worldwide in 2015 (worth $1.6B). Most units will be sold to consumers but enterprises will account for 90% of the value of all 3D printers, over 95% of all printed objects by volume, and 99% by economic value. The MENA represents a small fraction of this market with its limited design and manufacturing landscape. Deloitte predicts it will record an annual increase of almost 60% in 3D printer units and 30% in 3D printing revenues until 2017. Interesting applications are more likely to be observed in enterprises that can afford more advanced and versatile models. Conferences like the upcoming 3D Print Show in Dubai, together with adoption in universities (the American University in Sharjah, the Texas A&M University in Qatar, etc.) reflect the market’s interest in 3D printing and contribute to a better understanding of this technology. Top 3D Printing Applications Globally

The GCC is witnessing a large number of events and deals that are shaping the future of tech industries. Partnerships between governments, telecom operators and technology leaders are paving the way for locally-induced innovation. Saudi Arabia, the UAE and Qatar are spearheading the development of big data at a national level. In parallel, large enterprises are also enhancing their IT systems and infrastructure to improve operations and prepare for the future requirements of the global workplace. IoT devices and 3D printers are two of the most promising expected innovations. Other examples include drones – though enterprises will only deploy them on a limited scale – and nanosatellites or “nanosats” (miniature satellites weighing between 1 kg and 10 kg only) whose number will triple to 500 in 2015. 1. The MENA IoT market growth outpaces global rates The MENA’s annual growth in hardware and connectivity currently reaches 20%-30% (compared to 10%-20% globally), and growth in associated services reaches around 50%-60% (versus 40%-50% globally). 25 million IoT devices will be shipped to the MENA (mostly to GCC countries) in 2015, bringing the

Aerospace: 3D printing is ideal for highly complex parts, especially where manufacturing capacity is limited (aboard space shuttles or stations) Automobile: The auto industry is the single largest buyer of 3D printers (over 40% share) but over 90% of them are used for prototyping of non-functional parts Medicine: The medical vertical is often discussed as one of the bigger markets for 3D finished part manufacturing (about 15% share) Education: Learning how to use 3D printers will be enormously useful for those who will end up using them in their jobs, and a positive learning experience overall 3. Smart cities will be the home of ICT Smart city growth is expected as new cities seek to adopt pretested solutions. Much of the expansion will occur in North American and advanced East Asian cities, followed by cities in the GCC. 6 entirely new, master-planned smart city developments were launched in the GCC over the past decade. Monitor Deloitte predicts this number will double in the next 2-3 years. The majority of new city sub-developments is also expected to incorporate at least some element of “smart” infrastructure.

Summer 2015 The QuarTerly

BUSINESS

UsefUl Apps for TrAnsporTATion GCC Smart City Greenfield Developments

The Road to Open Data – Checklist

Dubai Design District (UAE)

• Create more regulation (security, privacy, data

A Round-Up of Taxi-Booking Apps for Residents in MENA A district dedicated to design and the creative industries, incorporating smart infrastructure Information Technology Communications Complex, Riyadh (KSA) Offering world-leading ITC services and infrastructure, attracting international ITC companies and making Riyadh a hub for ITC services, education, research and innovation King Abdullah Economic City, Jeddah (KSA) New city 1 hour north of Jeddah incorporating the King Abdullah Port, designed on social, economic, and environmental sustainability principles Lusail City, Doha (Qatar) High-technology urban environment comprising both wired and wireless communication networks, and operation control center that will manage the information technology network covering the whole city

mining, data ownership)

• Guarantee more specific infrastructure requirements and standardization policies

• Carry forward the momentum of e-government to open data advances

• Collaborate with and learn from leading open data governments such as the UK

• Engage with the private sector and civil society • Build communities through soliciting citizen participation and feedback

Media Consumption Will Thrive on the Islamic Economy and Millennials

Masdar City, Abu Dhabi (UAE) Master-planned city development relying only on solar and other renewable energy sources to power the city Silicon Park, Dubai Silicon Oasis (UAE) A complete smart city project incorporating smart energy, mobility, and lifestyle solutions

4. Open data will be essential to e-government growth Numerous studies show e-government is the gateway to economic growth, progress and social stability. For over 10 years, the GCC has been digitizing government services and information to be made available online, thus climbing the UN’s world e-government rankings. With its e-government development index growing at twice the rate of the global average, in 2015, the GCC may even overtake Europe as the leading region. Open data accessibility and relevance is key to launching initiatives by individuals, enterprises and governments. It allows the analysis of patterns and trends to facilitate solution creation for both day-to-day and more complex problems. 2015 will represent an open data milestone for several MENA countries. GCC states that still lack open data initiatives will begin to outline them, while the others will initiate implementation. Within the next 3-5 years, GCC countries will break into the top half of countries ranked the most “open” in the world.

The QuarTerly Summer 2015

Deloitte predicts that 2015 will be the year that digital Islamic services start to take off across the MENA and the world. Digital services like social media and mobile gaming have already been adopted massively and have resulted in the multiplication of digital Islamic services (Islamic lifestyle websites, blogs and app solutions). 1. The Islamic economy’s growth is spilling over in the digital domain The region’s digital economy is expected to grow rapidly (albeit from a low base) thanks to the Muslim consumer base’s size, purchasing power and technology readiness. The size of the region’s digital Islamic economy will nearly double in terms of lifestyle products and services spending, from around $15B currently to possibly over $30B by 2018. In this context, Dubai’s stated ambition is to become the capital of the global Islamic economy.

With 30 million online buyers, e-commerce still represents only 2% of the offline retail market (including travel), but is expected to grow by over 21% annually, outpacing international rates. Spending on digital Islamic services, driven by high digital media consumption, will grow by 25%-30% across most areas of the Islamic economy in 2015. Digital Islamic Economy Performance by Sectors Sector

Performance in 2013 Prediction for 2017

Islamic Media

$10B total spending

$23B total spending

Halal Travel

$2B in revenues (1/5 of total e-commerce revenue)

$4B in revenues (double)

Modest Fashion

approximately $0.6B total spending

$1.4B total spending

Halal Food

$368M total spending

$840M total spending

Other sectors

$246M total spending ($241M on Pharma & Cosmetics, $3.4M on Islamic Economy Education, $0.7M on Islamic Art & Design

$562M total spending ($552M on Pharma & Cosmetics, $7.8M on Islamic Economy Education, $1.6M on Islamic Art & Design)

2. Arab millennials’ media spending remains steady High rates of smartphone adoption, broadband, technological advancements and increasing literacy rates play a key role in the growth of media consumption in the MENA in 2015. Smartphones are the second largest platform for media consumption after television, with 25% of smartphone owners across the UAE, Saudi Arabia, Lebanon and Egypt consuming media content through their smartphones daily. Deloitte predicts that millennials (18-34 year olds) in the MENA will spend up to $37B on media content in 2015 (approximately $300 per millennial) mostly around 3 core segments: pay-tv, music and mobile gaming. However, media spending by millennials is low in comparison to more developed markets such as North America, due to unemployment, widespread FTA channels and free music downloads, and a lack of exclusive local content (especially in sports).

1. 70-100 million smartphone upgrades in the MENA The MENA has a smartphone penetration rate of 20%-30% that holds significant potential yet. It is expected to reach 39% by 2016, with sales totaling around 110-140 million units. Growth drivers include a rise in “second screen” media consumption, social media uptake and mobile payments. Deloitte predicts there will be 70-100 million upgrades in the MENA in 2015, generating around $18B-$28B in revenues. The upgrades market is the foremost contributor of overall smartphone sales in the region, led by GCC countries that have the highest penetration levels (70% average). The upgrade cycle of GCC consumers could be as short as 6-8 months (compared to 12 months globally). 2. Mobile government will precede e-government Deloitte predicts there will be over 500 mobile government apps across the MENA by 2016. The region alone already represented 24% of the global services base in 2014. The GCC is leading growth with e-government and mobile government initiatives. The UAE, Saudi Arabia, Qatar and Bahrain are particularly active in that domain. Success has been most visible in the UAE, where the Dubai government reported in early to mid-2014 that around 38 percent of its services were being accessed via online channels. Most of this conversion is likely to be via mobile (rather than web-based), according to a national survey. 3. Contactless payments finally make headway globally Deloitte expects that 2015 will be an inflection point for the usage of mobile phones for NFC-enabled in-store payments. This will be the first year in which the multiple prerequisites for mainstream adoption are sufficiently addressed: satisfying financial institutions, merchants, consumers, technology vendors and carriers. By end-2015, the largest card issuers in the majority of the largest developed countries will have activated NFC smartphone payment. Around 30 million NFC-equipped phones will have been used at least once a month for contactless in-store payments at retail outlets (out of a projected base of 600-650 million devices). Contactless mobile payment will not be mainstream, but adoption will have increased from less than 0.5% in prior years. Like the rest of the world, the MENA is expected to follow this trend and work towards implementing the required regulatory framework. This would encourage more retailers to offer online platforms and make use of the expected growing user base.n

Telecommunications Will Drive the Most Significant Change

As consumers’ preferred communication medium, smartphones continue to grow in popularity. As a result, evolved consumer behaviors are imposing changes in government and payment services.

Summer 2015 The QuarTerly

BUSINESS

UsefUl Apps for TrAnsporTATion A Round-Up of Taxi-Booking Apps for Residents in MENA

merging financial technology (Fintech) startups have been effectively disrupting the financial sector over the past 2 years, whether this was their original intention or not. And this is just the beginning. Until recently, the number of significant innovations and, more importantly, their adoption speed were still limited. Now the situation is evolving as startups are emerging in various subsectors of the Fintech space: Peer-to-peer lending, crowdfunding, mobile payment, electronic billing and presentment, insurance, price comparison, crypto-currencies, etc.

The QuarTerly Summer 2015

Investors are starting to pay serious attention to the new kids on the block. In 2014, global investment in Fintech startups tripled to $12.21B (up from $4.05B in 2013), according to a report by Accenture. Lending Club, a US-based peer-to-peer (P2P) lending platform, became last yearâ&#x20AC;&#x2122;s biggest US tech IPO, raising $865M on the New York Stock Exchange, and now valued at $8.5B. Governments are also joining in. London has been at the forefront of the Fintech revolution and has surpassed New York and Silicon Valley in terms of Fintech job creation.

Changing the Way We Bank

Fintech startups rapidly identified opportunities in the banking sector (inadequate speed and transparency, poor UX, high costs) and moved in. Their arrival coincided with the right market conditions after the dot-com bubble exploded. They benefited from a positive ecosystem that makes it easy for anyone to start a company, as well as a sizeable pool of talent to tap into. â&#x20AC;&#x153;With the current much lower costs of technology development and deployment, there is a clear opportunity for smaller companies to participate in the industry in all areas of the business:

“Some banks are ignoring or downplaying the potential disruption while others are embracing change.” Omar J. Sati – Managing Director at DASH Ventures

lending, saving, investing, advising, planning, providing insurance, managing risk, etc.” said David Martinez de Lecea, co-founder of the investment platform InvOrOut. The rapid adoption rate of new technologies also played in their favor. From payment systems to lending and investment platforms, Fintech startups have started appropriating different B2B and B2C services traditionally associated with banks only. Like their predecessors a few years back (Intuit, Paypal, Mint.com) their success is based on their capacity to innovate and develop products or services that enhance, simplify, and

personalize the banking experience.

Disrupting Payment Systems

Payment systems are adapting to changing consumer behaviors as mobile and smartphone (and, more recently, wearables) penetration rates increase. Globally, there is a growing number of startups that propose mobile payment and e-wallet solutions. Examples include Square (valued at around $6B) and Zong. Square is a dongle device that turns smartphones into credit card readers, allowing small merchants to easily collect payments from cardholders. Zong is a

carrier billing solution where customers share their phone number with a merchant and the charge appears on their mobile bill. At the same time, the world’s largest tech companies – including Google, Apple, PayPal, and Facebook - are competing to be the online and mobile payment and wallet solutions of the future. PayPal, for instance, acquired 2 major players: the UK-based Braintree platform for web and mobile payments, and the Card.io application that uses merchants’ mobile phone cameras to authenticate credit cards and process payments without any typing involved. Before it was acquired by PayPal, Braintree had recorded an annual payment volume of around $22.8B in 2014 (more than double its volume in 2013). In the MENA, investments in similar Fintech startups show that the region is following the global trend. As early as 2010, Middle East Venture Partners (MEVP) had invested $1.1M in PinPay, a mobile payment and bill aggregation platform. It also invested $700,000 in the payment aggregator Gate2Play. Last December, the mobile commerce and rewards platform Beam Wallet had received an undisclosed “landmark” investment from Majid Al Futtaim Ventures. The platform was developed and launched in the UAE in 2012 and regroups over 1,100 stores, with more than 100,000 users. Commenting on the investment at the time, Shezan Amiji, co-founder of Beam Wallet, said he was confident that the app would grow to include 5,000 stores and double its number of users by end-2015.

