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ISSUE 130 MONTHLY FOCUS: TECHNOLOGY SECTOR
34 The rise of digital India and the opportunities it presents. 46 Top technology predictions. 90 How Thea Myhrvold’s growing enterprise is making a difference.
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BLOCK YOUR DIARIES NOW and come to the edge
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SME Advisor Middle East is aimed at business owners and senior executives across the GCC. Armed with practical advice, it has been highlighting key business issues for the small and medium enterprise segment since its launch in 2005. The magazine addresses real issues faced by business decision makers, without resorting to jargon. We understand that often, in small and medium enterprises, specialist business decisions are made by the owners and not by an army of c-level executives. At the same time, our content is equally relevant and useful for specialist, senior executives in mid-level enterprises. The magazine style is consumer, conversational and colourful.
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From the web
Dubai SME partners with Global Village With its 21st season soon approaching, Dubai’s multi-cultural festival park has joined hands with Dubai SME to provide a platform to Emirati entrepreneurs to showcase their talent. Saeed-Al-Marri, Deputy CEO of Dubai SME, said: “Global Village is one of the main strategic partners of the Mohammed bin Rashid Establishment for SME Development. It has always strived towards providing the organisation and the SME owners with their continuous support. Global Village provides startups, and those interested in developing their projects, the ideal platform.”
For further information, please visit: www.globalvillage.ae
Souq.com unveils its new initiative The online retail and marketplace platform launched a program called ‘Fulfilled by Souq’ that will offer a range of benefits to buyers and sellers on the platform. The initiative empowers sellers to save time, boost their sales and grow their business without having to worry about logistics, whereas consumers can enjoy a superior shopping experience with high quality guaranteed products with fast and prioritised delivery at their doorsteps. Wisam Daoud, COO, Souq.com, said: “Our primary objective is to deliver the highest quality products as quickly and efficiently as possible to our customers.”
To read more about please visit: http://uae.souq.com/ae-en
Smart Dubai launches DubaiNow Published By: CPI Business FZ LLC Office 111, Building 4 Dubai Media City Dubai, United Arab Emirates
Contact Details: Tel: +971 4 433 2446 Email: info@cpibusiness.net Web: www.cpibusiness.net
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© Copyright 2016 CPI Business. All rights reserved. While the publishers have made every effort to ensure the accuracy of all information in this magazine, they will not be held responsible for any errors therein.
Her Excellency Dr. Aisha Bin Bishr, Director General of Smart Dubai Office, said: “The DubaiNow platform is a powerful example of what we can accomplish, for the happiness of our people, when we work together as government departments and the private sector. By providing a unified window to Dubai city services through DubaiNow, we are making city experiences more seamless and impactful for our residents. And with a shared data enabling services for identification and payments, we are creating a more efficient and secure city. The Dubai Now web portal, as the next evolution in the DubaiNow platform, further enhances our ongoing efforts to achieve the vision of His Highness Sheikh Mohammed Bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, to make Dubai the happiest city on earth: With technology as our tool, happiness becomes the goal. “
To read more about please visit: www.smartdubai.ae
Editor’s Note
Being an entrepreneur For nearly a decade now, we’ve celebrated entrepreneurs, business owners, researchers, creative geniuses and artists across our various mediums – online, print and events. Our goal has been to introduce you to innovative business models, ground-breaking ideas, promising technologies – mixed with practical, grounded advice about running your business. But, we often get asked: what is the basis for selection? Is there a specific set of criteria that one needs to meet to make it to the cover? Are you going judge our ability based on pre-set metrics? RUSHIKA BHATIA EDITOR
Here’s a handy infographic to guide you through –
58 - ExpoFreight (EFL)
Of course not! And, that’s because there isn’t a set formula to achieving entrepreneurial success. It’s not “Do these five things and you’ll be the next SME hero”. Entrepreneurship, as we’ve discovered, is the very process of experimenting, trying different things, rehashing, tweaking – finding the weirdest and most unconventional routes to getting the job done. Every day is a challenge, every deal is a risk and every step is filled with uncertainty. And, the only way to truly achieve success is to continue on the journey and have the belief that – come what may – you can do it. Every entrepreneur we’ve ever come across has their own style. Yes, there’s no doubt that there are certain characteristics such as ambition, perseverance, hard work that are common to all. But, each one has a story unique to them. We come across many such extraordinary stories every month and are truly mesmerised by the difference they are making to the world. The ones that ultimately make it to our print edition are the ones that have the most intriguing combination of work, character, lifestyle and culture. They are the unsung heroes that don’t get talked about and have so much to say! This month’s issue features nine such stories in the technology industry. They are: Instashop, Exponent, PeopleFirst, Awery Aviation, Pixelbug, ZeenTV, Hoodi, ExpoFreight and Teachmenow. Their experiences and challenges hold lessons for many business owners. Enjoy reading this issue of SME Advisor!
62 - InstaShop
66 - Exponent
70 - PeopleFirst
74 - Awery Aviation
78 - Pixelbug
82 - ZeenTV
86 - Hoodi
90 - Teachmenow
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Contents
The economist’s view 028/ Man vs.Machine 034/ The rise of Digital India 040/ How technology is disrupting transportation
Infographic of the month 046/ Top technology predictions
SME Beyond Borders 048/ A snapshot of the day’s powerful agenda
Business banking 054/ Fostering the manufacturing sector
Digitally disruptive 058/ Logistics simplified
034/
BIGGER START-UPS ARE GOING FOR INTERNATIONAL EXPANSION BY ACQUIRING SMALLER PLAYERS IN FOREIGN MARKETS Top change makers 062/ Reinventing retail 066/ View from the top 070/ Cultivating culture in an IT firm 074/ Flying high 078/ A pixel is worth a thousand words 082/ Cracking the screen: the new age of video 086/ Your friendly neighbourhood app
058/
SINCE ‘SERVICE’ IS A FUNDAMENTAL PART OF OUR COMPANY ETHOS, IT WAS SIGNIFICANT THAT WE PARTNERED WITH SOMEONE THAT COULD HELP US COMMUNICATE MORE EFFECTIVELY WITH OUR CLIENTS.
Making a difference 090/ A global company with a regional success story
Organisation & structure 094/ Top tips on cloud computing 098/ Profiting from the cloud 104/ Lost in the cloud 106/ Your digital checklist 110/ The growing threat of cyber risk
Looking to the future 114/ Artificial intelligence – the future is here
Disruptive invention 118/ What a spectacle!
The fiercely ambitious Thea Myhrvold, Founder and CEO, of teachmenow.com, tells us how she did it all
28
90 78
Dany I. El Eid, Founder, Pixelbug, is taking his ground breaking concept to the Dubai Future Accelerators Programme.
What does automation mean for the future of jobs?
66
Asam Khan changed the way the steel industry tracks and monitors its inventory forever when he launched Exponent. Savita Raina of SAP puts together a checklist that covers all aspects of digitalisation.
106 62 For all the people that absolutely dread their weekly grocery shopping trips or simply can’t find time for it in their busy schedules, InstaShop comes to the rescue.
C O N T E N T C U R ATO R S 026
CONTENT CURATORS Presenting this month’s portfolio of industry specialists and thought leaders, who played a critical role in producing the feature content of our magazine and ensuring that we were more topical than ever.
““ ASAM KHAN COO EXPONENT
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JAMES BESSEN BOSTON UNIVERSITY
While automation does not appear to have a major effect on overall employment, automation is associated with substantial job losses for some groups of occupations and job gains for other occupations.
The industry will be heading into a maturity stage as commercial operations begin to see wide-scale adoption of the technology, driven mostly by a more defined regulatory environment.
C O N T E N T C U R ATO R S 027
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There is lots of momentum around the AR & VR space at the moment, particularly with the recent rise of Pokemon Go that has helped in bringing the technology into mass consciousness.
DANY EL EID FOUNDER PIXELBUG
““ ROB COTTON CEO NCC GROUP
The overarching problem with IoT is that many embedded devices were developed as standalone units, with no intention of one day being connected to the Internet or other networks, and often do not employ the same security practices as a connected system would have.”
““ HESHAM EL KOMY SENIOR DIRECTOR EPICOR SOFTWARE
Moving to a cloud-based system gives everyone the real-time system access they require as a routine part of their jobs, while driving out the inefficiency of paper-based processes and the burden and security risk of figuring out how to deliver this yourself.”
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MAN VS. MACHINE
Experts have always depicted a future populated by robot employees and automated workflows. Yes, that will increase business output. And yes, it will boost efficiency. But, what does that mean for the future of jobs? James Bessen of Boston University - in collaboration with VOXEU - does some data crunching and shares his analysis‌
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EDITOR’S PICKS 01. The evidence suggests that while computers are not causing net job losses now, low wage occupations are losing jobs, likely contributing to economic inequality. 02. With automation, machines perform part or all of an occupational task, reducing or eliminating the human labour needed to perform that task.
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A
utomation has become a concern not just for blue-collar manufacturing workers, but also for white-collar workers and even professionals. New computer programs, some using artificial intelligence, are taking over the tasks of bookkeepers, bank tellers, clerks, and others (Brynjolfsson and McAfee 2014). Some see this replacement causing technological unemployment and a slow recovery from the Great Recession (Ford 2015). Looking forward, Frey and Osborne (2013) project that “47 per cent of total US employment is…potentially automatable over...perhaps a decade or two.” While others see a more modest impact (Autor 2015, Arntz et al. 2016), the view that computer automation has been causing and will increasingly generate major unemployment
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The story is not about machines replacing humans; rather it is one of humans using machines to replace other humans.
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Figure 1. Fulltime-equivalent bank tellers and installed ATM machines in the US
500
Tellers, ATMs (1000s)
400 300 200 100 0 1970 Source: VOXEU
1980
1990
Fulltime equivalent workers
has prompted calls for new policies such as a minimum basic income (Ford 2015). But has computer automation actually been generating a large net loss of jobs? Unfortunately, much of the popular discussion of automation has not benefited from either rigorous economic analysis or empirical evidence. A recent paper estimates the effects of recent computer automation on employment growth in detailed occupations in the US (Bessen 2016); this is done using a model that captures basic economic interactions that have largely been ignored in the popular discussion, such as the effect of automation on product demand and on inter-occupation substitution.
2000
2010
+ ATMs
Basic economics of automation It is important to begin with a clear understanding of what automation is and how it affects jobs. With automation, machines perform part or all of an occupational task, reducing or eliminating the human labour needed to perform that task. But this is not the only way that new technology can disrupt the workforce. New technology can make products obsolete. For example, the automobile eliminated jobs for carriage makers, although it also created jobs for auto-body makers. Technology can also change work organisation. For example, communication technologies facilitate decentralisation, outsourcing, and
offshoring, shifting work from one group of workers to another. Self-service technologies (e.g. the airline ticket kiosk) shift work to consumers. Information technology can facilitate new markets (e.g. Airbnb, Uber). Although all of these other sorts of technological change can be disruptive and eliminate jobs for some workers, there is no particular reason to expect them to create large job losses overall; new jobs are created while old ones are eliminated. Automation, on the other hand, might cause net job losses because machines reduce the human labour needed to produce a unit of output. Also, much of the discussion concerns human jobs being completely taken over by machines (e.g. Frey and Osborne 2013). But in fact, most automation is partial – only some tasks are automated. For example, despite extensive automation since 1950, it appears that only one of the 270 detailed occupations listed in the 1950 Census was eliminated thanks to automation – elevator operators. Many others, however, were partially automated. This distinction is important because it implies very different economic outcomes. If a job is completely automated, then automation necessarily reduces employment. But if a job is only partially automated, employment might actually increase. This is true even if the job is mostly automated. The reason has to do with basic economics. For example, during the 19th century, 98 per cent of the SME ADVISOR
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The notion that computer automation necessarily leads to major job losses ignores the dynamic economic response to automation, a response that involves both changing demand and inter-occupation substitution.
