In It to Win It

FOUR AREAS entrepreneurs need to address to ensure the success of their startups

by ABBAS BERDI

SECURING VENTURE CAPITAL is an essential catalyst in an entrepreneur’s journey. It has a key role to play in the development of successful, sustainable startups that are looking to transform innovative ideas into real-world solutions. But it isn’t easy.

In the Middle East, the attitudes of investors are changing when it comes to the startups they wish to support. Venture capitalists (VCs) are no longer playing it safe with later-stage companies where the concept is proven, and momentum already gained. Instead, the appetite is increasing for riskier inception and early-stage investment, as they view this as key to ensuring the most innovative, transformative ideas can develop into flourishing enterprises.

At the same time, regional investors are becoming more sophisticated. They have a keen eye for what pre-requisites de-risk early-stage business, and what is likely to drive value in the long term. Regional corporates and large private companies are increasingly taking risks, with Al Tayyar Travel Group, Wamda Capital, and Majid Al Futtaim Group among those who have supported startups championing the most innovative ideas in recent years.

These factors afford exciting opportunities for new businesses. But while the appetite for investing in startups has never been higher in the Middle East, competition for access to that capital has also skyrocketed. Venture capital firms are inundated with requests for funding. Indeed, they can receive as many as 5,000 startup pitch decks a year, but less than 1% will secure finance. And while it’s easy to focus on the financial aspects of a business plan to secure investment, there are other key areas that are often overlooked. }}