Disrupting SME Financing

Online crowdfunding and P2P lending platforms are making funds more readily available to SMEs and individuals.

Summer 2015 The QuarTerly

BUSINESS

UsefUl Apps for TrAnsporTATion 1. Crowdfunding Crowdfunding platforms help raise funds for individuals, NGOs, and SMEs on donation basis or equity basis. Donationbased models (the most popular of which are Indiegogo and Kickstarter) make financing available to SMEs or individuals almost unconditionally, only charging a small percentage fee of the total funds raised. Additionally, campaign owners may choose to offer perks or rewards to their donors. Indiegogo’s main feature is its flexible funding scheme whereby a campaign will earn any amount it raised, even if it does not reach its total goal. Most platforms, however, offer a fixed “all-or-nothing” financing model like Kickstarter. Based in Lebanon, the donation-based Zoomaal follows the fixed financing model, and has helped successfully fund over 60 projects for a total value exceeding $800,000. Aflamnah, another platform based in Egypt, uses a flexible financing model. This platform focuses on films and creative projects (games, apps, etc.) and has successfully funded projects for a value exceeding $170,000 (excluding partially funded campaigns). Unlike reward-based platforms, equity crowdfunding platforms – like iCrowdFunding (Ireland) or CircleUp and Crowdfunder (US) to name a few – allow SMEs to raise capital in exchange for equity. The UAE-based Eureeca is currently is the only equity crowdfunding platform focusing on the Middle East. In March it announced that it became regulated by the UK’s Financial Conduct Authority (FCA), meaning it became open to both SMEs and investors in the UK and Europe.

said Craig Moore, founder and CEO of

“That meant building something that

put their own principles into practice and actually crowdfunded the launch of their marketplace. “There probably isn’t a better way to show the power of a model than when you’re actually using it to gain funding and grow your own business,” said Moore. liwwa, the first P2P lending platform for SMEs in Jordan, recently closed its seed funding round in March 2015, raising $500,000 from Dash

could participate in.” In one month, liwwa underwrote $110,000 in debt across 10 SMEs. For now, the platform only hosts borrowers from Jordan but it is seeking to extend its service to new markets this summer. These P2P platforms address a funding gap for SMEs in the MENA, where in some countries SMEs represent 60%-65% of the GDP on average (up to 85% in Egypt).

Beehive. Interestingly, founders in MENA anyone, including observant Muslims, A Round-Up of Taxi-Booking Apps for Beehive’s Residents

2. P2P lending P2P lending platforms facilitate access to capital for SMEs and allow investors to make small returns. They also give smaller investors a chance to get better returns and minimize risks by diversifying their investments. Beehive is the UAE’s first online P2P lending marketplace. In its first year, it helped fund 20 businesses (as of end-April 2015) and gathered more than 1,000 registered investors. “We’ve also seen some of our early SME businesses discuss returning for further finance solutions, which is a testament to the model,”

The QuarTerly Summer 2015

___________ The InveSTorS ___________

Walid Hanna, Founder and Managing Partner at Middle East Venture Partners

Omar J. Sati, Managing Director at DASH Ventures

“Serious regulatory changes will have to be implemented before unlocking FinTech’s full potential in the region.” Walid Hanna, MEVP founder and Managing Partner

Ventures, MVI, and Bank el Etihad. It also established precedence by becoming Sharia-compliant. Ahmed Moor, liwwa founder and CEO, said they wanted to serve as wide a range of SMEs as possible:

Disrupting Personal Banking

Most banks worldwide offer at least one form of e-banking (web, mobile, or app) where customers can monitor their accounts and even carry out transactions.

But this still does not eliminate the need for visits to bank branches – unless Fintech startups have something to say about it. Officially launched in October 2014, the Lebanon-based Bnooki is a financial comparison tool covering Lebanese banks’ products (accounts, cards, loans). Customers can purchase banking products directly via the platform, or request assistance with offline processes from the Bnooki team (for a small fee). The aggregator also offers free advisory

in the region soon. Bnooki received an undisclosed investment from MEVP to help scale its operations. In the UAE, Souqalmal initially raised a total of $1.5M from Hummingbird Ventures and private investors. Ambareen Musa, founder and CEO of Souqalmal, said that in less than two years, the business has grown by 300% and site visits have tripled. In addition to financial products comparison, it has expanded to include other verticals such as insurance,

_________ The enTrePreneurS _________

acquisition. BAS had previously raised $881,000 in a series A round from Sigma Gestion, a capital investment firm in France.

Is There More?

For now, Fintech is still a nascent sector in the MENA. Existing services are limited to financial comparisons, payments solutions, crowdfunding, and crowd investing. But a look at global Fintech services reveals just how much potential the sector holds. Possibilities that we can look forward to in personal banking, for example, include savings, budgeting, asset management, etc. In payments there are such areas to explore as bill management, transfers, foreign exchange, and the list goes on. (See page 29).

Is the MENA Ready for Fintech Startups?

David Martinez de Lecea, Co-founder at Finerd and InvOrOut

Ambareen Musa, Founder and CEO at Souqalmal

and follow-up services to customers. “Our goal is to be a facilitator when it comes to business and personal loans, and to make sure customers get the offer best suited for their needs,” said Elie Boujaoude, Bnooki founder and CEO. By handling the application process directly, Bnooki reduces file costs for banks, and is able to charge customers less. Bnooki also plans an insurance platform for Q3 of 2015, where customers will be able to compare and purchase plans online via credit card. Boujaoude said they are considering exporting their model to other countries

schools, telecoms and cars. The site recently launched an SME listing section which has seen a huge uptake from the community (over 300 companies listed to date). Two other aggregators exist in the UAE: Compareit4me and Bayzat, which also focuses on insurance for individuals and groups, as well as car insurance. Compareit4me recently raised $3M in an investment round led by MEVP. The VC firm also invested $530,000 in Box & Automation Solutions (BAS), a provider of cash management and financial control solutions that do not require software

For now, US and European markets probably constitute better environments for hosting Fintech startups, in terms of infrastructure and the legal frameworks. But things in the MENA are changing. “We don’t expect the Fintech scene in Lebanon and the region to be any different in terms of growth and opportunities,” said Walid Hanna, founder and Managing Partner at MEVP. The most Fintech-friendly countries in the MENA region are the UAE, Lebanon, and Jordan, according to Hanna. Dubai is the unchallenged leader from a talent, market adoption, and regulatory perspective. Its technologyreceptiveness makes it the ideal environment for Fintech today, according to most analysts. Just a few months ago, the emirate launched a BitCoin exchange and the first coin ATM. Most of the Fintech startup investment opportunities arising today are coming from there. According to de Lecea, it is only a matter of time before the sector grows in the MENA. For this to happen, the right 3 indicators should be present: 1. Market readiness For de Lecea, the size of the market is bigger than what any startup could even dream to cover in the medium term. “One of the key drivers in Fintech is providing lower prices as compared to traditional financial services providers […] In the

Summer 2015 The QuarTerly

BUSINESS

UsefUl Apps for TrAnsporTATion MENA region, rates are significantly higher than in the Western world hence the monetary opportunity on the margins is much higher,” he said. Investors like Hanna believe that most businesses are open to technology and wouldn’t mind adopting a technology that can reduce their costs, time, and error rates. Omar J. Sati, Managing Director at Dash Ventures, said: “Fintech startups are solving a pain, and I don’t see any adoption hurdles from that perspective as long as standard security and privacy issues are met.” From a sector perspective, Hanna said business-to-business (B2B) solutions such as mobile payment,

found that banks were unfamiliar with

to establish Souqalmal was the presence

more open and started taking a closer interest in these platforms as a way to increase their exposure and generate new leads, while providing better value and service. Musa said the platform leveled the playing field, and allowed smaller players to break through as well. Early adopters saw as much as a 22% increase in customer conversion rates from the platform, according to her. The Lebanese banking sector’s development and competitiveness made it an ideal starting point for a service like Bnooki, according to Boujaoude, and a good

As an expat herself, she was not native to the local banking sector and needed education in that field. This is where Souqalmal came in. Looking at the bigger picture, the site’s Arabic content (in parallel with English) also fills a gap in the region. “Knowing that only 2% of the internet content is in Arabic, there is huge opportunity for Arabic financial education content in the region,” said Musa.

their model. Eventually, banks grew of a large expat population in the UAE. A Round-Up of Taxi-Booking Apps for Residents in MENA

3. Presence of regulatory framework As is often the case in any new market, early innovators normally precede

_________ The enTrePreneurS _________

Craig Moore, Founder and CEO at Beehive

Ahmed Moor, Co-founder and CEO at liwwa

Elie Boujaoude, CEO at Bnooki

payment gateways, etc. are easy to assimilate since they propose a clear added value and the region already has successful players in this space. However, many companies have weak IT infrastructures and still operate many tasks manually. “This makes it harder for a startup to integrate but it will change slowly with time,” said Hanna. The large number of banks in Lebanon made an aggregator like Bnooki a necessity to navigate consumers through the sector and help them choose the best products adapted to their needs. The same reasons drove Musa to start Souqalmal in the UAE. When it comes to the banking sector, both Bnooki and Souqalmal

base from which to expand into the region. By comparison, it took Musa 9 years to convince local banks that financial comparison sites are a great cost-effective channel to reach a more financially educated customer base.

regulation and then work with regulators to help shape a structured and transparent framework for the new sector. “Most jurisdictions have a regulatory framework designed for large financial institutions. In order to speed the development of the Fintech sector the framework needs to adapt to the reality of smaller flexible companies, bringing innovation and acting faster to the changing market needs,” said de Lecea. According to him, the biggest challenge for Fintech startups is, without a doubt, regulation and the costs associated with it. For Sati, some regional markets are more developed than others in terms of regulation, but overall the regulatory framework and financial systems include

The QuarTerly Summer 2015

2. Customer education The growing number of tech-savvy mobile and smartphone users is driving demand in the nascent Fintech sector. PricewaterhouseCooper predicts that these “digital natives” will make up the majority of customers by 2017. Fintech startups also have the opportunity to fill an educational gap when it comes to existing financial sectors. Another reason that drove Musa

strict and rigid lending laws, securities regulations, licensing requirements for brokers and investment advisors, etc. DASH Ventures leverages its industryspecific insight, network, and contacts to lobby for change and lay the groundwork for new regulatory policies. “We help Fintech teams navigate uncertain regulatory waters and legal gray areas so that they focus on creating disruptive technologies and marketplaces that will transform the financial status quo,” he said. In Lebanon and Jordan, central banks’ support give the sector a boost by encouraging investment in startups or partnering with them. In Jordan, the online billing platform Madfoo3atCom won the Central Bank’s tender to build, operate, and administrate the national electronic bill payment service gateway, becoming the official operator for the institution’s e-billing service.

Can MENA Banks Survive the Fintech Revolution?

After talking to different Fintech startups already established in the region, it becomes clear they harbor no belligerent intentions towards banks, nor are they in a position to do so… yet. P2P lending startups, for instance, see themselves as positive disrupters because they fill the funding gap for SMEs (estimated at $260B), a demographic that many banks still neglect, focusing on large corporate clients instead. “liwwa is not a direct competitor for banks, but it could become one in the near future witch changing consumer behaviors,” said Moor. “I don’t

think banks are going anywhere any time soon, but neither are we,” he explained. According to Hanna, it is still too early to speak of banks losing market share. For now, Fintech startups are tackling areas untapped by large financial institutions, or offering complementary services. “Fintech startups are not necessarily attacking banks head-on, but rather the individual products and services of traditional banks, such as bank loans, credit cards, portfolio management, etc.,” said Sati. “Look at the number of traditional banks across the region with archaic systems, the number of financial firms with high fees and limited products. That’s the market opportunity!” he said. As for Hanna, he echoed this opinion, saying things could start to be alarming once cheap transfer solutions and pure online banks begin emerging. Legacy technology and the speed of adopting new technologies are two main factors holding banks back. By comparison, Fintech companies are agile and adaptive. They can be extremely disruptive without being the size of an actual bank. Traditional banks are faced with two possible scenarios: Reimagining banking, or becoming disrupted. They could potentially lose relevance in the face of digital disruption, but the real opportunity for them lies in taking a leading role in developing this market by creating better services adapted to the new realities of business. “It is an opportunity rather than a threat,” said de Lecea. Most Fintech investors and startups agree that the banks who jump

Examples of Services Offered by Global FinTech Startups Startup

Product / Service

Nubank Transferwise

App-managed platinum credit card Credit/loyalty card consolidator with a digital interface Low-cost international transfers and remittances