labour required to weave a yard of cloth was automated, yet the number of weaving jobs actually increased (Bessen 2015). Automation drove the price of cloth down, increasing the highly elastic demand, resulting in net job growth despite the labour saving technology. Similar demand responses are seen with computer automation. Consider, for example, the effect of the automated teller machine (ATM) on bank tellers. The number of fulltimeequivalent bank tellers has grown since ATMs were widely deployed during the late 1990s and early 2000s (see Figure 1). Why didn’t employment fall? Because the ATM allowed banks to operate branch offices at lower cost; this prompted them to open many more branches (their demand was elastic), offsetting the erstwhile loss in teller jobs (Bessen 2016). Of course, partial automation can also decrease employment in an occupation. If demand is inelastic, then growth in demand SME ADVISOR
will not offset job losses. Also, automation can lead to substitution of one occupation for another within firms and industries. For example, there are fewer telephone operators now, but more receptionists; there are fewer typesetters, but more graphic designers, and desktop publishers. Graphic designers using computers became more productive than typesetters, so automation facilitated the shift of work from typesetters to graphic designers. Estimates of employment demand growth Taking these considerations into account, I estimate a simple model of occupational demand across industries that allows for changing demand and inter-occupation substitution within industries. As my key independent variable, I measure the extent of computer use by workers in each occupation and industry. These data come
from supplements to the Current Population Survey. I assume that occupations that use more computers will have a higher degree of task automation, all else equal. The dependent variable is the relative growth of employment in occupation-industry cells. The estimates contradict popular assumptions about the impact of computer automation. First, computer-using occupations tend to grow faster, not slower. At the sample mean, computer use is associated with a 1.7 per cent increase in occupational employment per year. In other words, the bank teller example may be typical rather than exceptional. Second, there is a strong substitution effect between occupations. Occupations tend to have declining growth to the extent that other occupations in the same industry use computers. That is, the story is not about machines replacing humans; rather it is one
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Figure 2. Net effect of computer automation on occupation job growth, grouped by 1980 mean occupational wage
of humans using machines to replace other humans, as graphic designers with computers replaced typesetters. The substitution effect largely offsets the growth effect. Counting both, at the sample mean, computer use is associated with positive employment growth but the effect is small, 0.45 per cent per year. This association is not necessarily causal – perhaps some other factor caused computer-using occupations to grow. But this finding does show that computer automation is not associated with major job losses. Computer automation and inequality Nevertheless, computer automation is associated with major workforce dislocation. While automation does not appear to have a major effect on overall employment, automation is associated with substantial job losses for some groups of occupations and job gains for other occupations. In particular, low-wage occupations tend to lose jobs while high-wage occupations gain (see Figure 2). High-wage occupations use computers more intensively, allowing them to substitute for work done by low-wage occupations. This disparity could contribute substantially to economic inequality if workers in low wage occupations cannot easily transfer to high wage occupations. Low-wage workers, for instance, might not get opportunities to work with computers or might not have the necessary skills. Data provides some evidence that this might be the case. Occupations that use computers more heavily have had growing dispersion of withinoccupation wages—workers who acquire new skills earn more, but not all workers have the opportunity or ability to learn. Also, computer-using occupations tend to employ increasing shares of college educated workers, even in occupations such as bank teller that do not require college degrees. The verdict Computers automating tasks doesn’t imply that occupations that use computers
2%
1%
0% Low wage
Mid wage
High wage
Source: VOXEU
will necessarily suffer job losses. In fact, computer-using occupations have had greater job growth to date. Instead, it is the occupations that use few computers that appear to suffer computer-related job losses. The notion that computer automation necessarily leads to major job losses ignores the dynamic economic response to automation, a response that involves both changing demand and inter-occupation substitution. Of course, the recent experience does not necessarily predict the future and new artificial intelligence technologies might have a different effect. Indeed, even though past technologies, such as automated weaving, initially created many jobs, demand elasticity eventually declined, and then further technological gains led to job losses. Computer automation may create job losses in the future. But focusing on that future problem is a poor guide for today’s policy. The evidence suggests that while computers are not causing net job losses now, low wage occupations are losing jobs, likely contributing to economic inequality. These
workers need new skills in order to transition to new, well-paying jobs. Developing a workforce with the skills to use new technologies is the real challenge posed by computer automation.
References Arntz, M, T Gregory and U Zierahn (2016) “The risk of automation for jobs in OECD countries: A comparative analysis”, OECD Social, Employment and Migration Working Papers, No 189, OECD Publishing, Paris: Autor, D H (2015) "Why are there still so many jobs? The history and future of workplace automation", The Journal of Economic Perspectives, 29(3): 3-30; Bessen, J (2015) Learning by Doing: The Real Connection Between Innovation, Wages, and Wealth, Yale University Press; Bessen, J (2016) "How computer automation affects occupations: Technology, jobs, and skills", Boston University School of Law, Law and Economics Research Paper 15-49; Brynjolfsson, E and A McAfee (2014) The Second Machine Age: Work, Progress, And Prosperity In A Time Of Brilliant Technologies, New York: WW Norton & Company; Ford, M (2015) Rise of the Robots: Technology and the Threat of a Jobless Future, New York: Basic Books; Frey, C B and M A Osborne (2013) "The future of employment: How susceptible are jobs to computerisation", Working Paper. SME ADVISOR
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THE RISE OF DIGITAL INDIA India is an exciting space for investing in digital startups. How can global and Indian corporates benefit from this growth story? Experts from AT Kearney share critical insights‌
India is a hotbed of digital start-ups, with even the most conservative estimates showing more than 4,000 players. As Prime Minister Narendra Modi’s government actively promotes the Digital India initiative to transform the country into a digitally empowered society and a knowledge economy, investment and growth in the digital space will surge ahead. The number of corporate venture capitalists (VCs) investing in start-ups has grown and will likely become more prevalent in the near future. As more VCs seek to benefit from this investment boom, start-ups will look for investors that can provide more than monetary support. In this article, we discuss how large investors can succeed in this booming start-up environment. The dominant industries are consumer technology, IT, financial technology (fintech), and healthcare. Consumer technology is the most active, particularly in e-commerce, with major start-ups such as Flipkart, Ola, and Zomato securing late-stage investments. IT is seeing growth with analytics, big data, and cloud services gaining traction. Fintech is seeing developments in personal finance,
lending, and financial investments, with product and price-discovery platforms and innovative crowdfunding start-ups coming up. Healthcare is dominated by the doctor search site Practo and others that offer access to medical experts, while online advisory and consultation in healthcare are nascent. Beyond these verticals are what we call enablers, mainly B2B start-ups that facilitate relationships between companies and their customers, including payment services firms such as Paytm and logistics providers such as Delhivery. Five major trends are having an impact on the success of digital start-up VCs: 1. The B2C space is getting crowded, but niche segments remain attractive. B2C firms have attracted significant investments, and some start-ups have already received follow-on funding. E-commerce is the biggest digital start-up segment, with three-quarters of all B2C investment. Enablers and fintech firms also look promising and are expected to grow. SME ADVISOR
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Bigger startups are going for international expansion by acquiring smaller players in foreign markets.
2. B2B investments are in the early stages, with many good opportunities. While investments today are skewed toward B2C startups, we believe the balance will shift toward B2B start-ups in coming years, as has happened in developed countries. Enablers such as B2B logistics providers are likely to play a big role given the rise in online retail start-ups that lack back-end infrastructure support. B2B analytics and big data companies will also benefit from the need to mine sales information and consumer behaviour data to support fast decision making. Moreover, revenues are low because of B2C discount-based models, which are more realistic in B2B. Hence, investors will get pulled toward the latter. 3. Start-ups are expanding vertically and horizontally in the home market. Companies are increasing their footprint from large metros to smaller towns and rural areas. Other players such as Urban Ladder are integrating vertically to provide onestop solutions. They are also moving
Firms have four choices for investment models
• Investment in similar sector
• Support in
High involvement (strategic)
INCUBATOR
DISRUPTOR
EXPERIMENTER
SPECULATOR
STRATEGIC INVOLVEMENT
management and operations Low involvement (financial)
Low
Source: A.T. Kearney analysis
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INVESTMENT RISK
• Maturity level of start-up • Sector synergy and market risk
High
into adjacent segments, offering larger portfolios of products and services to benefit from economies of scale. One example is cab-hailing app Ola’s move into food delivery. 4. Players with a head start are expanding globally by organic and inorganic means. Bigger start-ups are going for international expansion by acquiring smaller players in foreign markets. Zomato and Practo are examples of fast-growing start-ups in more than 15 countries. Expansion rates highlight growth opportunities for Indian start-ups. 5. Consolidation has begun in relatively mature sectors such as e-commerce, travel and food. Major start-ups such as Flipkart and foodpanda are acquiring competitors and suppliers as they seek front-end customer synergies, back-end technology synergies, new talent, and scale benefits in marketing, overheads, and logistics. Big Investors can benefit but must be careful Many investors are funding India’s digital ecosystem, but the presence of strategic investors—in particular, corporate VC funds— is limited. In the United States, more than onefifth of investors are corporate VCs. As more corporate VCs invest in India, they will need to align their tactics to succeed. Disruptive changes in technology continue to become more difficult to track, and the big conglomerates will need start-ups’ breadth and agility to better understand the market. In this fast-changing digital world, it is cheaper and less risky for the giant, less nimble players to fund a diverse set of emerging technologies and then acquire the fruitful ones later rather than develop the capability in-house. For a start-up, investment by corporate VCs is a signal that the market views it as stable. Corporates come with relevant technical
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Firms can invest in and grow start-ups using synergies from supporting technology expertise, manufacturing capabilities, distribution networks, and branding.
and business expertise to help scale and run the growing start-up. And in sectors such as pharma and telecom, where internal R&D is expensive and requires hiring talented people, corporate VCs can significantly reduce this investment cost and risk. Two moves can help corporates make wise investment decisions: Select the right investment archetype. To choose the ideal mix of start-ups from the country’s vast pool, corporates will need to evaluate their strategic interest, investment size with risk appetite, and operating model. Firms can invest in and grow start-ups using synergies from supporting technology expertise, manufacturing capabilities, distribution networks, and branding. Fund terms and size should consider diversification and follow-on financing. There are four different models for investment. The models differ in how much involvement
investors have in decision making and operations and the risk of investment. Decide the mode of entry. Within each of these four archetypes, a company can invest alone or co-invest with other companies or traditional investors. Co-investment is preferred when the firm wants to reduce exposure in one investment and fund multiple areas, as Flipkart and Tiger Global have done with Nestaway, a luxury rental homes start-up. This strategy also works if a company is new to a region or has limited experience in venture capital; a VC’s expertise in selecting the right investment portfolio would prove valuable. For example, SAP Ventures made its first few investments in the country in JustDial and iYogi, where it co-invested with Canaan Partners and Sequoia Capital. In many cases, coinvesting also reduces cost because of lowor no-fee structures.
When investing with other corporate VCs, both firms can empower start-ups in their own areas of expertise. For example, California-based Expect Labs received funding from Intel Capital, Samsung Venture Investment Corporation, and Telefónica Digital. Samsung will use the start-up’s context-based technology to enhance its smartphones and Telefónica to improve its communication applications. Some corporates also form short-term joint accelerator programs; GenNext Ventures and Microsoft Ventures together mentor 11 start-ups. Sole investment is appropriate for firms such as Google Ventures, which has large funds and investment expertise. It is also useful when the company is looking for specific patented technologies and is eyeing an acquisition of a start-up that is aligned with its objectives. Sole investment is often used when the investment amount is small, such as Infosys’s investment SME ADVISOR
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Create a network of investors and syndicate partners to get follow-on investment or exit from the start-up.
in DreamWorks Animation. Such deals are fairly rare in India and are most common in mergers and acquisitions, such as AskMe’s investment in Mebelkart and Snapdeal’s purchase of FreeCharge. Four factors for success In a market that is full of frantic activity, where to invest and how to benefit both investor and investee are crucial. In India, four factors are essential to success: Avoid the fear of missing out. Overvaluation is becoming a big worry in some segments, so investors are on the lookout for undervalued properties with the potential to grow. Investors can evaluate start-ups not only based on cash flow and growth, but also strategic alignment, risk of imitation, and the sustainability of revenue. Ensure you can offer unique value to the start-up. With a growing pool of potential investors, start-ups are looking for firms that can provide more than just monetary support. Corporate VCs can provide industry and technical expertise, a business expansion
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strategy, talent, and operational support to move the start-ups through the stages of growth. They can also create a collaborative ecosystem for start-ups and industry experts to exchange insights and gain from each other. Also, start-ups can benefit from greater visibility through branding and contacts and lower financial risk through flexible fund size and exit timelines. Partner with other investors. Co-investing with traditional VCs or private-equity firms lowers the risk and the required fund size. Global investors can look for co-investors in India to filter out the most promising startups. Still, firms need an investment roadmap and an exit strategy from the outset, and they must be clear on the focus areas and strategic support to be provided by each investor. Develop exit options. Create a network of investors and syndicate partners to get follow-on investment or exit from the start-up. Google Ventures and Intel Capital have very strong investor networks that have enabled them to make more investments and to exit more easily. During exit, investors need to know the term of investment and the range of the return on investment, as well as the start-ups’ technology approval, market penetration, and profitability. Acquisition is also a conversion option, depending on strategic alignment with the start-up. Lastly, an exit strategy must consider the risks, including overvaluation, the lack of logistics and technology infrastructure, uncertainty over taxation, and regulations on foreign investments. An exciting time to invest The time is right to invest in this exciting digital start-up space. However, the window will close, so there is little time to waste. The key is to think upfront about the “why” and the “how” of investing.