CurrencyFair, Currency Cloud

P2P direct currency exchange marketplaces with lower spread

LendingHome, Privlo

P2P mortgage lending

Betterment, Wealthfront, Learnvest

Automated investment platforms and consultancy

OpenGamma

Market risk management open source software

Heckyl, Kensho

Financial information providers to companies

Coin

on board early on are the ones who will end up acquiring the largest market share – or, at the very least, remain competitive. Most executives in banks that embrace innovation clearly see the disruptive potential of Fintech, but many are still struggling to decide how to address it. One of the few notable exceptions includes Gulf International Bank (GIB), who entirely redesigned its retail arm by launching the virtual bank meem in July 2014. This web and mobile bank provides a suite of services in Saudi Arabia, including the Currencies Card, a debit card with up to 4 accounts in different currencies, and Meem OnePack, a current account with features of a savings account. In Lebanon, Bank Audi recently completed a full range of NFC (near field communication) contactless payment solutions. Tap2Pay includes contactless cards, NFC mobile payment, stickers for non NFC-enabled mobiles, and wearables (watch, bracelet). Other Lebanese banks are also exploring mobile payment solutions. Fransabank, for example, developed the SIMBA app that allows customers to send and receive money, recharge mobile and internet accounts, and pay parking fees (in addition to regular mobile banking features). Some banks are purchasing turnkey solutions from Fintech startups like Ubanquity. The Ireland-based company offers customizable solutions for banks to cover loyalty programs, mobile payments, bill payments and other built-in value-added services. It also includes advanced reporting tools to track customer engagement and produce extensive analytics in real time. While this is could be seen as a step in the right direction, “it is only expressing the inevitable, not ushering in change,” said Sati. Roy Zakka, founder and CEO of Ubanquity Systems Ltd., acknowledged that the new generation of constantly connected millennials, together with the technological advances available to them, are the perfect ingredients for disruption and innovation. Existing banks will know they are winning in digital when bank valuations start to factor in the future value of proven innovation, in addition to protecting the core franchise.n

Summer 2015 The QuarTerly

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion A Round-Up of Taxi-Booking Apps for Residents in MENA

rogrammatic media buying is rapidly and increasingly redefining the entire media business. It is still complex and specialized, but no longer a small opportunity or adjunct component of “the buy”. Growth forecasts are ubiquitous but here is just one that sets the scene: according to IDC analysts, global spend via programmatic topped US$4.8 billion in 2013 and was due to double to US$8.5 billion in 2014, increasing to US$14.7 billion this year, to US$38.1 billion by 2016, and US$55.3 billion by 2017. Agencies, publishers, and advertisers alike are investing significant resources

The QuarTerly Summer 2015

and budgets. Shifting agency structures have seen the insertion of programmatic into the core of the planning and buying functions. Publishers, initially wary of losing yields, understand that programmatic can now significantly boost their CPMs. Big brands who were once engulfed by programmatic without actually being structured to handle it are restructuring around data-driven marketing and reviewing their approach to media buying as a whole. These are the key players in the equation, so let’s take a look at how they have changed and what trends we can look out for in the coming year.

Agencies

The staggering growth in programmatic marks a complete shift in how it is has been historically perceived versus today. It no longer lives in silo. It is now a core element of the media ecosystem in its own right, sitting centrally within our clients’ businesses, as the barriers to entry continue to be lifted. At Vivaki, we are now starting to see entire campaigns run off the back of programmatic. And so, earlier this year, we embarked on integrating programmatic planning and buying into the core media practice and closer to our clients.

SEAMLESS ONLINE CHECK-OUT EXPERIENCE FOR MORE INFORMATION CALL US AT +971 4 4252690 OR VISIT PAYFORT.COM

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion

The complexity of programmatic still requires a core operating system to centralize tech and data and, as such, we kept these teams aggregated within VivaKi in order to serve as a centralized point of expertise. Today’s technologies may be obsolete tomorrow. And tomorrow, there will be new challenges. That’s why centralized hubs make sense, acting as a vetting agent for technologies. If you had every DSP (demand-side platform) in the industry going up and holding a contract with each individual agency, it makes the process cumbersome. This is a marketplace that has changed at such a rapid pace over the last few years. Any agency that stands still in such a dynamic marketplace is unlikely to survive. We have to keep evolving as the market does – it’s what agency groups have always done and, as a communications network, we know we must do things differently to stand out.

are a ploy to get a chunk of the massive

TV budgets that are constantly shifting A Round-Up of Taxi-Booking Apps for Residents in MENA

Publishers

Programmatic is about all media and all quality of media. The question of whether programmatic is just about remnant inventory or not is no longer justified. You only have to look at the major names publicly announcing their push toward automated trading to know that publishers - and broadcasters - have realized the potential. CNN, Reuters, FT (Financial Times), The Economist and The Guardian are the latest international publishers to announce a consortium (Pangea) focused on leveraging their audience data through a central programmatic exchange. Others include La Place Media in France, SouthernX in Africa, Project Agora in Greece and Romania and Apex in Australia. Start talking about video inventory and the story gets even more interesting. The recent spate of acquisitions by large publishers (BrightRoll by Yahoo!, LiveRail by Facebook and Adapt.tv by AOL) is a sign that the industry is putting some serious backing behind video. The increasing shift of investment from ‘banners’ to ‘video and content’ in digital display has been a headline story for media agencies in recent years. Over thirty percent of all video is forecast to

The QuarTerly Summer 2015

Marco Bertozzi is the President, Global Clients, at Vivaki. He is responsible for the programmatic strategy for senior global accounts. Working alongside agency leadership teams across Publicis Groupe and with senior client stakeholders Marco consults and advises advertisers on focusing their marketing around the opportunities of data, tech and content. Joining VivaKi in 2010, Marco launched and spearheaded the strategy for addressability. As President of Audience on Demand EMEA and NA Client Services, he was responsible for driving the phenomenal growth of Audience on Demand. He also led VivaKi’s Partnerships practice, identifying emerging partners and solutions that benefit both clients and the broader organisation. be traded programmatically in 2015. Many years ago, advertisers were resistant to shifting their abovethe-line budgets into digital media. However, changes in audience behavior from live TV to catch-up and PVR (Personal Video Recorder) has meant that advertisers are having to move chunks of their large TV budgets into VoD (video-on-demand) to reach these ’lost’ audiences. So the investments by Yahoo, Facebook, and AOL are not designed to get more of the digital display pot. They

to digital. The ability to be bought as part of a single platform solution means that, aside from making life a little easier from a relationship perspective, providing a degree of familiarity and trust for both traders and clients who are more used to dealing with larger digital publishers. There is also potential for these platforms to be rolled into existing trading deals. This is exciting because for the first time, we will be able to properly reshape the planning and execution of video budgets across the whole supply chain. It also represents an opportunity for brand advertisers to really immerse themselves in the world of automated trading. Currently, this space is dominated by advertisers focused on performance due to many brand advertisers and planners holding the view that programmatic hinders creative and contextual capability. The argument has always been that broadcasters are sold out. For us, this screams of opportunity. By using an auction platform, they can drive prices even further up. If the inventory is as strong as we all believe it to be, then it should deliver great results and deliver a win-win all around. There is also now increasing talk of linear TV (programming you can only watch at a specific time) opening up to programmatic buying. Research firm Strategy Analytics predicts 20 percent of US TV ad dollars to be spent programmatically by 2018. This is likely inflated from the reality, but it points to a trend that all sides are hungry to see more linear TV inventory enter the programmatic arena.

Advertisers

I have seen, in just a few months, advertisers appointing people to lead the programmatic efforts of their businesses; people who can truly dedicate time and effort to the space and establish a real and deep understanding of the topic. As anyone who has been around the block a little knows, an educated client is a good client. Contrary to what you may believe when you are starting out in your career - that a client who does not understand a topic puts you in a

strong position - we know the opposite is true and that is where we are getting to now. My conversations with clients are becoming more detailed, much bigger in ambition and scope and, for the first time, challenging the total ecosystem. The more questions are being asked by clients, the more they realize that billions of dollars are being spent on companies that have been hood winking them and continue to do so. It is no surprise to see many of the RTB (real-time bidding) networks and managed service DSPs struggling. As one of the financial analysts said: “We were wowed by their algorithms but discovered they were just arbitraging media.” There is still much to play out but, I sense that many advertisers, as they dig deeper into the topic, are discovering that there is a lot to do to be successful; and owning a DSP contract will not solve for that and, if anything, will add cost. They are now understanding that no one tech partner can solve their programmatic needs and that their agency still has a huge part to play.

The Group Still Lagging Behind: the Creatives

Before we all start patting ourselves on the back about getting to grips with programmatic, let’s not forget the other crucial element in the equation. Whilst media agencies, publishers and clients have advanced rapidly in getting to grips with the new state of advertising, one group lags behind: the creatives. We have become obsessed with targeting, but less so with the content we deliver to the target. As technology continues to improve, we have seen a marginal improvement in our creative and content, but only as far as the banner is concerned. Companies such as Criteo set the early benchmark with the combination of text and image linked to a specific signal, but this is way too basic when you look at the potential of a totally blank canvas. All the companies that specialize in what is called dynamic creative optimization have to recognize that the output is – compared with the brilliant ideas that come to life in other

media – neither dynamic nor creative. What is needed is for creative agencies to stand up, take notice and start engaging. There is real need for a change in mindset, moving away from only thinking about the 30-second TV spot and understanding that being creative in this new world means understanding that the way we all consume media has fundamentally changed. And the same goes for how we advertise. The past five years have been exciting and, yes, technology has revolutionized the way media is planned and bought, and will continue to do so. But we have reached a pivotal moment. Now is the time for creative agencies to embrace and improve the potential of programmatic. And if they don’t? There is huge potential for media companies to step into the space and produce great creative that is relevant, measurable and appropriately targeted. If creative agencies continue to dismiss programmatic, I can guarantee that media and other companies will fill the void.n

"THE SPECIES WITH THE BEST CHANCES OF SURVIVAL ARE THOSE THAT ARE MOST READY TO ADAPT" CHARLES R. DARWIN

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion

The App OppOrTuniTy in MenA

A Round-Up of Taxi-Booking Apps for Residents in MENA

Which Sectors Are Ripe for New Entrants? By Narain Jhangiani-Jashanmal | @njashanmal

n early 2012, Facebook found itself in a position that many businesses find themselves in today; the people using Facebook were migrating away from the desktop website to the mobile web and mobile appsâ&#x20AC;&#x201D;a behavior spurred by the rapid adoption of Appleâ&#x20AC;&#x2122;s iPhone and Android-based smartphones.

The QuarTerly Summer 2015

Later that year, Mark Zuckerberg spoke about how the company pivoted to become a mobile first enterprise during an interview at Techcrunch Disrupt. The bet worked and today Facebook is one of the most pervasive and heavily-used mobile applications out there.

From Offline to Mobile, Skipping the Desktop Age

While the shift to mobile is perhaps less of a pressing existential dilemma for non-technology firms, it is undeniable that the consumer behavior around it is having a significant impact on how businesses acquire, engage

Why Native Apps Are King The increasing popularity of native mobile apps is in part due to the performance edge that they have compared to mobile web apps and to things that native apps can do that mobile web apps canâ&#x20AC;&#x2122;t, for example: Offline functionality - news reading apps like Pocket take advantage of this Access to hardware features like the camera and gyroscopes â&#x20AC;&#x201C; many photography and mapping apps offer this option Persistent login - unlike with the browser, once people login to an app they usually remain logged in, which removes significant friction and speeds up actions within apps Push notifications - a crucial way of getting people back into apps and triggering specific actions App events - offer the ability to group and segment people using an app to a high degree of granularity and retarget them based on specific actions they have taken within the app

with, retain, and drive long-term value from their customers. Letâ&#x20AC;&#x2122;s look at the three largest markets in the MENA region (the UAE, Saudi Arabia, Egypt) with the number of people on Facebook and their mobile behavior as a proxy for the market as a whole.

The numbers in Figure 1 speak for themselves. People in the region overwhelmingly use mobile devices as their primary computing device and within that Android devices represent the substantial majority. This is a growing market, waiting to be served. Mobile devices are blurring the lines between the physical and digital worlds, enabling the realtime mediation of supply and demand. Apps like Uber or Careem could not have existed on desktop; the service they provide is born from behavior inherent to mobile. This same consumer behavior is permeating businesses in all sectors. People coming online for the first time are doing so from mobile devices, free from the legacy of the desktop web with no particular affinity for the brands and services that shaped that era. What is also clear is that native mobile applications are handily winning against the mobile web, as illustrated by the charts from Flurry, a mobile analytics firm (Figure 2 and Figure 3). These charts are based on US data, but given that smartphone usage in MENA over-indexes the rest of the world, the trend shown is likely more pronounced in the region. While fostering an ecosystem that

can help build an export economy for apps from the MENA region is a worthy ambition, equally, there is a more immediate opportunity for local businesses to build services that cater to regional specificities. Online retail is an example of a sector that has been quick to embrace this. All of the major eCommerce players in the region have released native mobile apps in the past year or so and in most regional markets rank above international competitors like Amazon and Wish in the local app stores. Local pricing, delivery times, ability to easily return items, cash-on-delivery, local language support both in terms of the interface and customer service are all requirements that favor local apps compared to global ones.

A Case from the West

A good example of a traditional business adapting to this reality by analyzing the behavior of their customers, identifying market opportunity, and using the technology tools available to build an app that delivers both utility and delight to their customers while also making a significant contribution to their business is the US retailer Target and its

Summer 2015 The QuarTerly

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion Cartwheel app. Target already had a legacy desktop and mobile friendly eCommerce site and a newer eCommerce app. However, their physical locations remained a fundamental part of their business, so they built a separate app whose sole purpose is to assist customers with product discovery based on their purchase history and then drive customers in store to purchase those items, incentivizing them to do so using coupons, a distinctly US consumer behavior. Within a few weeks of launch, the Cartwheel app was already seeing a significantly higher number of downloads than the existing eCommerce app. This trend has remained the same ever since, making Cartwheel a core part of Target’s digital strategy.

A Round-Up of Taxi-Booking Apps for Residents in MENA Figure 1: A breakdown of how users accessed

The App Opportunity for Businesses in MENA

Based on a personal assessment, combined with some of the other data presented in this article, here’s an attempt at mapping the opportunities for apps in the MENA region on both iOS and Android. When thinking about weighting the opportunities, some of the following factors were taken into account: strength of existing players in the space, whether those players have generic propositions or if their services are tailored to the region, the white spaces that exist for potential disruption in a given sector, and how much impact such disruption could have. Though not comprehensive, this chart indicates that while there are some strong regional players in these key categories, other areas are wide open.

Time to Think Mobile First

In conclusion, mobile devices are where a growing majority of people are spending most of their time, and spending time in apps is what they’re doing on those devices. Given the lead times involved, if you’re building something now, think of how the world is going to look like in 18 months when you ship it. One thing that is clear is that if you’re not thinking mobile first, and more specifically, about building an app rather than web, then it may be worth

The QuarTerly Summer 2015

Facebook in April, 2015

76%

52%

24%

7% 0.8% Desktop Only

Mobile Only

Computer iPhone/ iPod

iPad

0.2% Android Blackberry Mobile Web

0.8%

Feature Unknown Phone

Source: Facebook Audience Insights

Figure 2: Percentage of time spent on Apps vs. mobile web

20%

14%

80%

86% Apps Mobile Web

Source: Flury Analytics, ComScore

Figure 3: Time spent on iOS and Android connected devices

Google Browsers 5%

14% Browser

Others 2%

Apple Safari 7%

86% Apps

Others 2%

Gaming 32%

News 3% Productivity 4%

Utilities 8% Entertainment 4% YouTube 4%

Facebook 17% Twitter 1.5%

Source: Flury Analytics, ComScore, NetMarketShare

going back to the drawing board. The good news is that building an app today is easier than ever before

and likely to get even easier over time. Solutions like Parse, which Facebook acquired in 2013.

Finally, the important thing to bear in mind is that the best mobile apps focus on solving for one particular problem. The opportunity for your business is to zero in on a particular pain point and build an app that addresses it, thus allowing your business not only to serve existing customers more effectively, but also to use the app as a channel to acquire new ones.n

Figure 4: App Opportunity by Sector in the MENA Category

Regional

Global

Opportunity

Deals

The Entertainer

Groupon

Medium

Communications

Nymgo

Skype

High

Google

Low

Listings

Dubizzle

Craigslist

High

Jobs

Bayt

Linkedin Jobs

Medium

News

Nabd

Flipboard

Medium

Local Discovery

Jeeran

Foursquare

High

Music

Anghami

Deezer

Medium

Online Retail

Souq

Amazon/Wish

Medium

Dating/Matriomonial

et3arraf

Zoosk

High

Payment

Beam Wallet

Paypal

High

Real Estate

Property Finder

N/A

High

Ticketing

Ticketmaster

High

Events

Eventbright

High

Finance

Mint

High

Biz Networking

High

Rentals

Airbnb

High

Dining

ReserveOut

Opentable

High

Travel

Tripadvisor

High

Auto

Carymotors

N/A

High

Transportation

Careem

Uber

Low

Education

Khan Academy

High

Microwork

Nabbesh*

Elance/Odesk

High

Subscription Retail

Glambox*

N/A

High

Food Delivery

Talabat

Hellofood

Medium

Narain Jhangiani-Jashanmal joined Facebook in early 2014 and presently leads the Direct Response Advertising team for the MENA region, which focuses on Retail, eCommerce, Media, Entertaiment and Mobile Apps. Prior to Facebook he worked at the Jashanmal Group for 10 years in various roles covering Retail, Print Media distribution, Strategy and Communications. He is a graduate of New York Universityâ&#x20AC;&#x2122;s TISCH School of the Arts.

Figure 5: Rank of Local Retail Apps in Arab Countries Country

Souq

Namshi

Android iPhone

Android* iPhone

Android

iPhone

Android

iPhone

Android

iPhone

Android

iPhone Android

iPhone

UAE

Saudi Arabia

Kuwait

Jordan Egypt

30 1

MarkaVIP

25 -

Jumia

3 17

Xcite

Notes: *Namshi categorizes their app in the Lifestyle category as opposed to Shopping There is no specific Google Play store for Jordan

eXtra Stores

Carrefour UAE

Source: App Annie

Summer 2015 The QuarTerly

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion A Round-Up of Taxi-Booking Apps for Residents in MENA

Top 10

DigiTAl ADverTising Tools for BeTTer ImpacT

Measuring, Optimizing, and Reaping the Rewards of Digital Advertising By Romeo Chalfoun | @RomeoChl

echnology tools play an integral role in helping digital advertisers measure the effectiveness of a marketing campaign through audience response. Advertisers can get similar insights from the ad networks on the platforms they

The QuarTerly Summer 2015

use for advertising, but using the right digital advertising tools can give them an edge. ArabNet picked the brains of 3 skilled advertisersâ&#x20AC;&#x201D;Iman Mosaad, and Ahdab Badr, respectively Senior Business

Development Manager and Senior Digital Media Manager of Digital Republic, as well as Boye Balogun, Managing Director of Future Tech Mediaâ&#x20AC;&#x201D;to compile a list of the advertising tools that can have the most impact.

Know Your Audience Every Step of the Way

“The first essential driver for our campaigns is to understand our audience; to realize what they respond to,” says Iman Mossad. Boye Balogun concurs: “The more you know about the people that engage with your ads, the better you can capture your customers’ attention and get them to take action.” In digital marketing, this can only work with online tools. The tools listed in this section may be indirect catalysts to running a successful campaign, but they help build ads that resonate with their intended audience, and to better reach out to them.

Iman Mosaad, Senior Business Development Manager at Digital Republic

Boye Balogun, Managing Director of Future Tech Media

See All Your Data in One Place 1. Sysomos gives real-time information on any social media conversation linked to a brand or product while showing insights on the conversation drivers. It does so by getting as much relevant data as possible from social networks, message boards, wikis, and major news sources. It then uses contextual text analytics and high level data-mining technology to reveal meaning in the data by analyzing the tone and sentiment of conversations through segmented demographics.

2. CrowdBabble is a social media measurement tool that caught our attention because its Founder and CEO Abbas Alidina hails from Dubai originally. This tool is mainly focused on social media engagement and insights, perhaps a bit like “Social Bakers”. One of its most distinctive features is measuring, benchmarking, and optimizing presence on Instagram with easy-to-use reports.

3. Marin Software is a campaign management, reporting, and optimization platform that helps marketers scale their programs, make better bidding decisions, and of course, target their audience more effectively. It is built with an intuitive design and open, cross-channel architecture, which help Facebook and Twitter advertisers increase their social advertising ROI.

4. Sprinklr offers engagement metrics and social media listening by connecting social media insights with critical enterprise systems and CRM. Its “Listening & Trend Discovery” tool was named “the most powerful technology in the market” by Forrester Research.

One-stop shops can keep the creative process flowing by putting all different accounts and tools in a single place. “One-stop shops won’t allow you to do all the little tasks. But being able to see everything in one place removes the hassle of navigating from one platform to the other,” said Balogun. In this list, the one-stopshop we will name is:

5. Geckoboard is simple, yet it shows you all key data metrics in one place, and allows users to communicate this information across their organization in a visually attractive way. This single platform available on web and mobile lets users monitor everything from CRM, email, infrastructure, project management, sales and finance, social media, and web analytics. Overall though, it is considered an entry product for marketers new to digital advertising. A slightly older platform called Tableau might be a bit more complicated to use, but is more fitting for advanced advertisers because it allows heavier modifications to extracted data.

Summer 2015 The QuarTerly

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion Lose That Fear and Follow A Round-Up Your Gut of

Target the Customers

Who Already Visited You Taxi-Booking Apps for Residents in MENA

“Consider changing your message when retargeting. But always assess and optimize your advertising strategy to increase your conversion rate,” says Ahdab Badr. The following tool will help you do exactly that:

Ever had that sensation that a specific picture, button, or call-to-action in an ad would work better a different way? If so, A/B testing tools are your friend.

6. Google Campaign Experiments may still be in beta but their A/B testing flexibility allows advertisers to assign a specific percentage of the Google Adwords auctions to go towards one of their ads, testing changes to keywords, bids, ad groups, and placements. This minimizes risk on hypotheticals and encourages advertisers to test something based on a hunch. Advertisers can choose to give 10% of their advertising budget to a new idea and figure out if it delivers better or worse. This in turn helps make better decisions and increase return on investment.

7. AdsEspresso is designed specifically for A/B testing Facebook ads. Advertisers can try out different approaches for multiple target audiences, allowing faster performance reports to save money from underperforming ads, presented in customizable dashboards, or in detailed metrics.

You Got Them to Click, Now What?

When customers click on an ad, they are usually led to a webpage, which means the ad has done its job of getting the customer into the “shop.” Now how can you get your customer to buy that TV, sign that form, fill that survey, or

The QuarTerly Summer 2015

Ahdab Badr, Senior Digital Media Manager at Digital Republic

subscribe to that newsletter?

8. Optimizely is a world-class website optimization platform that offers simple yet powerful A/B and multivariate testing for landing pages. This gives both newbies and veterans a way to make dynamic changes to their website by testing page variations to live traffic, collecting immediate performance data. In turn, this helps deliver a wholesome experience to customers who click on the ad. Starbucks, Disney, eBay, Weather.com, Demand Media, and Crate & Barrel have all used the platform. Optimizely boasts that +190,000 experiments have been run on its platform.

9. Inspectlet gives webmasters a deeper understanding of customer behavior by allowing them to observe their live actions. Its “Session Recording” feature lets them watch every mouse movement, scroll, click, and key press on the website. It also displays heatmaps for a wider understanding of clicks and scrolls, and even eye motions as interpreted by mouse movements.

10. Adroll has great retargeting and remarketing capabilities for most - if not all - major ad networks and social media channels. It allows smarter bidding and optimization, and its “Customer Audiences” tab helps display the ads with smarter targeting. Badr recommended Adroll: “When we started using it, this tool often gave us 50% more conversions with a 10% CTR (click-through-rate), resulting in efficient, high performing campaigns,” she said.

Honorable Mentions

Many specialized advertising tools exist or are currently in development. Two among those stood out from the crowd thanks to their unique features and earned an “honorable mention” in this listing. MixPanel is the only data platform that allows advertisers to directly ask specific questions about users’ behavior, such as: “Of my paying customers, how many arrived from a Facebook ad, are located in Dubai, and haven’t logged in for two months?” It offers custom reports on user engagement and retention, as well as targeted communication and A/B testing. It is essentially focused on analytics for mobile apps, but also works well with web applications. Innbx (still in beta) is a social media monitoring tool being developed by Dubai-based Brndstr. One if its unique features is organizing people you follow on Instagram into lists, an option similar to Twitter lists. We hope these technology tools will skyrocket your advertising results.n

DIGITAL MEDIA

STRATEGIES UsefUlSURVIVAL Apps for TrAnsporTATion A Round-Up of Taxi-Booking for Residents in MENA IN FORApps NEWSPAPERS THE DIGITAL AGE

An Interview with Nayla Tueni, CEO of An-Nahar Newspaper By Alexis Baghdadi | @GuerrillaWriter

n-Nahar, one of the leading Arabic newspapers in Lebanon has embarked on an ambitious shift to a primarily digital model since 2012. This does not augur the end of print newspapers in any way anytime soon, but it does shed light on the fact that there is no more growth possible there. An-Nahar plans on becoming onlineoriented by end-2015. The newspaper envisages growing into a multichannel medium (print, web, social media, mobile, VOD, etc.) rather than becoming a digital-only channel. Naturally, each channel will have its own audience and will focus on a different type of content to accommodate its readers’ tastes. An-Nahar CEO Nayla Tueni was a speaker at ArabNet Beirut 2015 and spoke to us about the newspaper’s new digital ventures. How has the content of An-Nahar changed to adapt to different channels? The content of our online channel is completely different from our print version. From our website (www.annahar. com), you can access the newspaper’s content and you can also get the latest stories covering political, health, sports, economy, and lifestyle news. These categories have evolved into almost autonomous “mini-websites”, something we can’t do with print. We want to please our audience, no matter the platform, but we need to watch out for our brand. It is necessary to strike a balance between content that generates traffic and different content that adds value. On one hand, An-Nahar’s legacy is that of a thought leader with an 80-year history we want to preserve and build

The QuarTerly summer Summer 2015

Nayla Tueini, CEO at An-Nahar

on. But we are not afraid of change. We understand that being digital requires a young and bold attitude, and we recognize that evolution needs to be initiated carefully so as not to alienate readers or lose our identity. Content in our digital channels is necessarily different in format and form. There is no contradiction between traditional “hard” journalistic content and its new “light” offshoots. They complement each other in terms of diversity and driving traffic. It’s no secret we have invested in all types of health content and we are not shy to write about sexual health like western newspapers,

but that’s only one type of story out of hundreds Print is here to stay, but as we move into a digital medium, we are slowly and subtly starting to change the way the information is being presented. AnNahar’s print newspaper will include handpicked editorial news for a loyal user base, coupled with more analyses, for example, while our online channels will break the news to allow us to remain competitive. We have achieved our dream of becoming a multichannel news service, and we are always exploring new ideas to see where we can take An-Nahar.