Dynamic Duo!
Double-up your skills with two top sessions from the SME Academy Welcome to the new 2016 - 2017 season of the SME Academy
SESSION TWO:
SESSION ONE: Getting business finance: how to pitch for - and win - the funding you need
VAT, the Companies Law and your business in 2017 by
by Nathan Gold
Abu Dhabi 12:00 noon, October 31st, Jumeirah Etihad Towers
Dubai 10:30am, November 14th Abu Dhabi 10:30am, November 16th
MAKE SURE YOUR BUSINESS GETS THE SKILLS YOU NEED - AND
REGISTER ONLINE AT
WWW.SMEACADEMY.COM/EVENTS
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INDUSTRY OUTLOOK: HOW TECHNOLOGY IS DISRUPTING TRANSPORTATION Anand Eswaran, Corporate Vice President, Worldwide Services, Microsoft, looks at how automation is becoming an increasingly attractive proposition for the transportation industry.
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EDITOR’S PICKS 01. Traditional car manufacturers – not known for digital innovation – are embracing the ideas of connected cars and autonomous vehicles. 02. From entertainment and connectivity to predictive maintenance and customer support, the in-car experience is changing, as is our expectation of road safety. 03. The cloud, data analytics, artificial intelligence, augmented reality and other emerging technologies are the tools that enable new, improved and, sometimes, disruptive new business capabilities.
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Digital transformation marks the inflection point where new technology becomes the central nervous system of the business, connecting sales, marketing, finance, HR, production, logistics and customer service, while changing forever how companies operate and people interact.
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e are at the threshold of unprecedented value creation for industry and society, driven by the accelerating pace of change enabled through digital technology. Whether it is about bringing together patient records so they can be shared quickly for better patient outcomes, or changing the focus from disease management to wellness in healthcare, digital transformation is changing how we work and live. Called the Fourth Industrial Revolution, this significant disruption of traditional industries is fuelled by speed, the falling cost of technology and how quickly companies are growing. There is broad agreement that the economic opportunity from digital transformation could be as high as US$100 trillion across all industries over the next decade. This impact is broader than economics alone. Take the automotive industry as an example. Recent analysis from the World Economic Forum estimates approximately US$670 billion of industry value and
nearly US$3 trillion of societal value at stake by 2025, with 1 million lives saved due to digital transformation, and the mass adoption of autonomous vehicles. From Uber to Tesla and Airbnb, highprofile start-ups have already disrupted traditional industries. Every business and industry is considering what digital transformation means for them, and how it helps them reimagine their company and their industry. The question isn’t “if”; and the challenge isn’t “when,” but “how?” Embracing digital has had mixed results. Why? There’s no set path to digital maturity and mastery. What is the magic recipe for success? When you look at successful companies in different industries, two core themes emerge. First, enormous organisational change requires strong leadership — a clear vision tied to real business outcomes. Second, digital must be embraced across the entire business. Start with small projects that can be measured and learned from, but plan for all areas of the company.
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From Uber to Tesla and Airbnb, highprofile start-ups have already disrupted traditional industries.
The digital roadmap can be built from a few questions: • How does the customer experience change from sales to service? • How does the company empower people to work together, do their best work and get more done? • How do operations get optimised for efficiency? • How does digital open possibilities to transform products, business and, perhaps, the industry?
finance, HR, production, logistics and customer service, while changing forever how companies operate and people interact. The cloud, data analytics, artificial intelligence, augmented reality and other emerging technologies are the tools that enable new, improved and, sometimes, disruptive new business capabilities. It’s about combining those tools with business insight and techniques such as design-led thinking to examine a problem from a different perspective and envisage new opportunities. Microsoft is partnering with automotive companies worldwide to provide the digital platform to help rethink the possibilities for human mobility. Welcome to the era of the connected company. The connected people. The connected world at large. Digitally enabled and transformed.
US$100 Tn The economic opportunity from digital transformation across all industries over the next decade.
US$670 bn The industry value estimated by World Economic Forum due to digital transformation and mass adoption of autonomous vehicles.
Look at the automotive industry. We will reimagine how we build cars. We will reimagine how we buy cars. We will reimagine what it is to “own” a car. We will democratise the automotive experience for billions of people across the world, and we will do this with our emerging digital capabilities. Traditional car manufacturers – not known for digital innovation – are embracing the ideas of connected cars and autonomous vehicles. Real social and economic impact will be realised. From entertainment and connectivity to predictive maintenance and customer support, the in-car experience is changing, as is our expectation of road safety. Digital will transform every aspect of the automotive industry from core operations (supply chain, manufacturing, dealerships/retail, service) to the entire value chain (service, aftermarket, financing, vehicle insurance). Digital transformation marks the inflection point where new technology becomes the central nervous system of the business, connecting sales, marketing, SME ADVISOR
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Trends driving the automobile industry SYNCED EXPERIENCES: Wearable, mobile and biometric identifiers are being used to identify individual drivers, prompting an automated set of custom actions and settings that help personalise the ownership experience, while ensuring all driver data remains private and secure.
SELF-AWARE ANALYSIS: Connected vehicles are being built with the ability to monitor and diagnose their operations and performance, recognising potential maintenance or safety issues before they become bigger problems, and taking the necessary actions to ensure they’re resolved.
CONVERSATIONAL INTELLIGENCE: Developers are incorporating AI-driven interfaces into operating systems, allowing drivers to engage with and control a number of operations through conversational commands. These hands-free interactions open the door to a wider variety of seamless, in-vehicle experiences from productivity to entertainment.
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PERSONAL ASSISTANT: Vehicles are combining an understanding of individual behaviours alongside a wider variety of contextual information to serve up pre-emptive and personal reminders, recommendations and action. Mobile personal assistants are becoming more prevalent across devices.
ORCHESTRATED AUTOMATION: Cloud-enabled vehicles are becoming a key component of the broader connected ecosystem, from homes and offices to retail and core city infrastructure, increasing the opportunities for automated actions to be integrated into the everyday. These responses are kept secure through encrypted communications and operational processes, mitigating threats and optimising security for customer data that is preprogrammed into the system or transferred between environments.
AUGMENTED DASHBOARDS: Heads-up displays and projected information are creating hands-free ways for drivers to interface with multiple information streams while on the go. By changing the ways in which drivers access and interact with pertinent information, these technologies ensure greater safety and added convenience.
BIOMETRIC ADJUSTMENTS: Senior-packed vehicles are capable of monitoring a wide range of driver conditions, from alertness levels and general wellness to emotional state, and respond with a number of pre-set actions. Whether changing the lighting, adjusting the temperature or providing haptic feedback, these systems are designed to create a safe and comfortable driving experience.
CONTEXTUAL RESPONSIVENESS: Sensor-equipped vehicles are gathering and analysing information from their immediate surroundings – road conditions, other vehicles, etc. – alongside real-time information like weather and traffic data to make incremental adjustments to their performance and navigation, or take direct actions as needed, ensuring optimal efficiency and protection.
MOBILE HUB: Consumer-centric apps are connecting car owners to a broader community of drivers, to their vehicles and to experts for alwaysavailable communication for every stage of the consumer lifeline. These connectivity tools enable more seamless communication between the owner and their vehicle, as well as drivers to dealers and drivers to social networks, creating a smarter and frictionless journey.
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Looking ahead – Top technology predictions
Internet of Things (IoT) 6 Billion 22 Billion CONNECTED THINGS WILL CREATE IOT DEVICES WILL BE INSTALLED NEW SERVICE BUSINESSES IN 2018
BY 2018
32-Bit
12% OF CONSUMERS INTEND
MICROCONTROLLERS SHIPMENTS WILL OVERTAKE THE 8-BIT DEVICES BY 2020
TO BUY A SMARTWATCH IN THE NEXT 12 MONTHS, WHILE 41% PLAN TO DO SO WITHIN FIVE YEARS
8-bit
MICROCONTROLLERS WILL DOMINATE THE IOT THROUGH 2019
10%
OF THE GLOBAL POPULATION IS EXPECTED TO BE WEARING CONNECTED CLOTHING BY 2022
Sources: Gartner Says the Economics of Connections in Digital Business are Accelerating by the Use of Algorithms; Gartner Reveals Top Predictions for IT Organizations and Users for 2016 and Beyond; Gartner Says It’s Not Just About Big Data; It’s What You Do With It: Welcome to the Algorithmic Economy; Gartner Identifies the Top 10 Strategic Technology Trends for 2016; IDC Predicts the Emergence of “the DX Economy” in a Critical Period of Widespread Digital Transformation and Massive Scale Up of 3rd Platform Technologies in Every Industry; IDC Reveals Worldwide Digital Transformation Predictions; Kicks Off IDC FutureScape Web Conference Series; IDC On-Demand Webcasts: IT Industry 2016 Predictions; Digital Transformation 2016 Predictions; CIO Agenda 2016 Predictions; Forrester’s Companies Will Thrive And Fail In The Age Of The Customer In 2016; Forrester’s Predictions 2016: The Trust Imperative For Customer Insights Pros; Forrester’s Predictions 2016: The New Breed Of CIO; The World Economic Forum’s Global Agenda Council on the Future of Software & Society; and Accenture. SME ADVISOR
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Technology in the workplace 80% 125,000 27%
OF TODAY’S BUSINESSES HAVE A COHERENT DIGITAL STRATEGY
LARGE ORGANISATIONS ARE IN THE PROCESS OF UNVEILING DIGITAL BUSINESS INITIATIVES
INCREASE IN DIGITAL REVENUE IS EXPECTED BY CEOS BY 2020
2020
67%
60%
THE YEAR IN WHICH THE ENTERPRISES UNDERTAKING DIGITAL TRANSFORMATION INITIATIVES WILL MORE THAN DOUBLE
OF THE CEOs OF GLOBAL 2000 ENTERPRISES WILL HAVE DIGITAL TRANSFORMATION AT THE CENTRE OF THEIR CORPORATE STRATEGY BY 2018
OF ENTERPRISES WITH A DIGITAL TRANSFORMATION STRATEGY WILL LOOK TO CREATE AN INDEPENDENT CORPORATE EXECUTIVE TO OVERSEE THE IMPLEMENTATION BY 2017
Artificial intelligence 3 Million 20% OF ALL WORKERS WILL USE OR MORE WORKERS WORLDWIDE AUTOMATED ASSISTANCE TECHNOLOGIES TO HELP WITH DECISION-MAKING
5%
AUTONOMOUS SOFTWARE AGENTS OUTSIDE OF HUMAN CONTROL WILL PARTICIPATE IN 5% OF ALL ECONOMIC TRANSACTIONS BY 2018
WILL BE SUPERVISED BY A “ROBO-BOSS”
2021
THE YEAR IT IS PREDICTED THAT WE WILL HAVE THE FIRST ROBOT PHARMACIST IN THE US
Investments in technology 35% 50% OF IT RESOURCES WILL BE SPENT TO SUPPORT THE CREATION OF NEW DIGITAL REVENUE STREAMS BY 2018
OF IT BUDGETS WILL BE TIED TO DIGITAL TRANSFORMATION INITIATIVES BY 2020
30%
THE TYPICAL IT ORGANISATION WILL SPEND UP TO 30% OF ITS BUDGET ON RISK, SECURITY AND COMPLIANCE BY 2017 SME ADVISOR
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SME BEYOND BORDERS: POWERING A LIFESTYLE THAT IS #WORKINPROGRESS SME Beyond Borders celebrates the journey of entrepreneurs, the inbetweeners, the dreamers and the visionaries, who understand that to be an entrepreneur isn’t just a job, it’s a way of life.
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ith the eyes of the world on the UAE, the country is taking critical steps to advance entrepreneurship and innovation – aligned with the overall vision of the nation’s leaders. Dubai’s 2021 vision and Abu Dhabi’s 2030 vision are a reflection of the government’s commitment to fuel sustainability, smart technology and women empowerment. To build on these efforts and highlight the powerful record of progress made over the
last year, the team at SME Advisor decided to host its flagship event SME Beyond Borders Dubai. Every year, the mega-conference brings together entrepreneurs, industry leaders and investors in a large-scale gathering. So, what’s different this year? Our agenda. The content of the event is geared towards tackling various aspects of the SME experience. But, we won’t talk too much about it here and will let you decide as you enjoy the infographic in the pages that follow.
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OPENING THE EVENT PETER VOOGD Founder Game Changers, INC
MEET THE TRANSFORMERS ASAM KHAN CEO and Founder Exponent STEVE KATSAROS Founder/ Inventor Nokero AZIZA OSMAN Founder Jusoor
DISRUPTING MONOTONY THOMAS SEHESTED CEO and Founder GAN Integrity Inc KASWARA KHATIB CEO & Co Founder Uturn ADHAM MAGHRABY CEO & Co Founder Itagit Technologies BARRAK NAAMANI Founder Barrak Naamani Designs
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SPEAKER NATHAN GOLD CEO DemoCoach
DUBAI AS A GLOBAL AGENDA BERNARD LEE GlassQube LUMA JASIM BOURISLY Founder Kooot SAMEER BEJJANI CEO and Co-Founder Hoodi SHEZAN AMIJI Co- Founder Beam Wallet SHUGGUFTA KHOKHAR Clip
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ON THE MONEY
THE VC’S VERDICT
AHMED JALAL Managing Director The Abraaj Group
ALEXANDROS PATERAKIS Partner Lumia
MUSTAFA GHAZI KHERIBA COO ADFG
AMIR FARHA Founder & CIO Beco capital
TAREK MOUNIB Managing Director Gulf Capital
FARES GHANDOUR Partner Wamda Capital MOHAMMAD ALHAJERI CIO Impulse International WALID MANSOUR Managing Partner MEVP UN-CONFERENCE SESSION – PRESCRIPTION FOR GROWTH KARIM IDILBY General Manager Bupa Global Middle East ALA ATARI CEO Medcare Hospitals & Clinics ROBIN ALI Founder Consilient Consultancy SERGIO PADULA Technical Director & Lighting Design Expert iGuzzini
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IT'S ALL HAPPENING HERE!
THE INCLUSIVE AGENDA ELISSA FREIHA Founder WOMENA SOHA SOLIMAN Managing Director Social Fund For Development EMILY MAY Co- Founder & Executive Director HollaBack ROLA ABU MANNEH Senior Managing Director & Head of Client Relationships NBAD
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Fostering the manufacturing sector Traditionally, manufacturing has played a pivotal role in any country’s economy – whether its job creation, resource efficiency, modern infrastructure or technological advancement. The following feature reinforces the importance of fuelling this high-output sector…
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Manufacturing enterprises are the lifeblood of any country’s economy as they drive national development, skilled employment, infrastructural facilities and building of machinery, equipment and tools.
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he UAE’s increasing focus on creating a diversified economy with lesser reliance on oil and its ongoing efforts to improve the overall ease of doing business have significantly strengthened its position on a global scale. A large part of the onus to make this happen lies on the most prolific segment of the economy – manufacturing. Manufacturing enterprises are the lifeblood of any country’s economy as they drive national development, skilled employment, infrastructural facilities and building of machinery, equipment and tools. Moreover, they are critical to facilitate trade and export, which is vital for the financial prosperity of a country. Echoing this sentiment in her article for weforum.org, Jennifer McNelly, Executive Director at Manufacturing Institute, remarks: “How can we ensure innovation, competitiveness, increased income and a better quality of life? The answer, surprisingly, lies in manufacturing. The sector
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proclaimed dying in western economies could still be the vehicle to improve living standards. The link between manufacturing and economic growth is critical. Every dollar in final sales of manufactured products supports US$1.33 in output from other sectors - this is the largest multiplier of any sector. Manufacturing investments create ripples across the economy, creating jobs and growth in other industries. But how can we support the manufacturing sector, and therefore the broader, economy at the dawn of the fourth industrial revolution? Our research indicates three crucial factors: a focus on skills, continued innovation and technology, and more public-private partnerships.” Here, we take a closer look at these three fundamental factors –
ϭϭ Skills development:
The focus on education and skills development has been escalating within
the country – and the wider region – as is reflected in Dubai’s 2021 Plan and Abu Dhabi’s 2030 Economic Vision. Skills development and training is fundamental because the more trained your staff, the better their service will be to your customers. Therefore, human development is a long-term investment opportunity for your business.
ϭϭ Continued innovation and
technology: In terms of technology, a lot of focus has been on 3D printing. Manufacturers across a broad spectrum of industries including automotive, aerospace, dental, discrete, high tech and medical products are all actively piloting and using 3D printing technologies today. Prototyping has been a major reason driving enterprises to pursue 3D printing, with the opportunity of improving new product development
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and time-to-market being long-term goals. SMEs operating within the manufacturing sector will benefit most from investing towards innovative technologies and automation. These processes help reduce costs and increase production efficiencies. Key sub sectors that are doing particularly well and present significant growth opportunities are F&B, metals and plastic manufacturing.
ϭϭ Public Private Partnerships:
Public Private Partnerships (PPPs) are becoming the driving force behind the success of the sector. They open doors to large public investments allowing manufacturers to supercharge growth and undergo rapid expansion. This also works in favour of the overall economy as it encourages private sector investments into government-led projects, i.e. incentivising the private sector.
Manufacturing in the UAE: local origins, global ambitions Manufacturing currently accounts for 11 per cent of the UAE’s total GDP. A recent report by DED illustrated a sector-wise comparison across the country, in which it showed manufacturing as being the most optimistic sector, with 57 per cent anticipating a rise in sales volume and 25 per cent expecting further stability. Only 18 per cent anticipated a decline due to slowing market conditions during the third quarter. This points to a positive outlook for the sector in the upcoming months. To support this upward trajectory of the sector – and to recognise the increased efforts of growing enterprises – National Bank of Abu Dhabi is spearheading an initiative called the ‘Star of Manufacturing’ Award. Every year, the Award opens applications to the nation’s manufacturing SMEs and after an intensive auditing process, one winner walks away with the
coveted title. For the third consecutive year, the Bank will honour one SME with this prestigious Award at the glittering Stars of Business Awards ceremony to be held on October 27, 2016 at the Atlantis Hotel, the Palm.
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LOGISTICS SIMPLIFIED AZAD FAROOK HEAD OF FINANCE EXPO FREIGHT (EFL)
EDITOR’S PICKS 01. EFL, headquartered in Sri Lanka, is one of the largest freight forwarders well established in Asia, Africa & Middle East regions networking 20 strategically located countries Bangladesh, Cambodia, China, Egypt, Hong Kong, India, Kenya, Madagascar, Maldives, Mauritius, Myanmar, Pakistan, Philippines, South Africa, Sri Lanka, United Arab Emirates, United States of America and Vietnam. 02. EFL’s presence in strategic sourcing markets is backed by end-to-end solutions ranging from consolidations to pre-retail activities and a host of warehousing in key locations around the world. 03. What started as a small team in a 300, sq. ft. office has emerged to become a global brand that has endured all the challenges of operating in limited transportation infrastructure markets. The ability to deliver flexible and customised solutions consistently over the years has been one of the key points that has led to the growth and expansion of the brand. 04. Widely known as ‘Expo’, the company underwent a rebranding exercise in 2012 and established itself as EFL introducing a new visual identity and tagline.
You know you have a found a winning solution when it helps you boost revenue, simplify operational processes and streamline communication – all at a viable cost. This is what Expo Freight discovered when it partnered with the region’s leading telecoms provider Etisalat. In the following article, we learn more about their experiences…
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rom small beginnings as a freight forwarding company in the heart of Sri Lanka, Expo Freight (EFL) has evolved to become a global logistics provider – offering a wide range of customised solutions. Azad Farook, the company’s finance head, says: “As a an international logistics company, we offer expertise in airfreight, ocean freight, multi-modal transportation, warehousing and distribution, 3PL inland transportation, customs brokerage, value added services for retail, specialised cargo handling, project cargo, transhipment services, air charters, and in-house import/export customisation. We established our identity in Dubai in 2004 and set up the Abu Dhabi office in 2007, followed by the Jebel Ali office in 2009. Our goal is to provide end-to-end solutions to our customers. With over 30 years of worldwide experience, we are well equipped with state-of-the-art facilities manned by a dedicated and immensely experienced professional workforce to ensure that our global customers’ needs are met both effectively and efficiently.”
This case study is about
Drawing on its expertise as a trusted logistics partner, Expo Freight has successfully secured a good share of the UAE market. It works with an impressive customer portfolio that includes oil & gas companies, manufacturers and/or traders in apparel, electronics, automobile spare parts, perishables, foodstuff, machinery, chemicals, ship spares and oil field equipment. “Expo Freight stands out as one of the top freight agent in the UAE. We strive to achieve and sustain maximum customer satisfaction by giving reliable and economic quality driven services our customers,” he further explains. This commitment to customer satisfaction and a high level of service have become the hallmarks of EFL. “Our clients entrust us with what matters to their business; from clothing and consumer electronics to perishables and pharmaceuticals. This is backed by a network of strong partnerships with key suppliers to a team highly conversant in documentation and clearance procedures.”
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Since ‘service’ is a fundamental part of our company ethos, it was significant that we partnered with someone that could help us communicate more effectively with our clients.
Using technology to build a competitive edge While Azad and his team have succeeded in their expansion and growth across key new markets, their vision is to create a company that is built around cutting edge technology. “If you want to stand out from competition, you have to provide a strong value proposition to your customers. In our case, it has been all about connectivity, speed and agility. So it involves assessing how quickly we can get in touch with our customers and our ability to give them real time updates. Particularly within our industry, it is very important to be on top of everything. This is exactly why we’ve been investing in technology and have made it our topmost priority. We all know that our industry is currently undergoing a digital transformation. Having an online platform to serve our clients with latest technology while tapping in to e-commerce is necessary.” In order to work more effectively with its customers, enhance technological capability and continue supporting its growth, Expo
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Freight needed an ICT partner. “We selected Etisalat as our service provider since EFL’s inception in 2005 and we’ve enjoyed a wonderful working relationship with them ever since. We are one of their corporate customers and use their server across all our offices in UAE. Moreover, they manage our landline, mobile and internet services.” Speaking of their long-term partnership with the telecoms provider, Azad enthuses: “They were our partner of choice because Etisalat is the leading service provider in UAE and the expertise they bring to the table is second to none. Since ‘service’ is a fundamental part of our company ethos, it was significant that partnered with someone that could help us communicate more effectively with our clients. Furthermore, we have a dedicated relationship manager, who ensures that all our needs are being met.” He adds: “What really strikes a chord with us is the extensive industry-specific knowledge they have. On several occasions, I have participated in programmes conducted by Etisalat where they highlight the opportunities and challenges within each
industry. This is then complemented with a suite of solutions to support.” Future ambitions While EFL is making its mark today within the Gulf region, it still aspires to become bigger – and better. “We will continue to build and strengthen our global network, and of course deepen our roots within the UAE market. Our team strives to stay ahead of the curve and offer solutions that are customised for our customers,” remarks Azad. And, he hopes to achieve all this while staying true to his origins. “We are excited about the speed at which we are growing, but we are also conscious about being a start-up at heart.”
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REINVENTING RETAIL
From technology to talent, John Tsioris has drawn upon all his resources to redefine traditional retail. Now, he tells SME Advisor about his audacious plans for the future.