MILESTONES IN AN-NAHAR’S DIGITAL STRATEGY What are some of the differences between online consumers of An-Nahar and the more traditional offline readers? When we first initiated our new online strategy in 2012, our reader base got confused because it was used to the print version and the PDF and HTML copies on our website (online since 2002). However, today our channels have matured and acquired almost separate identities. New audiences have emerged and adopted different channels. We expanded our target audience to include more young people, women and, of course, the online community at large. When it comes to readers’ behavior, online readers mostly look for shorter, quick news delivered in real time. We also notice that internationally trending stories are more likely to engage online readers, as opposed to local social or political news. However, these users will also enjoy longer articles if they are well written and original. Which are the most important platforms for you, and what strategy do you adopt for each one? Our homepage is our most valuable channel. It requires a lot of care as it caters to a very wide and diverse audience. Every day we post hundreds of different articles catering to different audiences. Although only 5 to 10 of these articles will drive huge traffic, it’s the long tail of content that attracts a growing number of visitors and guarantees they come back. Twitter attracts a news-hungry audience that is more politically aware and opinionated. It can influence news distribution significantly but not necessarily drive traffic. So it is ideal for passing news, such as quick alerts, live coverage and short topics. A quick alert would first appear on

1998

First Arabic language HTML edition launched First newspaper to post its headlines in audio format

2002

Tabloid version sold through vending machines 2 electronic editions launched (PDF on annahar.com.lb and HTML on annaharonline.com)

2009

An-Nahar web TV launched

2011

New An-Nahar layout and iPad application launched

2012

New independent digital version launched on www.annahar.com

MAR

2013

JUN

2013

JUL

2013

DEC

2013

FEB

2014

AUG

2014 DEC

2014

MAR

2015 TODAY COMING SOON

200 daily posts

New design integrated into website Archives posted online (from 1982 onwards) 300 daily posts Updated versions of mobile apps launched An-Nahar English and French versions launched in Beta An-Nahar TV launched as VOD platform

WhatsApp service launched 350 daily posts Opt-in newsletter (daily and weekly digest)

Summer 2015 The QuarTerly summer

DIGITAL MEDIA

UsefUl Apps for TrAnsporTATion

Twitter then, as the story expands, would find a place on our site with quick updates on Twitter to keep users aware. Facebook is essential to traffic generation and the audience leans more towards magazine-type content like larger, well-written stories, including editorials. They also love viral news – if you have unique content like we do, Facebook becomes very significant. You would only break really important news on Facebook so as not to bombard users – and ensure there is more info to support their hunger for content. We see Facebook as the homepage for our new younger audience and a great tool to convert them into fulltime visitors of our other channels. We are now exploring smartphones as a new medium to address a younger readership. Our recent WhatsApp channel is expected to have a massive audience. Later, Instagram will allow us to connect with our readers visually and share behind-the-scenes photos. We are also experimenting with SnapChat and other possibilities. An-Nahar TV is our VOD channel which we think will become our most important channel. For now, we use it to experiment with different types of content (horoscopes, fitness, political talk shows, reportages and even informative presentations) to find out what readers like. At present, video complements existing content, but in the future there will be opportunities for content that will only be valuable if done through video.

and-referral, and direct traffic, which still

shut down because of it. Change is

is important nowadays, but it is only beneficial when it drives high conversion and loyalty. This is not always the case, but we are exploring that direction. It will allow us to access new markets and experiment with new ideas.

draining when it is not embraced. From our learnings, we found that you need both a patient long-term plan and another that delivers immediate results since everything in the internet is measurable. For the short term, we set up a separate digital editorial department creating content on a minute-by-minute basis. We now generate hundreds of pieces of content exclusive to annahar.com. In the first 18 months, this team was initially very independent from the rest of the organization. In the past year, however, we have deployed conscious efforts to bring the digital and print teams together and find more ways to create digital content. One person at a time, everyone starts to see the value of the internet as a great content creation opportunity. On the long term, we are encouraging staff members to start considering a world where print and digital can live side by side by continuously sharing information and bringing them presentations, trainings and workshops. We regularly invite international and regional media experts to share how their organizations are taking advantage of all that the internet has to offer. Regular sharing of traffic info and growth, especially little things like highlighting whose online articles are read most, motivates staff to get involved. An-Nahar TV is a perfect example of this sort of relationship; we worked with many Lebanese bloggers to develop content, but also made sure that many of our established An-Nahar exclusive writers shared their thoughts on the web.

plays the most significant role. Paid traffic in MENA challenging and can be financially A Round-Up of Taxi-Booking Apps for Residents

How do you measure and increase traffic to your online channels? Everything in our online strategy contributed to increasing our online traffic. Social media, particularly Facebook, has become the number one driver of traffic, replacing search. However, this is not the bigger part of our traffic. We rely on direct traffic as part of our loyalty and brand strategy. We haven’t allocated any budget for marketing our website online, so this is purely organic growth. For now we are focusing on product development and content, but when we see an opportunity to scale through paid marketing, we will definitely consider it. Like any successful news website, our traffic is divided into social, search-

The QuarTerly Summer 2015

Did you have a concerted strategy for increasing traffic? Our strategy involved starting with building loyalty and awareness so that people would know where we were heading and consider us as their new destination for real time news and wide coverage. We measured this by the number of returning and loyal users on the site, as well as the time they spent there. Next we worked on optimizing our current products to keep our users happy and make sure that new visitors would return. Compared to other local newspapers, visitors spend a longer period of time on our site (between 7.5 and 9 minutes per visitor). Finally, we focused on conversion and set targets for the number of visitors. We went from 500,000 unique visitors in 2012 to around 3 million in 2 years. We have also acquired the ability to reach an international audience who does not have access to the print edition. We are aiming to reach 5 million visitors by end 2015. Let’s be ambitious! How do you transition the staff to a digital mindset? This is easier said than done. All over the world, print staff feel threatened by the internet as they have seen many businesses

How has online revenue grown since 2012, and how does it compare to the overall revenue in percentage? Online revenue has been growing by 50% annually. This number would be much higher if it weren’t for the difficult economic and political situation we are facing in Lebanon. For now, our sources of revenue are mainly local from Lebanese advertisers, so we are making great efforts to evolve annahar.com and make it a Pan Arab website so we can benefit from regional opportunities. While these revenues are growing, they still make up only a small percentage of total revenues, but it is the key to future sustainability. n

JOIN THE ARABNET TEAM! MARKETING

BUSINESS DEVELOPMENT

CONFERENCES & MEDIA

Develop marketing activities for one the region’s fastest growing digital brands! Implement online and offline campaigns, run our flourishing social media channels and tailor communications to our audience of more than 20,000 professionals and entrepreneurs.

Build business relationships with decision-makers at the region’s top corporations, and work with clients to help them accomplish their marketing objectives through ArabNet’s activities.

What’s hot and what’s not? Stay on top of the latest trends in digital business, connect with industry leaders, and help shape the conversation across ArabNet’s conferences and media platforms.

WHY WORK WITH US? JOIN

a young, creative, and dynamic team

EXPAND

EXCEL

with lots of room for growth

your business network

BUILD

expertise in a rapidly growing industry

CHALLENGE

yourself and build your career

Send your CV to: jobs@arabnet.me

CHANGING MEDIA PATTERNS DURING RAMADAN

ONLINE MEDIA CONSUMPTION Catchup Video Views

Cooking Website Views Increased by

Increased by

153%

382%

PEAK TIMES OF MEDIA CONSUMPTION Online video consumption increases starting

10PM

TV Peak Time

6PM-9PM

Cooking Websites’ Traffic Peak Times

4PM in preparation for Iftar 12:00AM in preparation for Suhour or next day’s Iftar

Peaks at

5AM

4AM during Suhour

Music Streaming

20% Shifts from a day consumption to a night consumption

Night consumption in KSA is higher than all other countries by 20%

Peaks between 12AM and 3AM

CONSUMPTION OF RAMADAN-RELATED ONLINE CONTENT Ramadan-related content contributed to 60% of total online video views

60%

Traffic to Cooking sections

Traffic to Ramadan-related music increased by

increased by

30%

40% between 3PM and 5PM

Top streamed song is “Law” of Elissa, a song from a Ramadan TV show

MULTI-SCREEN CONSUMPTION

90% use mobile while

watching TV in KSA

MEDIA SPEND Offline Media Spend Up by

Digital Media Spend Up by

Online Campaigns up by

46%

35%

126%

Sources: Anghami • Shahid.net • MBC Group • MBC.net • Shahiya.com • Digital Media Services

ENTREPRENEURSHIP

UsefUl Apps for Meet theTrAnsporTATion Latest A Round-Up of Taxi-Booking Apps for Residents in MENA

Venture Capital FirMs Launching in Mena

arzan Venture Capital

rzan Venture Capital launched in late 2014 as the venture capital arm of Arzan Financial Group in Kuwait to support the entrepreneurial ecosystem through their starter $5 million fund. Some of their portfolio companies include Idinaidi.ru, a residential real estate portal in Russia; MENA Commerce, a big-data

The QuarTerly Summer 2015

startup that focuses on the retail industry; and Ecosys Solutions which manufactures the PET Recycler machine. We interviewed the investment team at Arzan Venture Capital: Hassan Zainal, Anurag Agarwal, and Ahmad Takatkah. What companies do you consider investing in? We focus on early growth (series A or pre-series A) startups because we have the necessary skills and experience to bring added value to this segment. We look for startups that utilize technology in general. The VC market is very new and we’re building our expertise as we go, so

focusing on specific technology segments will not be sufficient to build a highquality pipeline. We like to invest in startups in the MENA region who have the possibility to expand abroad. We also look at startups outside the MENA whose products or services could eventually come to the region. The technology sector isn’t geographically limited, so there can’t be such a thing as an investment purely for a MENA startup. When we invest in international companies, we gain access to a bigger network of VCs and angel investors, which helps us learn more about their

strategy and operations. This will also have an impact on our dealings with entrepreneurs in the region. What is the size per ticket you are aiming to invest? They start at around $150,000 or even $100,000 and go up to $1M. On what basis do you choose the startup you want to invest in? We have a very detailed filtering process. The first things we look at in a startup are its growth potential and its team. After that, we delve into more details before the due diligence process. We then seek to understand its potential in terms of the solutions it provides to the regional and global markets. We also look at the startup from the commercial and financial points of view (such as fees and valuation) before we go for the final approval.

the ball will continue to roll. In addition, we provide mentorship to entrepreneurs and help them whenever possible in planning and re-planning strategies, or putting up their financial model or business plan, and we might even suggest ideas to them, but we do not interfere in their management decisions. We’ve invested in them because we are convinced that they are able of executing their own plans—otherwise, we would have started the companies ourselves. What is your strategy for sourcing deals? We participate in all the events in our region, like the ArabNet or MIT conferences, where we have the chance to meet with startups who then come back to us. We also contact some startups ourselves, and we assess their idea. If a startup’s idea is fit for growth and investment, we visit them and do the analysis.

Mobily Ventures

obily’s corporate venture capital fund was launched in mid-2014 and has so far announced its investment in Easy Taxi, Anghami, Hellofood, and Dokkan Afkar. In this interview, we talk with Daniel Silvestre DosReis, Director at Mobily Ventures.

Why should startups choose your fund? To begin with, we have a big network of investors and wealthy corporations in the GCC and in Silicon Valley. We also have experience with international startups, which constitutes an added value. We have a lot of sister companies in traditional businesses and in technology sectors. Basically, what we try to do is support our early growth companies by introducing them to our networks and to our sister companies that might become their clients. So in a way we’re boosting their revenue and we also improving their cost-efficiency. I think it’s all about building the first initial touch and then

What companies do you consider investing in? Mobily Ventures is interested in internetbased B2C or B2B startups that are either based in the MENA, or operating in the region, or serving it. We’re not limited to investing in Saudi startups only, but it’s certainly difficult for us to find more companies abroad when we’re based here. We have 6 focus areas when it comes to the startups we select: 1) Online and mobile banking and payments; 2) Digital media and entertainment like Anghami music streaming, or streaming services; 3) Retail innovation and ecommerce; 4) Data monetization and digital advertising; 5) B2B IT and Cloud

computing, i.e. infrastructure as a service (IaaS), platform as a service (PaaS), or software as a service (Saas); and 6) a broad product category related to online and mobile services. What is the size per ticket you are aiming to invest? They start at around $250,000-$300,000 and could reach up to $2M or $2.5M. On what basis do you choose the startup you want to invest in? The number one thing we look at is the team. Our second criteria is the startup’s model. Third, we consider the opportunities in the market (competitive intensity, number and size of investments, etc.). Then we study the economics. We look at the company’s business plan model and its valuation, and we try to see if we can find a fair valuation that is acceptable for both the entrepreneur and us as the investor. Finally, we look at the long term and consider the exit prospective. We think about potential acquirers if we ever consider selling the company. We also consider whether it could be an IPO candidate, but this is rarely the case. For now, we believe that an IPO can be realistic probably in the ecommerce base—Souq.com for example. Why should startups choose your fund? First, we’re present in Saudi Arabia, the most important market in the GCC in terms of total population size, high purchasing power, and high mobile and smartphone penetration. But KSA is also a difficult market to enter for foreign players. Anghami can sell subscriptions without having on-ground operations in the country, but if you consider e-commerce companies who have offices and warehouses with a need for employees on the ground, it’s not so easy to set up a business in Saudi Arabia from a competitive landscape. All these factors combined make it a very attractive market where you don’t have many established players to compete. And we are an established player in the country, with a very well-known brand. Our added value is that we can help startups in their customer acquisition phase because we have a strong marketing power with millions

Summer 2015 The QuarTerly

ENTREPRENEURSHIP

UsefUl Apps for TrAnsporTATion of subscribers. For example, we can run their campaigns on Mobily’s social media channels. We can also help with offline and above the line marketing with TV and billboards. We can also make it easier for startups to monetize through billing integration. Because we have data servers in the country, we can also provide startups with a datacenter and host capacity. Additionally, entrepreneurs mostly have only B2C customers, but since we serve enterprises of different sizes, we can integrate software as a service (SaaS) startups in our portfolio and pitch it accordingly. This way, we are enhancing the product proposition.

aiming to invest?

exposure to the entrepreneurial scene.

and go up to SAR 10M (~$2.7M).

programs such as Badir incubators, Sirb angels, KAUST Programs, AccMakk, and Flat6labs accelerators to name a few, which have the potential of harboring future startups, and would always be on our radar. Finally, social media presence helps attract deals to our online application portal, where all deals eventually pour.

They start at around 1M (~$266K) in MENA Second, we have very strong ties with A Round-Up of Taxi-Booking Apps forSAR Residents

What is your strategy for sourcing deals? First of all, we consider the source. For example, a startup that is referred to us—for instance by iMENA—is treated differently than another that comes through email. We also look at who the initial and current investors were – if any. Startups that already received investments means that someone did their homework and analyzed the company in detail to be willing to write a check.

alkhabeer Capital

lkhabeer Capital is a Saudi-based investment firm with over SAR 3.3B worth of assets under management. In December 2014, it launched a new business unit, Alkhabeer Ventures. We interview Khalid Suleimani, Head of Venture Capital at Alkhabeer Capital. What companies do you consider investing in? Alkhabeer Ventures focuses on highgrowth opportunities in technology, mobile apps, new media, e-payment and e-commerce sectors, in addition to new and disruptive technologies such as 3D imaging and internet of things (IoT). What is the size per ticket you are

The QuarTerly Summer 2015

On what basis do you choose the startup you want to invest in? First of all, we check if the startup is incorporated. We then look at the history of sales or if there is a strong customer validation as well as a clear conversion path. We also check if there is a strong commitment from the founding team. Having high scalability potential is very important, too. Last but not least, the company should show it benefits the Saudi economy by either being a Saudi company, having at least one Saudi founder, or by adding value through job creation in Saudi. Why should startups choose your fund? Our belief in entrepreneurship is strong, and is embedded in the company culture. Many members of the Alkhabeer team come from an entrepreneurial background. Also, Alkhabeer has the potential to deliver significant returns for investors and startups alike, through several exit routes such as trade sale to an SME fund or any other third party or even a possible IPO – all available under one roof. We will be active on the board level mentoring, monitoring, providing solid advice on restructuring, opening new markets, and pulling some strings to help the startup grow when needed. Alkhabeer Capital is the first Authorized Person who established a business unit to manage a regulated fund by the CMA to invest in Series “A” startups. Many other ad-hoc funds exist, but they are more of holding companies, or exist outside Saudi Arabia, and do not have the reach nor the connections that would help the startups to grow. We are not biased by the interest of a mother company. Our only focus is to grow the asset and facilitate a most lucrative exit. What is your strategy for sourcing deals? We depend on a number of channels. First, we are very active on the startup scene in the region, being part of many evaluation committees and judging panels. We are also active participants in regional events, which help give the fund

leap Ventures

eirut- and Dubai-based Leap Ventures officially announced during ArabNet Beirut last March the closing of its first round, at $71 million. Henri Asseily, Founding Parter at Leap Ventures, tells us more about the VC. What companies do you consider investing in? We like to invest in companies where we add value. Mostly, this means technology companies, whether hardware, software, or a combination of the two – which is generally the case. This is pretty broad, I know. When you’ve been in this business for long enough, it’s a little difficult to find something we’re not interested in. On the other hand, for example, I am not looking to invest in e-commerce, even though I have a lot of experience in this.

E-commerce necessitates proper logistics. Unfortunately, Lebanon and the Middle East do not offer many good logistical solutions What is the size per ticket you are aiming to invest? Technically, as far as our own investment in a deal is concerned, it is between $3M and $7M. However, at our stage we get a lot of opportunities for co-investments. Our combined investment power could bring our ticket’s size to $5M-$10M or even $12M. That’s a lot of money, we realize. Not many startups ask for that much money, but they should, if they want to attract the best talents and really grow. To keep talented individuals from leaving the country, you need to offer them a good salary and incentives, something in the vicinity of $10,000$15,000 a month. On what basis do you choose the startup you want to invest in? We analyze different criteria in this order: traction, team, market size, and idea. Why should startups choose your fund? We talk to entrepreneurs as someone who has been an entrepreneur. Few people are like us. I can think of Fadi Ghandour from Wamda Capital. He is someone I’d be very happy to work with on deals anyway. We look for cooperation, not competition. Our terms are very entrepreneur-friendly. Some VC firms in the Middle East are very good at extracting additional fees from the startups, which is something we don’t want to do. We are also going to have a support team that will provide the necessary services for startups. At this stage we’re doing it ourselves as partners but we’re in the process of hiring a team that will be able to support the startups in very specific areas, from finances to human resources or online marketing. We never consider replacing or controlling entrepreneurs, otherwise we would never invest in them. However we know that entrepreneurs face difficult issues, especially in the region. For example, it takes a lot of time to find the proper talent to hire. So what we want to do is to give them the necessary resources

that will enable them to grow their company quickly. What is your strategy for sourcing deals? We haven’t announced any deal because we haven’t closed the fund yet. I want to make sure that the deals are properly done so I don’t want to rush into things. Once you show your deals and your startups start talking about them, new leads will come to you.

saned partners

aned Partners has launched a regional fund of $5 million that has already invested in Jordanian company Kharabeesh and Lebanon’s Instabeat and Scoopcity.com. It has also committed capital in Wamda MENA Ventures. Antoine Boustany, Saned’s Investment Manager, tells us more about the fund. What companies do you consider investing in? Our fund doesn’t focus on a particular sector, although we like consumer products and ICT because of its scalability. Of course costs are lower with digital companies, but it doesn’t mean we rule out other sectors.

What is the size per ticket you are aiming to invest? So far, our investments are small, ranging between $100,000 and $200,000 – in some exceptional cases, we might go over this amount. On what basis do you choose the startup you want to invest in? We look at the team even before we consider the product or the company. We have a weighing system for startups in different growth stages from very early growth up to seed funding and Series A. We look at their academic and professional background, as well as their track record. Then we look at what a startup is about, i.e. whether it has a social impact, whether it is unique in the MENA or globally, etc. Third, we look at a target market’s potential and we project the performance of the startups’ product or service in that market. Is it sustainable? Does it have a differentiating proposition or a competitive advantage? Then we go into the technical and legal aspects. Why should startups choose your fund? Our main differentiating characteristic is our response speed. We contact entrepreneurs within 3 weeks to a month (maximum), unlike other VCs who could take up to 3-4 months to give an answer. Second, having a wide network means we can be door openers for startups, whether in Lebanon or the Gulf. We can also offer guidance in case they choose to go for additional rounds of investment. We do not interfere on the daily operational level of companies, unless an entrepreneur asks for our support specifically. What is your strategy for sourcing deals? We participate in ArabNet and other conferences in Lebanon, Jordan, or the UAE to increase our visibility. And we attend launches of government initiatives like the UK Lebanon Tech Hub. We rely on our partners to share opportunities with us. We also leverage our relationship with Wamda and Endeavor, and tend to co-invest with them because their strategies are close to ours. Recently, we signed a protocol of co-investment with the iSME funding program.n

Summer 2015 The QuarTerly

ENTREPRENEURSHIP

how UsefUl toApps win at for TrAnsporTATion talent aCquisition 5 Insights for Building Brand Talent Online and Offline in 2015 By Alexis Baghdadi | @GuerrillaWriter

S I

n this digital age, traditional recruitment has evolved into an online-first talent acquisition strategy. The initial contact point between potential candidates and recruiters today is mainly via social professional networks. A survey by LinkedIn Talent Solutions found that in the past 4 years, the percentage of new hires recruited through these networks has almost doubled, accounting for 38% of total hiring sources. With social media, the job market has shifted from a reactive hiring model to a proactive one. Recruiters can look at a candidate’s social profile and make a decision on whether they should interview them or not in just a few minutes. 82% of employers research a candidate online before calling them for an interview, according to the October 2014 Social Recruiting in the Middle East and North Africa poll by Bayt. com. Global recruiting leaders agree that quality of hire is the most valuable metric for measuring recruiting team performance. Their focus is on improving

The QuarTerly Summer 2015

the basics: sourcing, pipelining, and hiring the best talent - and, ultimately, retaining them. For a large company like GE with over 300,000 employees in 170 locations worldwide this involves strengthening the candidate connection through all stages of recruitment - and beyond - to engage them as talent partners. While the recruitment process may have evolved in form, a lot of the fundamentals remain very much the same in essence. Daragh O’Haire, Global Talent Recruitment - Center of Excellence Leader at GE Middle East, North Africa & Turkey (MENAT) took the time to share with ArabNet his insights on new global and regional recruitment trends. 1. Social recruiting is faster but still requires face-to-face touchpoints LinkedIn Talent Solutions lists internet job boards and social professional networks as the top sources for quality hires. For O’Haire the evolution of recruitment can be summed up in one word: faster. “Better availability and

accessibility make the cycle from searching for jobs to evaluating offers and applying for open positions much shorter,” he said. According to him, the main benefit of social networks lies in establishing initial contact between recruiters and jobseekers. This is great news for startups who are extremely fast-paced and often don’t have a proper HR department in place; they can find candidates in just a few minutes. By hiring online, it is easier for companies to interact and engage with candidates. They can also ask them industry-related questions and evaluate their answers. These networks may have revolutionized the way employees and employers connect, but not to the point where they can fully replace face-to-face interaction. Such touchpoints are still needed to address trust concerns. The key is to put in place a recruitment process that accounts for such contingencies and uses tools like video conferencing. “As long as this recruitment process isn’t compromised, our telepresence is virtually the same as face-to-face situations,”

said O’Haire. However, he clarified that in some cases (hiring for highly sensitive departments or top management positions) trust is so vital that social networks cannot replace personal referrals: “There is less social media penetration the higher up the ranks we recruit.”

On the practical side, 75% of global talent acquisition leaders say talent brand has a significant impact on their ability to hire great talent. According to LinkedIn Talent Solutions, a strong talent brand can reduce cost per hire by over 50% and lower turnover rates by 28%.