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hink of weekend grocery shopping and you probably wince. The idea of looking for parking, walking through crowded aisles and waiting in queues is hardly appealing. For all the people that absolutely dread their weekly grocery shopping trips or simply can’t find time for it in their busy schedules, InstaShop comes to the rescue. “InstaShop, as an idea, was with me for a while. Being a busy young professional working long hours, I felt the need for a reliable on-demand grocery service to buy me some extra free time to do the things I enjoy. I used to order basic items from the local grocery by phone, but most times, the experience was quite bad with wrong items delivered or the order simply never arriving; this frustration is exactly what triggered the idea of InstaShop. I wanted to avoid the long supermarket lines and the traffic on the way. I realised there was plenty of space to uplift the service level with the use of technology,” recalls John Tsioris, Founder and CEO of the online shopping portal. When he realised that the idea of InstaShop could actually make a big difference not only in his life but the lives of others as well, John began working on developing the concept. “I shared it with my team; these were people I had already worked with previously and had immense knowledge of the start-up industry. The first step was to understand whether such service would cover an existing need in Dubai. The next step was to undertake market research in terms of market ripeness and competition. We also consulted our developers to understand the complexity and costs of such an endeavour,” he explains. While a detailed and thorough market research plan played a pivotal role in setting strong foundations for John’s business, what really propelled his start-up was the strong chemistry he shares with his team. “Bringing InstaShop to life was 100 per cent the result of team work of five people comprising the initial team that is with us until today.
EDITOR’S PICKS 01. InstaShop is rapidly expanding its service areas, from only covering Dubai Marina when it first started, it now serves more than 40 areas in Dubai and delivers thousands of orders daily. 02. While a detailed and thorough market research plan played a pivotal role in setting strong foundations for John’s business, what really propelled his startup was the strong chemistry he shares with his team.
Most of the founding team members, I have known for several years, we know our chemistry blends and our relationships have survived through rough times. This good chemistry and hard work were the ingredients of a great start.” Armed with the unbeatable combination of market intelligence and talent, John was ready to set up shop. Within a month’s time, InstaShop was presented to its first partner shop as a minimum viable product, introducing a simple and clean iOS mobile application and a basic backend structure to facilitate the monitoring the first orders. The website immediately scored its first supermarket partnership and the first pilot in Dubai Marina brought back impressive results! Reeling in the success of their first project, the team decided they were ready to incorporate their freezone company. “Our first partners immediately appreciated the value and simplicity of the product and so we started covering a part of Dubai Marina in June 2015. Within SME ADVISOR
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Don’t wait for the ideal moment and forget about fear and those discouraging voices and start today, or even better now.
Established: June 2015
Employees: Started with 3 people, now more than 20 USP: Groceries delivered in less than 45 minutes Challenge takeaway: Learn from the past. Before starting InstaShop I tried my luck in the start-up world with a voice social network called Vound. The endeavour wasn’t successful, but it was a great learning experience. It encouraged me to let go and pursue something new. If I had let Vound get to me as a past failure, I wouldn’t have been able to formulate InstaShop. Instead, I learnt from this past performance and built up even more confidence to move on with my next venture.
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two months we had expanded our coverage bringing in another three supermarkets. For a minimum viable product and minimum marketing expenses I’d say we knew back then we had something good on our hands. One year and three months later we’ve come to cover most of Dubai’s important areas, with up to 50k active users as per June 2016 and counting!” John’s successful business didn’t just attract the attention of enthused customers, it had also managed to get on the radar of potential investors. “InstaShop is blessed to have on board top class investors almost since Day One. Our investors are one of the greatest assets we have, we work together as one team. We enjoy amazing synergies from the past experiences and connections of both Jabbar Internet Group and Venture Friends in the e-commerce realm, as well as in the overall entrepreneurial ecosystem. For me personally, this is by far the greatest value our backers bring into our company, cash is just the means to achieve our shared vision.”
Customer first The technology market in the region provides immense opportunity for entrepreneurs like John, but that also means creating a niche for yourself in an already crowded, competitive market. His mantra? To stay focused on his ultimate objective: keeping customers happy. “Our users are our first priority; we operate, change and evolve fuelled by their needs. Of course we keep an eye on how the market moves but we are always focused on customer feedback in order to improve our service as sometimes you might be disoriented by paying too much attention on what other industry players do. Many ask me about how I managed to secure funding for my enterprise. We don’t get distracted by competition, we work hard and the value created has brought us to where we are today, with top-notch investors on board.” Function over form John says: “Operating a start-up is full of challenges; it’s quite difficult for me to
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pinpoint one. This industry is characterised by innovation and fast pace, most of the things we do are for the first time and need to be updated constantly, so we are faced with the struggle of maintaining operations while evolving to accommodate new trends and features. We want to give our customers a beautiful end product in terms of the web portal, but simultaneously also want to be mindful of its functionality and usefulness.” Speaking of his experience of being an entrepreneur within this region, he adds: “The Middle Eastern market proves to be very fertile for e-commerce start-ups like ourselves, given the people’s way of life, working long hours and of course the hot weather. Offering a convenient service that aims to free up their time results in early adoption. Of course you can’t rely on the people’s eagerness to try a service and call that a win, there’s a lot of work to be done so that service fits the audience and gives the expected value. The Middle East has an extremely diverse population; targeting and catering the needs of these different audiences is one of the biggest challenges we face.”
Clicking their way to success InstaShop is rapidly expanding its service areas, from only covering Dubai Marina when it first started, it now serves more than 40 areas in Dubai and delivers thousands of orders daily. A year after its product launch, it’s grown from five to more than 20 people in its team. For John, however, this is just the beginning. “Our first goal is to expand and make our presence notable in the UAE region. That means moving fast, closing deals while keeping our user acquisition cost low. We have designed our revenue stream structure, which is mostly based on the commission received by our partner shops and product promotions. Our longterm objective is to free people from tedious tasks. This journey started from Dubai and our goal is to expand this service to cover Abu Dhabi and soon bring this innovative way of grocery shopping to other cities of the Middle Eastern region. We aspire to be the largest on demand grocery delivery service of the Middle East.” And this isn’t just wishful thinking – his ambitions are backed up with substantial efforts by his
team. “There’s one thing I can say, our team never sleeps. We have just launched our on-demand maid side-service, enabling our users to order a house cleaning and we will be there in as soon as two hours. Another key feature that has been long anticipated is that of online payments, which we should have live within the next two months. We piloted an organic shop proposition in September and finally a web-based shop will be live by end of year for those who prefer to use the personal computer platform.” John is also watching the market trends very closely. “I believe we’ll see more of robot assisted delivery and social selling in 2017. Drones are making their entrance in the delivery realm and it’s quite fascinating to see this evolve. Moreover social platform integrations are very interesting and I am looking forward to experimenting with that,” he asserts. Living the dream John believes that he is living the entrepreneurial dream. “I didn’t start pursuing my entrepreneurial dreams until I was 28 years old. I am grateful of the years I spent working for my prior multinational employer; I learnt so many things I can implement today. My biggest advice is if you have an idea, start today! Don’t wait for the ideal moment and forget about fear and those discouraging voices and start today, or even better now. There is no better experience than the one gained trying to make your start-up fly, learning how an industry works and building the best team.” We definitely agree, John! SME ADVISOR
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VIEW FROM THE TOP Asam Khan changed the way the steel industry tracks and monitors its inventory forever when he launched Exponent. In an exclusive with SME Advisor, he opens up about his journey so far…
EDITOR’S PICKS ASAM KHAN COO EXPONENT
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01. Asam’s invention is the perfect marriage of technology and science to simplify a complex task. 02. Exponent’s solution allows the steel industry to quickly determine what is located and where, with a simple drone flight over their yards.
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sam belongs to a cohort of entrepreneurs who believe they can address a largely unnoticed problem using simple technology: using RFID technology in drones to scan important data from inaccessible areas. But he’s also a self-confessed tech whiz who refuses to take credit for the idea. He smiles as he looks back to the time he came up with the concept. Exponent has been his dream project – both literally and figuratively! “I was in the field of Auto-ID Inventory tracking and had failed at producing a workable solution to track steel inventory in an open yard for over three hot summer months. One day, I had a revelation in my dream: a drone that was pushing a vacuum cleaner over a dirty rug. On awaking I made the connection – a drone that could suck up RFID information on tagged steel bundles!”
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“Locating individual inventory items in large open yards can be an extreme challenge. The steel industry is particularly vulnerable as their stock moves very fast and being able to secure orders is intricately linked with their timely fulfilment. If you have the stock, but cannot find it to deliver in time – you effectively lose the order (or a large part of the profit – as you have to source from your competitors to provide the same items). Our solution allows the steel industry with a simple drone flight over their yards, to quickly determine what is located and where. No human intervention is required beyond telling the drone to fly an autonomous flight path and report back its information in real time as it flies over the yard (the drone is connected to a yard WIFI). After the flight, the drone automatically lands and shuts off at a
predetermined landing point,” he explains of his product. Asam’s invention is the perfect marriage of technology and science to simplify a complex task. Isn’t it a wonder then that he was the first to launch such a solution? “There was no solution in the market – it had to be built from scratch. The drone was acquired by only revealing the weight of the RFID antenna that needed to be carried and what we thought would be a typical flight time. We architected a solution, acquired the components, integrated them and then proceeded to conduct a very hectic testing program. We received our first drone within three weeks of the initial conception and crashed it within 30 minutes of unpacking it!” This was just the beginning of his problems. What followed was a nine month
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The market reaction to our product varied from sceptical to mild curiousity, followed by a tepid agreement to see a demonstration, and then an endorsement of the solution.
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Established: September, 2012
Employees: 22 Year on year growth: 2015 was 211% in 2015 and 530% in 2016 USP: Exponent’s solutions generate a high ROI for clients by not only reducing time and resources, but extending operational capability, capacity and efficiency through rapid innovation. Challenge takeaway: Rely on others as little as possible, but don’t be afraid to ask for help when you need it. You ultimately are only as good as your team and your team can be far greater than the sum of its parts depending on your ability to lead them astutely and fairly.
development effort to iron out all the wrinkles in the solution. “It took us nine months and plenty of problems to understand how to make a drone fly autonomously and safely – at what altitude and speed to pick up the RFID tags at acceptable rates and how to correlate this to position location. Not to mention coordinating with local (Dubai Civil Aviation Authority) and federal (General Civil Aviation Authority) aviation authorities on how such flights can remain segregated from the national airspace and also how to ensure that the privacy issues could be addressed.” Asam tackled these one after the other as they arose with his entrepreneurial spirit still running high. “The local authorities proved to be the most helpful in understanding what we were trying to achieve and even took feedback from us on how this technology could potentially evolve,” he adds. Mapping growth Now that Asam is on track with this drone technology, he’s spending a lot of time
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refining his growth plan and building internal structures. First on his agenda is hiring top talent. “I’ve been in the process of finding appropriately qualified resources to execute my vision for the company. I did expect it to be a bit tough because we are working with a new technology and the experts in the field are mostly hobbyists who do not do this full time. So the approach I take is slightly different. I hang around hobby clubs and hobby shops hoping to run into people who are interested in making a career out of their hobby. It has worked quite well so far; I’ve recruited three of my key employees in this way!” Next on his list of priorities is funding. “A group of friends believed in me and the idea enough to invest approximately AED 2 million to bring the solution to market and to establish a strong multi-disciplinary technology team to deliver custom solutions. However, to access secondary
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We are currently five investors (friends and family) and are about to launch our first Series ‘A’ round.
finance, you require three years of audited statements to qualify for any sort of debt. This results in us being dependent upon constant equity injections that dilute the primary owners, i.e. the ones who have the vision to create the venture to begin with. A major obstacle I have to face now is that new investors raise the concern that my personal stake is not as high as it should be and there is a risk that I may just walk away from the business.” On a more positive note, however, Asam’s leadership and vision have helped propel the fairly young company to new heights of success. “We started with one US-based client and gradually went on to secure contracts with Dubai-based government and prominent private entities. We’ve gone from: one client in 2012 to 10 active clients in 2016; a net revenue of AED 53,000 in 2012 to a net revenue of AED 5 Million (Q1&Q2) in 2016; one Dubai office in 2012 to three locations worldwide including Boston, USA and Singapore. In fact, our
resource levels have also experienced exponential growth going from one resource in 2012, three in 2013, four in 2014, 11 in 2015 and 22 in 2016.” Accelerating ahead While Asam has built his entire proposition around drones, the rest of the industry still isn’t fully convinced of their potential. This doesn’t seem to deter him. He shares his thoughts on market movements: “My outlook is that the industry will be heading into a maturity stage as commercial operations begin to see wide-scale adoption of the technology, driven mostly by a more defined regulatory environment. I believe that drones will become a more integrated feature of our urban landscape as their adoption becomes more acceptable to govt. and security agencies. Of course, the inverse is just as possible – one malicious use of a “rogue” drone can also set the industry back. However, I am an optimist and cannot see the constriction of an entire industry
based upon a single possible misuse – all technology is a double edged sword and cars would not be banned because one individual used one in a hit and run.” And, where does he see Exponent fitting into the larger picture? “On our immediate agenda is to integrate our solutions with a custom generic app that can be extended by third parties via an API. We have begun our US operations with an office in Boston and hope to open our Singapore office this year. We have secured our FAA 333 exemption which permits us to conduct commercial Drone operations in the United States – we are hoping to leverage this into providing on-demand solutions across the tristate area (New York, Connecticut and Massachusetts). We are just about to launch a product and service to conduct drone monitoring and tracking. This will be a significant departure from our current solution bank and revenue model. Ultimately, we are still growing – and learning as we go.” SME ADVISOR
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CULTIVATING CULTURE IN AN IT FIRM Departing from its standard case study format, SME Advisor reached out to local HR consultancy PeopleFirst to share its experience of working with a well-known IT firm in the region. In this detailed excerpt, Amal Bajawa outlines the realities of managing employees as a technology SME.
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t’s just another day in the life of Amal Bajawa. She’s been contracted to work for a growing IT enterprise that is currently facing challenges maintaining a healthy balance between talent and technology. Given her vast experience in the field, Amal knows straightaway that the solution is to develop an ‘agile and lean’ Employee Handbook that reflects the culture and working practices of the company. But she has to bear in mind that the company – with 50 IT professionals employed – expects to double in size over the next two years. “The company is unique in many ways, starting with the non-hierarchical management style which reflects the dynamic, progressive and forward thinking culture of the company. Employees are
encouraged and expected to operate autonomously but with the appropriate levels of accountability to deliver what is expected of them. Employees are allocated to projects but are allowed to operate independently and with the flexibility to manage their own time and performance. This in turn breeds a strong sense of collaboration and teamwork. The environment is relaxed and encourages creativity and innovation which are core competencies of organisation,” she explains. Working closely with the management team, Amal is certain that the Employee Handbook is a critical HR and business tool that would engage employees and help embed the desired culture without defining the traditional boundaries of what
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We live in a world where technology and talent are intertwined, you can’t build a great company by focusing only on technology.
an employee should or should not do. The management team wanted to benchmark its policies and practices against global IT companies that were well renowned for creating the ‘right’ working environment and culture in which employees are allowed to flourish and perform. The process Amal set out undertaking the necessary steps required to develop the bespoke Employee Handbook. She entails her stepby-process: “The focus of the first step was to understand the company culture, ways of working and current HR policies and practices. The information was gathered through site visits, and face to face meetings with managers and employees from the client team. This was followed by Step Two: during this step the benchmarking exercise focused on two areas; firstly ensuring legal compliance and secondly alignment to best practices across similar companies. A comprehensive list of policies was developed and agreed to ensure the robustness and completeness of the Employee Handbook.” She continues: “In Step Three, high level recommendations were developed for each policy and these were reviewed with the client and signed off. The policy recommendations were geared towards creating the desired company culture. The final step saw the development of the detailed Employee Handbook. Specific attention was given to the ‘tone of voice’, language and messaging of the policies. The written word had to reflect the ‘culture’ of the company.” SME ADVISOR
The management’s expectations of the Employee Handbook were simple. They wanted something that would tick the following boxes – • The Employee Handbook must reflect the culture and working practices of the company • The document must not be a lengthy manual that is too prescriptive • It must ensure legal compliance (Labour Law and HR Management Law No. 27/2006) • All HR policies must be included to mitigate any risk for the company and its employees • The language must be engaging, friendly and easy to understand • When reading it, employees should get the sense of autonomy to manage themselves and be accountable for their behaviour whilst being responsible and protecting the company’s interest • Policies should be benchmarked and aligned to best practices
The challenges Do you wonder: how can a business give its employees flexibility while still ensuring their adequate productivity? The executive team at the IT firm sure did and they soon approached Amal. “I mean this is a tough challenge. It is so important to really understand the company culture, the people and what the company was trying to achieve. For example, the organisation promotes a very relaxed environment, free from typical organisational boundaries such as job titles or any type of formal hierarchy. But at the same time, you have to integrate a sense of responsibility and accountability. It is such a fine line and the reality is that companies that succeed in finding that balance truly prosper.” In this case, Amal suggested that the company implement a system that linked payment with performance. “The idea is to incentivise employees to get more done and earn more. Moreover, team leaders were appointed. Team leaders are selected based on what specific skills they have to
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offer to a specific project so everyone has the opportunity to lead and/or contribute depending on what is needed and their specific skill set. Employees are encouraged to take regular breaks and the rest area has a games room in which employees are encouraged to relax together and compete against each other in a fun environment.”
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The Employee Handbook reflects the culture and working practices of the company
The outcome A customised Employee Handbook, written in a friendly manner that was easy to read and served as an easy reference guide for managers and employees. An extract of the Employee Handbook which reflects the autonomous and flexible culture of the company. The nature of work encourages flexibility and people move from one project to the next as needed and teams are formed based on the requirements of the project with only the end game in mind. “We were also very specific about the probation period. We said that we understand it takes some time to settle down and we will support you fully during your three month probation period. During this time, the notice period is five days either side. In terms of the annual leave, we believe in a healthy work life balance and regular breaks away from work. Although you are entitled to 30 working days per year, you can take off as much time as you want. There is no need to get any prior approval and your leave is not monitored. We expect you to take your leave when you are fully comfortable that your project is at a good stage and that your leave will not disrupt the business operations in any way,” she advises. “The ultimate goal, for any company, is to ensure that they are creating a comfortable environment for their employees to be productive in. We live in a world where technology and talent are intertwined, you can’t build a great company by focusing only on technology,” she concludes. SME ADVISOR
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FLYING HIGH A Vitaly learnt about aviation when he spent 15 years working as a professional within the industry. It is this very experience that has propelled him to become one of the region’s most innovative entrepreneur…
wery Aviation Solutions was born out of the desire to combine professional acumen with entrepreneurial flair to create something extraordinary. And indeed, that was the outcome! Vitaly Smilianets had almost 15 years of professional experience in global aviation software projects along with expertise in IT solutions, WEB, rich internet applications, ERP Systems, mobile platforms and software development. His life in the corporate world had been enriching and rewarding. Even so, he knew he could build something bigger. “I wanted to use all the knowledge I had gained over the years to create a unique solution,” Vitaly recalls. “My market research showed me that aviation professionals relied heavily on Excel for their day-to-day processes. Given the complex nature of the industry, I knew that there was scope for a better solution. I identified this gap in the market and immediately seized the opportunity. I collaborated with fellow aviation experts and started working
towards launching a product that would help streamline operational processes within the industry. The product development process began in 2008 and we launched it in 2009.” For Vitaly, client feedback was crucial to gauge the effectiveness and efficiency of his product. “Our product uptake was quite high from Day One. The fact that we had clients paying for our product confirmed the market fit. The reaction was very positive as we provided them with a complex tool that helped to lessen the pain in their daily operation routine,” says a delighted Vitaly. The positive feedback gave Vitaly and his team the confidence they needed to accelerate growth and expansion. They continued evolving their product – integrating latest technology and incorporating client customisations. “Of course, technology is changing rapidly and we had to set our product development roadmap for the next several years. We were monitoring the trends every day to be aware of any disruptive changes. We also built
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EDITOR’S PICKS 01. Awery is a fast-growing software development company and IT service provider based in the UAE. 02. Having more than 10 years’ experience in the aviation industry, Awery provides unique aviation solutions, concepts and vision. 03. The company’s solutions have been developed for and in cooperation with aviation and logistic companies to reflect current market demands, offer complete business cycle solutions with unlimited expansion capabilities and in accordance to industry standards.
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strong industry collaborations. For instance, we partnered with a senior UAE aviation professional, who had 30 years of experience in the industry. He contributed significantly by providing recommendations from Day One and sharing feedback and ideas for improving the product.” Speaking of the product itself, he says passionately: “There is a cloud-based and a hosted solution available for our clients. Cloud based is a perfect fit for small and medium sized aviation businesses, while the hosted one is for big aviation players with sophisticated IT infrastructure. We started as a hosted solution for large companies with more than 50 employees, now with a cloud system offer we are able to serve clients of any size, even with 1+ employees.” Full featured solution to cover all the needs of software in a company, two leaders in the market as our clients.
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Vitaly recognises the importance of a focused sales and marketing approach.
Tackling turbulence In the recent years, Awery has faced the challenge of setting up its sales function. Vitaly recognises the importance of a focused sales and marketing approach. “Our priority until now was developing a worldclass product for our customers. We have a competitive product and a great team so we are ready to scale. At the moment we are structuring all the processes that will make it possible. Sales is an integral
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Vitaly’s strong professional background and extensive experience have helped him overcome business challenges.
Established: September, 2009 Employees: 24 Year on year growth: 20% USP: We are a web-based, extremely flexible and customisable platform that aids with managing fundamental aviation business processes – ultimately increasing productivity, reliability and efficiency. Challenge takeaway: Making decisions on your own, seizing the opportunity and being passionate.
part of this. All the sales we’ve gotten so far has been through reaching out to our personal network, word-of-mouth and client testimonials. We haven’t been aggressively selling – or hired anyone to sell for that matter,” he admits. “Now that we are satisfied with the product, it’s time to develop this new facet of the company. Of course, building a killer sales team from scratch is no easy feat and it has been quite challenging. We’ve been trying to break stereotypes; it’s hard to sell a new product, disrupt the market – especially in such a conservative industry. It is also critical to find people that are as passionate as us about the product. Moreover, they need to adapt to the existing company culture.” Vitaly’s strong professional background and extensive experience have helped him overcome this challenge. He used his industry contacts to reach out to people that are not only talented but also have the ability to learn quickly. Now that he’s bringing on board the right people, he’s looking to create the right strategy. “A structured approach is required to generate results. We’ve set out a clear sales strategy and have committed to training our salesforce. We host weekly meetings to ensure that we are on the right track. Having
frequent interactions with them helps us understand their concerns and improve the internal processes.” Reaching for the stars “We are working on new product modules that will help fuel our growth. We are scaling geographically – US is a prime target market. We already have global clients from all over the world and our goal is to grow the numbers in the most promising regions. Our strategy has been to play to our strengths, which is why we continue to furnish our understanding of the aviation businesses: their problems, needs, internal processes, etc.” Funding is also on his mind. “Currently, the company is self-funded. We haven’t raised any investments yet. Nevertheless, we are open for discussion. It is imperative that we find a partner that provides more than just financial assistance. We are seeking for professional feedback, expertise and mentorship.” Even though there’s a lot that Vitaly has to juggle, he remains completely unfazed. The secret? He smiles when he says: “As a business owner, having to wear several hats is normal. It’s when there’s nothing to worry about that I get worried!” SME ADVISOR
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A PIXEL IS WORTH A THOUSAND WORDS Dany I. El Eid, Founder, Pixelbug, has already created a niche for himself with his innovative business idea. He is now taking his ground breaking concept to the Dubai Future Accelerators Programme.
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s a child, Dany loved watching movies like Star Wars. It was out of this fascination for futuristic movies that he got an idea for his business. “The idea to create Pixelbug was inspired from these sci-fi movies, which I was a big fan of when I was a kid. I came across augmented and virtual reality when it was still in its early stages, being used for industrial and military purposes. When I realised that consumer hardware technology was quickly evolving to accommodate the processing power needed for AR & VR, I understood that there was an opportunity to capitalise on. Hence, I took the leap to establish a company that could provide commercially viable state-of-the-art AR and VR solutions for consumer adoption, straight out of Dubai – a city that wasn’t necessarily known for its buzzing entrepreneurial and tech ecosystem back in 2012, to
help businesses better engage with their audience in a more digitally enabled world.” An entrepreneur’s checklist When Dany was undergoing the process of inception, he put together a checklist that was immensely helpful in guiding him at every step of the way. He shares interesting excerpts from his diary… Market research: Before launching Pixelbug I was heading a digital division in a well-known Dubai-based company so I had lots of exposure to problems that clients and end users were having in regards to deploying leading edge tech with local understanding. Therefore, I chose to setup in Dubai to be able to cater to the demands from companies in this market rather than having them seek for highly overpriced or below par solutions abroad.