2. Invest in your talent brand to improve your employee value proposition Social recruiting is a great way to hire candidates and also attract talent. Obviously, startups might not be able to spend too much on marketing in its initial stages, so a good online presence is a perfect stepping stone to source the best talent. But large companies are also seeing the advantages of maintaining an online presence, compared to using traditional techniques. Talent brand is what employees and jobseekers think, feel, and share about a company as a place to work or be in. As recruitment has become more like marketing, companies are gradually embracing the concept of talent acquisition. 56% of global talent acquisition leaders say investing in a talent brand is the highest priority and the top competitive focus for their company, according to 2014 data from LinkedIn. For large multinational companies like GE, maintaining a uniform global presence is essential for strengthening a talent brand. Acquisition leaders’ actions need to catch up with the requirements of this strategic positioning. Companies can get ahead by investing in their talent brand and creating a proactive strategy to promote and measure it. Logically, the growing importance of social professional networks for recruitment makes them the preferred channels for promoting talent brand and designing an attractive employer value proposition (EVP). At the onset, this requires a targeted approach. In terms of content creation, GE’s Talent Acquisition Team mentions examples such as interesting and attentiongrabbing job postings, descriptions of the company, the culture, and the location, and “a day in the life of ” scenarios, among others. Knowing where to post content is even more important. For instance, the LinkedIn group MENAT Careers is currently GE’s most active talent-focused

3. Ongoing development is the key to employee retention On-boarding new hires must necessarily go beyond the traditional training and orientation drill to deliver on the company’s EVP as flawlessly as possible. Induction during the first week(s) should include a clear schedule of meetings with team members in different departments, as well as room for training, discussing goals, and providing feedback. This goes towards fostering an environment in which employees have a platform to openly discuss their career advancement and receive feedback on their performance and expectations. “An important thing I tell people to keep in mind is not getting caught up in the ‘band’ system. The new and evolved workplace is more of a ‘matrix’ where career advancement can be parallel too,” said O’Haire. To build such an environment, GE established GE Crotonville, the world’s first corporate university, in 1956. The university offers around 1,800 courses on-campus, in-region, and virtually, with over three quarters of its in-person courses delivered outside the US. “GE Crotonville is the backbone of our employee training and a key retention tool,” said O’Haire. The university offers a world-class program for career development and leadership. In 2013, GE Crotonville served close to 40,000 employees and 3,000 customers.

Daragh O’Haire is a Talent Recruitment subject matter expert. He is currently based in Dubai as Global Talent Recruitment Leader – MENAT. He has a total of 15 years recruitment experience across a multitude of industries (rail, construction, engineering, technology, healthcare, etc.) as well as in driving performance and delivery across the Middle East & Africa, Australasian and European markets. He combines both in-house and agency/ executive search consulting experience for a commercially driven focus backed by industry knowledge. social media channel, addressed mainly to the senior end of the market with 13,000 members. An official Facebook page will go live this year and will primarily target executive schools and universities. Building a talent brand means more than just reaching out to fill staffing needs. It involves cultivating relationships and building an ongoing dialog with online communities. GE’s new operating model places emphasis on agility, acceleration, and customer focus. To promote it, the company developed the “GE Beliefs” via internal crowdsourcing for the first time to usher in a high-integrity environment that employees want to see. This is not limited to online promotion, but also permeates the different steps of the recruitment process. During an interview, for example, candidates are evaluating the hiring manager, the recruiting officer, and the company. So there should be time during an interview to “sell” the company and its culture. It is also a chance to “court” candidates by offering them a site tour or a chance to socialize over lunch.

4. Retention should address short and long-term market needs The MENA region’s phenomenal growth makes it very attractive for good talents. In this environment, the challenge for recruiters is to stay ahead of the competition. “In such growth markets, customer focus is critical,” said O’Haire, so GE MENAT’s recruitment team is aware that it needs to develop strategies more culturally sensitive to the market. Seeking better job opportunities in such a fast-growing environment concerns both expats and local hires and is one of

Summer 2015 The QuarTerly

ENTREPRENEURSHIP

UsefUl Apps for TrAnsporTATion the main causes for non-retention, said O’Haire. For this reason, there is a pressing need to socially assimilate the expat workforce. In parallel, recruiters work on ensuring that talent is localized, i.e. more likely to stay and benefit local economies. “Our main agenda is to have a localized workforce whenever possible,” said O’Haire. This could start with a company posting on social media in the language of the country or region it is operating or recruiting in. Thanks to nationalization policies by governments in Saudi Arabia, Qatar, Oman and other GCC countries, workforce localization is slowly gaining ground in the region. In Saudi Arabia, for example, 45% of the GE team is localized. 5. Standardized processes save costs and streamline recruitment Due to their constraints on budget and

resources, startups obviously find online recruiting is far less expensive than using headhunting agencies or other more traditional recruitment methods. With a standardized process, startups can also develop best practices and streamline recruitment. What applies to startups must also apply to larger companies. These companies are increasingly realizing the importance of centralizing recruitment in-house within talent recruitment teams (centers of excellence), rather than relying on third-party recruitment agencies. Having a standardized recruitment process can help optimize the team’s service offering towards adopting best (and replicable) practices. Standardization and centralization works even for large companies like GE that are active in different sectors.

how brands, entrepreneurs, and eVerybody else get your

attention

book review: “Captivology” by ben parr

ow can startups get people’s attention? More importantly, how can they you keep it and convert people into customers, investors, and brand ambassadors? Award-winning writer and marketing agitator Ben Parr (DominateFund, Mashable) spills the beans in his book, Captivology, The Science of Capturing People’s Attention (HarperOne, March 2015).

This is where big data comes in and helps set up an applicant tracking system (ATS) database. For GE which operates different divisions for oil and gas, aviation, healthcare, etc., having recruiters specialized in these fields can help. However, O’Haire said they place more weight on recruiters’ time and exposure within the company, its different divisions, and the market it operates in. “You don’t need to be an expert in an industry, but you need to be an expert in recruitment,” he said. This means asking the right questions to hiring managers in order to understand the job requirements fully. The recruiters at GE then handle the entire scope of the process, from sourcing and screening candidates to conducting interviews, providing feedback and crafting the offer. This allows them to be as close to candidates as possible.n Ben Parr is the co-founder and Managing Partner of DominateFund, a strategic venture capital firm, as well as a columnist for Inc. He was named by Forbes one of their “30 Under 30”. Before that, he was Co-Editor and Editor-at-Large of Mashable, where he wrote over 2,400 articles on social media and technology.

Entrepreneurs Gotta Read This! As co-founder and managing partner of a venture capital firm, Parr noticed that entrepreneurs’ most pressing needs included knowing how to deal with the press, develop marketing campaigns, build viral products, optimize customer acquisition… i.e., getting people’s attention. Entrepreneurs will find Captivology invaluable: “In Silicon Valley, disruption is the mantra that entrepreneurs live by,” says Parr. But the lessons applicable to anyone in any context, from running for office to sitting for a job interview and even attracting a mate.

that trigger predictable and quantifiable responses in the mind. These tools are ideal for capturing attention, based on your communication purpose or goal: 1. Automaticity: Provoking people’s automatic reaction to certain stimuli 2. Framing: Adapting to/changing somebody’s perspective so they pay more attention to you 3. Disruption: Violating people’s expectations to shift their attention 4. Reward: Leveraging people’s motivations with rewards 5. Reputation: Using someone’s reputation to establish credibility and persuade audiences 6. Mystery: Creating suspense to keep audiences intrigued 7. Acknowledgement: Validating and understanding audiences to foster a deeper connection

The 7 Captivation Triggers Successful message delivery requires capturing your audience’s immediate, short, and long attention. Disruption captures people’s immediate attention – like the word “captivology”. Short attention requires something unique, novel, and useful to stay focused. Finally, long attention requires content memorability. Parr identifies 7 psychological and scientific phenomena

More Reasons to Read Every page is filled with research and anecdotes, including conversations between Parr and captivators such as Facebook’s Sheryl Sandberg or Shigeru Miyamoto, the creator of Nintendo’s Mario. Just as The Simpsons movie feels like a long TV episode, Parr’s first book (after writing thousands of articles) reads like one long and interesting blog post.

The QuarTerly Summer 2015

ENTREPRENEURSHIP

UsefUl Apps for Tr nsporTATion A Round-Up of Taxi-Booking Apps for Residents in MENA

new Middle east startups that should be on your radar By Wael Nabbout | @FulMtlColumnist

ith more startups springing up across the MENA region, it’s getting harder to keeping up with the most promising startups around. To help you get the most innovative startups on your radar, we have compiled a list of 10 startups that you should keep an eye on…

Kicking off the list is EstateUp, an equity-based crowd investment

The QuarTerly Summer 2015

platform in the Middle East focused on the real estate market. The company offers individuals the opportunity to back developers and invest in real estate projects, something which is normally impossible due to the high entry capital required. The company launched in February, and hopes to capitalize on the property boom that is expected as we get closer to Expo 2020. “In terms of investors in the UAE alone, our target market is the B&C sector (21.5%) and the high net worth individuals (4.7%),” according to co-founder Aakarshan Kathuria. For now the company will focus on the UAE, before moving on to other GCC countries in the near future. While real-estate equity crowdfunding is novel in the region, the idea has already been applied successfully outside of the MENA

with examples including Fundrise, RealtyMogul, and CrowdStreet. Country of origin: UAE Date of launch: February 2015 Category: Real estate

Another startup to come out of the UAE is LoadMe, the first and only online marketplace for transporters in

CafeTunes is a web and mobile app that lets you control music at public places, namely cafés, based out of Iran. Originally, the service offered a listing of the music that was being played at various cafés in Tehran, but the three founders eventually pivoted their product into a vote-based request system. The music map is still there too, which means that individuals can use it to find places that are frequented by people with similar tastes as well. The company recently joined a six months seed stage digital accelerator program called Avatech where they received a 25 million toman seed fund, which is equivalent to about $8800. Country of origin: Iran Date of launch: 2014 Category: Music

the Middle East. The service launched in beta early in the year and had its full launch in April. The concept is a proven service outside of the region and is known as a load board, an online matching system that allows shippers and freight brokers to post loads. “In Middle East, the logistics industry has witnessed double digit growth in the past few years and according to Frost & Sullivan, in 2015, our first year of activity, the logistics market in GCC is valued at $35 billion, out of which the land transportation accounts for $7 billion. This is the market that LoadMe is targeting directly,” explains cofounder Sebastian Stefan. Country of origin: UAE Date of launch: April 2015 Category: Logistics

Magnitt is a UAE-based online platform that brings together entrepreneurs, investors, mentors and potential business partners together. Best described as a pitching platform, the service allows aspiring entrepreneurs to pitch their ideas onto the platform where it would get reviewed by the other members. And so, interested investors, mentors, entrepreneurs or professionals alike can easily get in contact and join the endeavor. The focus of the service is purely on connecting people. Anyone can sign up at no charge and browse or post ideas. Entrepreneurs get to see what each investor is willing to offer

them, and if they wish to connect with their chosen investors, they pay a small fee that ranges between $25 and $100, depending on the package chosen. The company recently joined the Dubai-based Google-partnered tech hub AstroLabs. As of March 2015, and just a few weeks after launch, the service received over 200 registered members. Country of origin: UAE Date of launch: Early 2015 Category: Social platform

Similar to Warby Parker’s home-try-on program, Mr Draper offers an online grooming service for men where they can discuss their look with a stylist, who then sends a number of personalized outfits right to their houses. Customers can then try the outfits on for up to 5 days, keep what they like, and return any items that they don’t desire. They give online feedback on all the items they received, with the information used to create better personalized future packages. The company was launched almost a year ago by Syrian-American Mahmoud Gao and his business partners Tiba Al Damen and Mary Freij in Silicon Oasis. They buy wholesale and sell straight to consumers which means they don’t incur any rent. By March 2015, almost 2,500 people have signed up for the service, and the company sent more than 2,000 boxes of clothes to Dubai, Abu Dhabi, Sharjah, and Ras Al Khaimah. The company expects first-year revenues of about Dh1.5 million (~400K USD). Today, more startups are looking into the online fashion space. Just last March, one of the Ideathon contestants at ArabNet pitched TopShou, a fashion styling app aimed at women. Country of origin: UAE Date of launch: Mid- 2014 Category: e-Fashion

Summer 2015 The QuarTerly

ENTREPRENEURSHIP

UsefUl Apps for TrAnsporTATion customers a large variety of items at low

reminiscent of AirBnb, but the essence

focus on Saudi Arabia and the UAE. The company joined Oasis500 and graduated on at the end of 2014. Country of origin: Jordan Date of launch: End 2014 Category: E-commerce

former, homeowners on Voyaj share their homes and spent time together with the visitors. Building relationships is at the heart of the service. It is AirBnb with a soul. El Baggari received a $60,000 Seed Funding Award from her college to launch the project. The company has also generated about $30,000 in revenue from about 120 people that have connected on the platform. The service is currently only available on the web, but the Android and iOS version will soon follow. Country of origin: Morroco Date of launch: October 2014 Category: Accomodation

shipping rates. Initially, the company will in MENA of the services are far apart. Unlike the A Round-Up of Taxi-Booking Apps for Residents