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EDITOR’S PICKS 01. Before launching Pixelbug, Dany was heading a digital division in a well-known Dubai-based company. 02. he actual development part prior to launch of the product took six months. 03. The Colorbug augmented reality edutainment product was the culmination of three years of R&D, working closely with leading multinationals, families and educators.
Collaboration: Nothing can be achieved without some help and support. I come from an entrepreneurial family and was able to rely on past experience and family members for guidance. I also had the privilege of knowing Kamal Hassan who mentored and supported me from Day One, through thick and thin. Funding: To build the company, I opted for the self-funding route and bootstrapped for three years. At the same time, we are proud to have highly reputable investors and shareholders on board, who joined this year and are supporting us to expand globally. Product development: The Colorbug augmented reality edutainment product was the culmination of three years of R&D, working closely with
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leading multinationals, families and educators. The actual development part prior to launch of the product took six months. We knew it was time to launch, despite several technical and design issues, before the opportunity window closed. In our industry it is important to ship the product, quickly learn from user responses, and iterate on the go. Otherwise, there is a risk of missing the first mover advantage which is crucial for a start-up in most cases. A viable business model: Our main revenue stream is generated from businesses who are seeking to use our AR/VR software, and leveraging our Colorbug product for marketing outreach. At the start of our journey, we were experimenting with different
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One of the main problems that we are facing now is access to funding from investors who are not highly tech literate and have the tendency to invest in copy-cat models from the West, rather than take the risk with home grown innovation.
Established: Q4, 2012 Employees: 10 Year on year growth: 20% USP: Using state of the art augmented and virtual reality to take businesses beyond conventional media and help them engage with their consumers in deeper, more meaningful ways. Challenge takeaway: Never underestimate the power of perseverance and grit!
types of technologies such as projection mapping, gesture based interfaces as well. However, the uptake from both regional and international clients were mostly centered around AR & VR, so we chose to focus on that field in 2015, when we decided to launch our suite of AR & VR products starting with our flagship application called Colorbug. Swimming with the current One of the main challenges for Dany and his team has been educating the market about the necessity to adopt new technologies such as AR & VR and how it could benefit their business. He has found that the only way to tackle this challenge is to keep reinforcing the message and emphasizing real life cases in a way that everyone can understand. “Driving this message from the very beginning and pioneering in the field, even before the big tech companies validated the viability of our technology, has definitely allowed us to carve a unique position as the award-winning, leading-edge tech company coming out of Dubai, a city that wasn’t particularly known for its knowledge based, innovation driven economy.” Breaking the mold A super excited Dany can’t wait to break the news when asked about his most notable achievements. “Today, we are proud and privileged to be amongst the only companies globally to be selected in the Dubai Future Accelerators Programme and working closely with the KHDA towards pulling Dubai, and the UAE, towards the future faster, specifically in regards to improving education and making learning Arabic more engaging across all age groups,” he exclaims. “We have succeeded in building a reputation based on being the leaders in the region in creativity, technology and customer support. The grants and awards we’ve received by the MIT Enterprise, Forbes and the Publicis Groupe are a testament to our pioneering achievements.”
Staying abreast trends Commenting on the current status of the market, he says: “There is lots of momentum around the AR & VR space at the moment, particularly with the recent rise of Pokemon Go which helped in bringing the technology into mass consciousness. Sony is also releasing their PS VR device which will take VR into the mainstream. I’ve tried it prior to launch at the Viva Technology conference in Paris and I can say that it is very impressive for a device at that price point. Our pioneering position as leading software developers for both AR & VR have allowed us to have access to beta versions of their development tools and maintain a healthy edge over other competitors. There’s also the imminent release of the Magic Leap and Google Daydream devices, which will take the space to a whole other level. I’m very excited about the future!” Plan for global domination In the short-term, Pixelbug is focusing on integrating our AR technology into the educational system of the UAE, with the help and collaboration of the KHDA. It has an exciting road map ahead of it that involves tying in with several strategic partners in the publishing, advertising and media industries which will move these highly regulated and traditional areas towards being more relevant for the current generation of users and consumers. “I just recently came back from San Francisco where we had our US debut by showcasing our technology at the high profile TechCrunch conference. We’re very excited about what 2017 will hold in terms of global expansion. Indeed, we are currently expanding our platform to make it more open and accessible. We are also adding lots of new exciting features that will make learning more fun and engaging for kids of all ages,” he concludes.
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CRACKING THE SCREEN: THE NEW AGE OF VIDEO Lee Mancini founded the successful SME Sekari. Once he got it up and running, he founded two more start-ups. SME Advisor gets talking to the serial entrepreneur. ZeenV.com is the brainchild of Lee Mancini, who also leads an already established business called Sekari. Lee’s new company specialises in creating, designing and amplifying animated explainer videos. These videos are bite-sized and easy to digest; the idea is to keep things simple. In his early days of working with Sekari, Lee came across an obvious gap in the market. “Working with customers in the Middle East and abroad for over seven years, we knew they wanted high value content in 40+ languages to boost their search engine rankings. We began to realise the power of a well done animation as a communications medium, so we combined our SEO experience with animation to get highvisibility videos. With efficient production processes and a highly talented team of designers and animators, we could produce
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EDITOR’S PICKS 01. Lee Mancini is the founder of ZeenV.com, and has also founded Sekari – a search optimised content marketing agency focused on custom content that increases visibility in search engines. 02. ZeenV.com specialises in creating, designing and amplifying fantastic animated explainer videos. 03. ZeenV is currently looking for an institutional investor to help it expand rapidly into the global market.
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Established: August, 2016
Employees: 4
USP: We are fast and affordable, and provide localised animated explainer video production services Challenge takeaway: Maintain rapid momentum and growth, and be ready to evolve and adapt quickly
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memorable animated videos at extremely affordable prices.” He adds: “Video is by far the most powerful communication medium, partly driven by the rapid rise of mobile penetration throughout the world. Videos being consumed on mobile now account for over half of global watch time. ZeenV.com was a moment of inspiration to create fantastic and impact driven visual communications. Consumers really respond to short videos: after watching a video, 64 per cent of users are more likely to buy a product online. The Middle East is the second largest consumer of YouTube videos in the world, and they are watching absolutely everything, from branded content to television programmes and user-produced comedic viral videos. We wanted to tap into this thirst for content and this new wave of creativity while helping clients reach this growing audience. It became clear there was a space for animated explainer videos, and we wanted to be a market leader.” With a brilliant idea in his pocket, Lee now needed a formula to get the wheels in motion. He started building a team of script writers, designers and animators – tapping into the talent of fresher markets such as Cape Town and South Africa. This was followed by the branding of his new company as well as the creation of its official portal. Ultimately, he was ready to launch his new venture at the Brighton SEO event in the UK in September. Lee’s previous experience as an entrepreneur played a pivotal role in shaping his new business. “From experience, I knew that clever use of technology could make the entire process of planning, ideation, producing, optimising and publishing content far more efficient to both drive down the cost of content and enable marketing teams to publish much higher volumes. With our script writing, design and animation team in Cape Town, we are able to produce high quality animated videos for as little as US$500 for a 30 second video including
voice over, script writing, story boards in any language. And, with our current promotion we are producing 30 second videos for as little as US$250!” Shortly thereafter, customer requests started pouring in and Lee’s team was snowed in with video production projects. Needless to say, he is quite delighted with the outcome. “So far, the results produced by the animated videos are phenomenal. Consumers are constantly bombarded with information, but video is able to break through the noise and engage them while giving them information. The reaction thus far has been incredible, with more brands showing interest and placing orders.” Channelling growth It been only a few months since Lee started building his new company, but he already sees several avenues for growth and expansion. “We just need to be able to expand quickly,” he urges. So, what does he have planned? “ZeenV.com aims to solve the payment challenge, one of the biggest issues international service based businesses face. We will soon launch an integrated online payment system to make the entire process of ordering and paying for your animated video production services extremely simple. We are developing the online payment gateway. A customer workflow management system is also in the pipeline, which will be available also as an app. The idea is to continue identifying ways to make the process even more efficient – allowing us to pass on the benefits to our customers in terms of price.” Content curation is also a major part of his strategy. He explains: “Content marketing has represented a quiet revolution in advertising. Though banner ads haven’t been banished forever, content like blogs, videos, research, and sponsored articles are transforming the way consumers engage with their favourite brands. Investors have started to take note, with venture capitalists
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Using new workflow technology and a tried-and-tested process we can produce high quality animated explainer videos in 22 days extremely cost effectively.
plunging more than US$1 billion into content marketing technology start-ups since 2006, CMO reports. However, many of those companies are in global media hubs like the US and UK, and few specialise in localised content. ZeenV.com plans to change that by becoming an international leader in animated videos. In the process, we’ll create teams of young talented animators in each country and provide a programme for talented underprivileged young people to embark in a career in animation.” “In this digital era, any business can be ‘big’ if it’s clever. With the great tools currently available, great content is within reach of big and small businesses alike. Our mission is to ensure SMEs have access to great content, which can help them reach their customers.” Managing the glitches For Lee, one of the most significant challenges of creating ZeenV.com has been to make sure it was a completely
separate company on its own, with no relation to his other entities such as Sekari. “Although the concept is created by a founding team with SEO experience, it doesn’t compete with the SEO marketers who are working with it directly, and so there are no concerns over conflicts of interest. ZeenV.com’s business model is based on a virtual service offering and for the health of both companies it is imperative that our teams are completely separated from Sekari, but the company itself is benefitting from years of experience running a company in the region and delivering results in search engines.” Funding is another thing keeping him up at night. “ZeenV is currently looking for an institutional investor to help us expand rapidly into the global market,” he admits. But, he’s also confident of his company’s appeal. “ZeenV has a strong regional reputation as well as an international market presence. We tick all the right boxes and are proud to say that we
satisfy the needs of all our clients – giving them the push they need to innovate in a global marketplace.” Future endeavours With a string of successful businesses to his name, Lee is quite the serial entrepreneur. And, he shows no signs of stopping. “In some ways ZeenV.com has gone full circle for me. One of my very first companies launched when I was 20 and was Advertising CD Ltd which later received venture capital funding and became media2b Ltd. At the time, we were producing interactive promotional videos on CD-ROM Business Cards. 20 years later and we are still innovating how we produce and deliver content, and video is as important today as it was then, though the technology has been revolutionised,” he reminisces about his journey. “I’ve always been an entrepreneur at heart – I can’t help it,” he says jokingly. What can we say, Lee? Once an entrepreneur, always an entrepreneur! SME ADVISOR
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YOUR FRIENDLY
APP NEIGHBOURHOOD
Hoodi launched in June 2016. Within the first month, it activated its first neighbourhood with more than 600 members, and two months later it had 3000 friendly neighbours across 19 Dubai neighbourhoods. Samer Bejjani, Founder at Hoodi.co, talks about his company’s exponential growth…
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EDITOR’S PICKS 01. Hoodi took about 10 months to transition from the idea to product stage. 02. Entrepreneurs working on social networks should have a solid strategy to create the network effect; always listen and put the community first.
Established: February, 2016
Employees: 3
USP: The first comprehensive hyperlocal platform that brings neighbourhoods online and connects neighbours in MENA. Challenge takeaway: Being able to bootstrap and implement creative in our strategies, while providing a meaningful value and focusing on growing the business in a limited time.