While there is a number of e-education platforms currently operational in the Middle East - Edraak, Rwaq, MENAVERSITY - a new Saudibased platform is looking to cater for the education sector from another angle. Meshlytics is an early stage venture that develops custom solutions for educational institutions to better engage and manage their alumni. The company’s first product, called Intouch, is a white label alumni relationship management platform and mobile engagement application. The service collects and analyzes alumni data and in return provides insights to institutions. Administrators receive all the updated information on graduates, including full statistics on the sectors in which they work as well as their positions. Graduates can interact on the platform as well. Meshlytics currently relies on self-funding to expand the platform and is generating revenue through an annual subscription fee paid by the beneficiary institutions. To date, it has successfully launched the platform at two universities and has several new deals in the pipeline. The main challenge the team faces is related to the slow-decision making at universities in the region. Country of origin: KSA Date of launch: July 2014 Category: Education

Your online source for all things equestrian in the Middle East is without a doubt Stal Arabia, an online tack shop based out in Amman. The price of equestrian supplies are usually high, mainly due to the scarcity of both online and offline tack shops serving the region. Stal Arabia hopes to fix that and offers

The QuarTerly Summer 2015

Indiepush is an online indie music platform based out of Ramallah. It is not the only Middle Eastern platform focused on indie music in the region - think Sawt and Mideast Tunes - but it certainly is unique, with two distinct features. As its name suggests, it offers indie musicians a channel of distribution ‘through their fans.’ This means that fans are encouraged to market the band to friends and family in exchange for rewards. The platform utilizes a point based system. Shares earn you points; points buy you songs. Even though it has been Beta for just a couple of months, the platform has already featured more than 50 indie artists. Country of origin: Palestine Date of launch: 2015 Category: Music

Our penultimate pick has already been featured on the Huffington Post and National Geographic. Voyaj, a handy service for travelers that was dreamt up by Moroccan entrepreneur and world culture enthusiast Yasmine El Baggari, connects and matches travelers and hosts from around the world and provides them with authentic cultural experiences. The concept is

Last in our list, but definitely not least, is Shezlong, an online platform for professional and licensed psychotherapists. In the Middle East, 48 million individuals suffer from mental disorders, and Egypt alone accounts for more than 23 million. To make things worse, these individuals have to carry the social stigma that comes with undergoing therapy. This is why Shezlong is offering secure, anonymous and affordable channel for psychotherapy. There are currently 5 doctors on board, each serving 20 time slots per week. Since launch, the service has had about 5000 visits and 50 reserved sessions. Similar to Shezlong is Palestinian-based Fadfid.com. In fact, online patient-doctor interaction platforms are plentiful in the region. What’s more, they hold great appeal for investors. Dash ventures and MEVP’s investment in Al Tibbi and Sadara’s investment in Webteb to name a few, and eTobb was recently admitted to Mountain View’s 500 Startups. Country of origin: Egypt Date of launch: February 2015 Category: Health

ENTREPRENEURSHIP

UsefUl Apps for TrAnsporTATion A Round-Up of Taxi-Booking Apps for Residents in MENA

By Nina Curley | @9aa

“D

on’t [mess] up the culture!” Oscar Kneppers of Amsterdam-based startup accelerator Rockstart told me this January, when I was there for a leadership program. “You have to make it fun to do what you’re doing.” In a black t-shirt, jeans, a shock of blond hair, and a leathery tan, Kneppers looks like a metal guitarist turned marathoner. Even as he’s speaking about failure, the twinkle in his eye never goes out. Many founders launch their companies with that kind of twinkle. But it can fade over time, as the company scales

The QuarTerly Summer 2015

and culture grows more bureaucratic, or as time erodes the excitement that everyone felt in the early days. Ever since that conversation, I’ve been pondering how we can encourage our companies at Flat6Labs Abu Dhabi—and our program itself—to build and maintain that spark? How can we bottle and maintain the thrill of building something new? How can we support entrepreneurs that build not only companies, but sustainable cultures as well? In the early days, the company culture is determined directly by the founders—not just their philosophies, but

the spirit and ethics that they embody; it’s impossible to separate the two. As far as many investors are concerned, the values that founders embody are far more important than the statements they write on their walls. “Personally, I’m not a fan of prescribed mission and vision statements,” says Khaled Talhouni of Wamda Capital. “The objective and spirit of the business should be evident in the culture and approach of the founders.” To garner the attention of Salem Al Noaimi, an experienced angel investor,

startup enthusiast, and the CEO at Waha Capital, a founder should be: “Passionate. Totally engrossed in what he or she is doing. Hungry. Committed. Pragmatic and practical but super ambitious. Real. Disciplined, focused, but unrestricted in breadth of thinking, i.e. with an ‘open framework’ mind. He or she must have in-depth knowledge of his/her space, but also able to see big picture.” This may sound like a lot to ask, but it isn’t—you’d be hard pressed to point to a successful founder who didn’t begin with many of those qualities. The elements Al Noaimi describes come down to three critical components: intrinsic motivation, deep knowledge, and vision. To get Khaled Talhouni of Wamda interested, a founder has to forget “prescribed mission and vision statements,” he says. “The objective and spirit of the business should be evident in the culture and approach of the founders.” It may be easy to maintain those qualities in the early days of a company’s culture, when the founders have a lot of influence. But as a company scales and grows over time, how can good founders translate that motivation, knowledge, and vision into a truly effective culture?

1. Define a mission that communicates deeper beliefs

If you don’t know why you do what you do, why build a culture at all? As Simon Sinek famously pointed out, “People don’t buy what you do; they buy why you do it.” His TED talk (for the few who haven’t seen it) beautifully illustrates the principle of communicating, as he says, “from the inside out.” One example he gives: Apple has converted a generation of technologists into devotees by leading with inspiring beliefs. His version of their pitch: “Everything we do, we believe in challenging the status quo. We believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use and user friendly. We just happen to make great computers. Want to buy one?” In the Middle East, a belief-driven mission statement is more rare. A quick poll of some of the region’s largest and most swiftly growing digital companies reveals a variety of approaches:

Nina Curley is the Managing Director of Flat6Labs Abu Dhabi, a tech startup accelerator launched in partnership with twofour54 and focused on digital media. She is also the cofounder of Woman Up, an initiative designed to support women in entrepreneurship and business, and she is a participant in the THNK School of Creative Leadership. Previously, she served as the Editorin-Chief at Wamda, where she first discovered how much she loves talking to startup founders and changemakers and illuminating their journeys. Souq: The favorite shopping destination across the Arab World. Aramex: To enable and facilitate regional and global trade and commerce responsibly. Careem: To simplify and improve the lives of people, and build an awesome organization that inspires. Uber: Transportation as reliable as running water, everywhere for everyone. Shahiya: Make a cook’s search for good recipes and daily cooking experience the easiest and smoothest possible. Talabat: Become the leading online food delivery provider in the Middle East.

Yemeksepeti: To revolutionize the way people order food in the most convenient, time efficient, and enjoyable way. Is a deeply inspiring belief-driven mission crucial to company growth? No. But none of these companies have scaled without aligning around a real market problem. “We never wrote this as our ‘official’ mission statement, but it guided

every action and direction we took from day one,” says Hala Labaki, the founder of recipe portal Shahiya, which was acquired by Japanese company Cookpad last year. Startups may not “have the time and luxury to write ‘elaborate’ mission statements,” she says, but “they should clearly identify, early on, the problem they are solving and why their solution is better than anyone else’s.” Careem’s Christian Eid, who formerly ran Rocket Internet’s Easy Taxi in Saudi Arabia, has learned the value of a mission the hard way. “Easy Taxi didn’t have [a mission] to my knowledge and that could have ultimately been a contributor to its lack of purpose and drive,” he says. “A mission provides the foundation that retains the fuel for continued perseverance. It has to be both challenging and simple.” For full service digital agency LMTD, this process is essential for determining the future. “We’re at a medium term stage, and we need a longer term strategy,” says Director of Operations Matt Eibling. “There’s no way to do that without first establishing a mission and values. [Otherwise,] you can’t define how you’re going to contribute and how your business is going to contribute to the world around you. It’s like walking without glasses; maybe you’re just walking in a direction because it’s the easiest path to take at the time.” We’ve decided to put on the glasses on and define a mission and vision as guiding principles to determine the decisions we make over the next year.”

2. Set values that motivate your employees

Simply defining a focus, and even a set of beliefs, is not enough; founders that want to build a motivating culture have to do two things: cultivate motivating values and tie those values directly to their company’s objectives. What are motivating values? To motivate innovative employees, a company must cultivate three things, says author Dan Pink: autonomy (the urge to direct our lives), mastery (the desire to get better and better at something that matters), and purpose (yearning to do what we do in the service of something larger than ourselves).

Summer 2015 The QuarTerly

ENTREPRENEURSHIP

UsefUl Apps for TrAnsporTATion

Without working in a company that supports these values, employees will lose the kind of intrinsic, self-directed motivation that allows them to be truly productive.

it,” she says. “This was done by creating

we are running against a clock and we all have a role to play in making our world more sustainable.”

task—productivity doesn’t necessarily mean being intrinsically motivated all of the time.

Autonomy: Creating a sense of autonomy while retaining company alignment is no small feat. The more that company’s management can define and track results, the less they will need to micromanage employees’ time. Companies can also actively encourage time spent on other projects—Google’s 20 percent time and Atlassian’s “FedEx Days” (i.e. build and ship something) being famous examples. However, this can be a double-edged sword in the early days since encouraging autonomy in fact involves a lot of diligence when it comes to process;we have all met at least one startup that went too far with creative time without tracking metrics well, and could not maintain efficiency.

3. Hire and support selfmotivated employees

Second, focus on learning instead of performance. Over decades of work, Stanford psychologist Carol Dweck has shown that people can achieve more, and overcome failure more easily, if they believe that ability is something malleable to be learned and developed, not a fixed quantity that can only be demonstrated. Dweck’s work has also shown that praising innate intelligence over learned effort can sap motivation. Writer Malcolm Gladwell has referenced that finding to argue that this myth of innate talent is what brought down energy giant Enron and has prevented management consulting firm McKinsey from being more innovative. Yet by focusing on learning, championing a growth mindset, and encouraging belief in change, Dweck’s work shows that leaders can help people overcome a fixed mindset, improve their intelligence, and thrive.

Knowing the difference can help your

company hire the right employee for the A Round-Up of Taxi-Booking for Residents in MENA a senseApps of urgency around the fact that

Mastery: To encourage a sense of mastery, it helps to champion it openly. Dan Stuart and Sohrab Jahanbani, the cofounders of Dubai-based daily deals site GoNabit, which sold to LivingSocial in 2011, did so by defining a value—“Be the CEO of something”—and then rewarding the employees that best exemplified that value each month. The two cofounders thought that it was so important to support mastery that they kept the same value in their UK-based service provider marketplace, Bidvine. “We’re both deeply committed to it as a value,” says Jahanbani. “Being the CEO of something means that we expect people to take something, make it their own, and run with it.” Purpose: Helping people connect to a sense of service and purpose beyond themselves drives the deepest motivation, Pink says. Dina Sherif, the founder of Ahead of the Curve, a social business dedicated to building sustainable societies by focusing on the intersection between the private sector and sustainable inclusive growth, has found purpose to be essential to its team. “We have built a team of people who are not dedicate to Ahead of the Cure as a company but who are dedicated to the purpose behind

The QuarTerly Summer 2015

The final challenge in building a motivating culture is hiring the right employees. Research has shown

that employees who are extrinsically motivated, meaning that they are motivated by their salary and physical rewards—whether by nature or due to experience—actually do not become more productive in a culture designed to encourage self-determination. In other words, your company’s culture can’t turn a worker bee into a creative butterfly. But you can try a few tactics to optimize productivity: First, know which kind of incentive you need for the task. Studies have shown, Pink illustrates, that when it comes to rote, menial tasks, workers of all stripes are more encouraged by monetary rewards or contingent prizes (extrinsic rewards), which motivate them to find the most expedient solution, not the most creative.

Finally, a company can aim to hire self-motivated employees who already have a growth mindset. Ah, if only it were so easy. What does a growth mindset look like? At Flat6Labs Abu Dhabi, I hired our Program Manager Ramzy Ismail because he queried my values and my vision for the culture. I wanted to hire a warrior, and I knew right away that I had found one focused on growth at all costs. When it came to hiring our Office Manager, I had several discouraging interviews until I met a woman who answered the standard question, “Why did you come to Abu Dhabi?” with a cheerful: “Actually, I wanted to cultivate a more independent life for myself.” Her competence with numbers and passion for the work was her selling point, but her selfdetermination got her the job. These are early days—we and our startups have a long way to go—but every decision counts. Don’t screw up the culture.n

inside covers.indd 2

5/20/15 8:11 PM