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s I sit down with Samer, he throws a difficult question at me: “how connected are you with the activities within your neighbourhood?” His question gets me thinking. But even before I can respond, he says: “I am almost sure you aren’t that involved, and such is the case with most people today. In fact, it wasn’t too long ago that I was exactly the same!” Samer was inspired to create Hoodi as a result of his personal experiences within his neighbourhoods. “The idea originated from a personal experience. It started when I heard the fire alarm in my building and had no clue if it was an actual fire or a drill. That got me thinking. I realised that I’m never updated about happenings in my neighbourhood nor in my own building! I figured that all my neighbours are disconnected and in need of a private and secure platform that connects them, helps them be better neighbours, and make the most out of their neighbourhood – especially since they share many common interests, the first being the neighbourhood itself.” Along with his Co-founder Serge, Samer set out on a mission to build his company. They invested their personal savings into the business and began researching. “We put a great amount of time to study our market both in idea stage and prior to launching. It’s important to understand the region and your target audience, screening direct and indirect competition, being up to date with the latest trends, and in our case picking an ideal neighbourhood to launch into. Also, being at Astrolabs exposed us to many mentors that were most definitely helpful. It’s always valuable to listen to someone that has walked the walk, and is looking at your business from a broader angle - great ideas will emerge, and lots of mistakes can be avoided!” Next was creating a quality product. “Being a software engineer, I’ve designed and built most of Hoodi myself, with the
help of some of my trusted friends. Hoodi took us about 10 months to go from the idea to product stage. We launched in June 2016 our first neighbourhood, Jumeirah Lake Towers. We started by inviting as much neighbours as possible. In a couple of weeks we grew into 600 early members. That was a memorable moment, seeing my actual neighbours enjoying the experience, solving their daily life problems, collaborating and providing amazing feedback, and being great neighbours!” Contrary to the conventional method of setting a business revenue model in place, he believes product trumps immediate revenue. “When you build social networks you can’t think on driving any revenue at this stage, our growth should focus on user acquisition, retention, and happiness. Our aim is to bring the entire neighbourhood online, and when we do so we’ll be able to start applying our monetisation strategies. Just like any company should think, we always put our users first. We listen to every feedback and we’ll always do. We organise weekly sessions to discuss how we can improve and serve a better community. Besides that, we make sure that we have an outstanding product that can compete on a global level in terms of user-experience and quality.” Following his product launch, Samer was soon faced with his first real challenge. “The first problem – that I regard as a blessing in disguise – was a slightly sceptical market uptake. Since we are a growing social network, first of its kind in the MENA region, it took people time to get fully on-board with the idea. People tend to disbelieve in the region’s potential, and adopt international solutions, in our case this is also a benefit, we are the region’s first social network designed for neighbourhoods and I am confident that we can expand in the whole region and beyond MENA in no time. Another familiar problem here is the barrier between countries, but since we are a software
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We believe we are in the perfect timing and we’ve proved that Hoodi is a need serving an ultimate cause.
SAMER BEJJANI FOUNDER HOODI
platform, I think this wouldn’t affect our growth as much as other businesses.” He continues: “Like any other start-up you face challenges on a daily basis. Another difficulties I’ve had is balancing time spent building the product, following up with the team and completing all the remaining tasks on the to-do list. I had to work harder, smarter, and most of the times longer, not taking any day off in the entire period, but also having a structured day and respecting the time allowance per activity.” Access to funding Samer talks about his plans for getting finance. “To date, Serge and I are self-funding Hoodi out of our personal savings from our latest jobs. I always believe in bootstrapping until validating the concept, the reason is that you are forced to think outside the box, do a bunch of hacks with a tiny budget in hand. It also proves to investors and partners how resourceful and persistent you are. Since we’ve proven the need and the concept, we started exploring investment options and talking to investors. We aim to close our seed round this December.”
Ahead of the curve Looking to the future, Samer’s short term plan is to be present in all of Dubai’s neighbourhoods. In the long run, he wants to bring all of the region’s neighbourhoods online and help people make the best out of their Hood and be great neighbours! “We will be focusing on Dubai this year, our initial city, while learning from our members and growing our product to provide a unique experience. Next year you will see Hoodi in many other cities. What you see today is our initial version, a lot of exciting features will be implemented gradually such as events nearby, a complete directory of the Hood and much more to be announced at the right time! This comes from listening to our members and reshaping the features as the communities grow. From the results we’ve got so far, I am very optimistic about the future, neighbours are good people and love to collaborate and provide value to their neighbourhood – it’s just that such a solution was missing. We’ll witness an increased sense of community and belonging in thriving communities and neighbourhoods.” SME ADVISOR
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“We aim to create a global company with
A REGIONAL SUCCESS STORY.” In order to solve a serious social problem, you need more than just a fancy theory. You need an innovative business model, a sophisticated platform and the determination to keep going. The fiercely ambitious Thea Myhrvold, Founder and CEO, of teachmenow.com, tells us how she did it all…
EDITOR’S PICKS 01. Thea’s experiences and background have led her to believe that anyone can teach and everyone can learn – she continues to pursue that belief through building teachmenow.com 02. Thea studied International Relations and Economics, with a goal to work for the UN. Through her studies and work, she came to realise that education is where you can have the biggest impact. 03. Teachmenow’s partners also include global companies from Europe, Scandinavia, Middle East, US and Africa.
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ive a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime. This old adage is the first thing that comes to mind when you meet Thea Myhrvold. Her start-up teachmenow.com has set an important benchmark for education: anyone should be able to learn online using basic technological tools no matter where they are in the world. Her technology offers access to online learning in a faster, cheaper and more convenient way, ushering in a new era of education. You could be sitting in Korea learning Arabic from a teacher based out of KSA. Ground breaking? We sure think so. Thea says the platform she has built is a powerful marketplace and facilitates collaboration. It doesn’t just stop there – her team has taken things one step further by setting up a white label version and corporate training solution for schools, institutes and corporates who also want to get online. “For our global marketplace of tutors, we have an amazing and diverse community of Ivy League graduates from places like MIT, LSE, Yale, as well as top certified teachers from around the world. In terms of the corporate solutions, we offer tailored services for corporate training. We solve a lot of logistics and training issues for companies based in this region. Through our global network we can create customised live training sessions for multinationals at a fraction of the cost. This has been a great opportunity for us. Our enterprise and fully customised solutions
allow schools like GEMS Education to create their own online learning platform through our software as well as corporates to use this as a communication and knowledge sharing platform.” “We offer a competitive product, a strong message and brand as well as partnerships. We are built on the cloud and built to scale. Our service offers a flexible platform, live collaboration, motoring, localisation (Arabic language options) and tracking of all data, branding and customisation plus resources and live quality content. We are more than just a software company. This merger between education, tech and teaching has not been seen before. This kind of innovation and synergy allows us to stay ahead of the game,” she remarks proudly. And, rightly so. What Thea has achieved with her business is quite remarkable. Her business is showing positive signs of growth as it expands in terms of users, employees, web footprint and revenue. But, that’s not all. She has a long list of accomplishments to her name. “We launched our corporate and enterprise solution in 2016 and already have 15 paying clients who use our platform with their branding running on the teachmenow.com software. Our clients include GEMS Education, an ISO training company, training for medical professionals, language learning, internal training and collaboration, non-profit work and general education. But, what I regard as our biggest achievement is winning the Global Infiniti speed pitching competition; we were SME ADVISOR
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Established: June 2014
Employees: 09 Year on year growth: We have grown five times since we started. USP: Empowering people to learn and collaborate in real time, in a simple and effective way. Challenge takeaway: When you stop learning and being challenged, you stop growing.
shortlisted as finalists in the Dubai round and went on to win the global competition in Hong Kong. This was an intense competition of at a high calibre, and the total prize was a US$ 40,000 cash injection. There was a lot riding on this competition for us. The best part was coming back from Hong Kong with the massively oversized cheque (now proudly on our wall) and seeing how excited and proud our team was. This helped us also pitch to the CEO of Microsoft, Satya Nadella, in his recent visit to the UAE!” Lessons learnt Thea’s immense success, however, has been tempered by the challenges she’s faced along the way. “There are always challenges. The most important thing is to keep going and know that you and your team will and can find a solution. These challenges are important learning opportunities and you and your team learn and (as cheesy as it sounds) makes your better and stronger. It is being open to change, being open to learn and being persistent. When we started building the portal, it took us several
iterations to get it right. Every time we got it wrong, we learnt what need to be changed. It was a constant battle between perfection and functionality. I would have loved to launch the portal as it is today, but of course it wasn’t practical at that time. After five months of hard work, we were finally able to unveil our beta version - which was a very simplified version of what we have now. We started with a minimal viable product but it took a while to build as nothing like what we wanted to build had been done before. We had a vision for where we wanted to go and needed to get our architecture right in order to scale.” She adds: “So the lesson learnt? Start with the basics – don’t be afraid to launch a semi-ready version of your product. The reality is that you pick up feedback along the way and get to experience the practical nuances first hand. This helps you fine tune the product and improve your offering. Technology is constantly changing so it is important to always be up to date even after you launch a platform or service. There is only so much research you can do before launching something. In the true start-up way, the best thing is to, learn or fail fast and keep improving. Once you have the key metrics in place you need to keep testing and optimising your product.” Breaking barriers – and stereotypes! As a young woman entrepreneur in technology, Thea has definitely taken the path less travelled. Opening up about her experiences of breaking stereotypes, she says: “For me, this was an important reason to come back to the region and create more positive success stories from here. To see change you need to be a part of creating it. That being said there is also a lot of potential to stand out and make a difference both as a woman and as an entrepreneur. There is a great support for female entrepreneurs in Dubai and this is encouraging to see. As a woman in technology, this kind of support is rare and it makes a big difference when this support is truly embedded.”
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My teaching background and passion for making an impact, helped drive my passion and curiosity to create something from scratch
She continues: “Being half Arab, my goal has always been to be a part of the growth and development in the region. As a woman and a teacher, my dream is to contribute to worldwide educational reform, by breaking down barriers to learning and improving how we transfer and understand knowledge. I have lived in many different places, and for me it was important to start something in the Middle East, to challenge the status quo as a female entrepreneur.” Thea’s passion for education accelerated when she started teaching students with learning disabilities. These students faced ADHD and dyslexia, and were in their final year of the IB Diploma. Within a few months of adaptive teaching, the students were receiving above average results! Their teacher was shocked that this had actually worked. During this process, she created games for them and was soon to realise that this was a real hit. “I recognised how modern technology could help streamline this transfer of knowledge in an efficient and simple way. The games that I created for my students, inspired me to develop the world’s
first gamified educational app covering high school material. This continues to inspire me and further my belief that education should and will become more accessible through modern technology. I find that the thirst for knowledge and willingness to learn is universal. We see the sharing economy disrupt industries like transport, hotels and tourism and that is where teachmenow.com aims to make a difference.” Inside her handbook for success The future is bright for Thea as she is very clear about her ultimate goal: to make an impact on the lives of people. “Keep creating value and making an impact. Our vision is to make learning and knowledge sharing accessible through technology. Our short term goals are to become a leader in this Edtech sector and our long term goal is to become the ultimate destination for virtual learning and education. We want to reach millions of teachers and students around the world.” To make this happen, she’s investing a lot of time and effort in continually
evolving her portal. “We are adding more emphasis on corporate and professional training. We will allow companies to buy subscriptions for our trainers on teachmenow.com as well as an added service. We are also adding a one to many broadcasting feature and releasing apps. A marketplace needs critical mass to scale and be profitable. Our marketplace is still our long term strategy,” she explains. The most enjoyable part of our chat with Thea is her ability to say it as it is. With a lot of modesty, she says: “A lot of tech in the education space has been a fad or has been a gimmick. If you want to add value you need look beyond technology and first ask what and how are you adding value, then find the technology to complement that experience as technology will always evolve and change and is more of a facilitator for learning or teaching.” While aspiring entrepreneurs and new start-ups embrace this powerful advice in the hope to build something as disruptive, one thing is certain: Thea’s portal will dominate the industry for the foreseeable future. SME ADVISOR
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TOP TIPS ON CLOUD COMPUTING Andy Brown from KPMG Enterprise Consulting provides a cheat sheet for businesses getting started with cloud computing…
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here’s no doubt that cloud computing has finally come of age. Driven by the demand for speed, flexibility, scale and anywhere access, consumers have fully embraced a cloud-enabled world, while businesses are relying on cloud technology to improve their use of data, develop new products, and improve customer alignment - and not just as a way of saving money. Cloud is not only a transformative solution that helps organisations advance strategic initiatives and achieve strategic goals, but can also be essential to the actual execution of transformation. As organisations undergo change, cloud improves: 1. Rapid scalability: The ability to provision complex infrastructure faster than on premise. 2. Agility: The ability to be more responsive to changing business needs. 3. Functionality: The ability to take advantage of innovation more easily as there is less need to invest in the supporting technology infrastructure.
Of course many organisations still have concerns including data loss and privacy, intellectual property theft and impact on the IT organisation. There has, however, been a pronounced shift from, “Should and how do I move to the cloud?” to “Now that I am in the cloud, how do I make sure that I am making the most of my investment and managing the risks properly?” While this is an issue facing companies both large and small, it’s my belief that change can be harder to drive through in larger organisations than in SMEs, as there are many more stakeholders with potentially entrenched views to convince. Most notable of these is the IT function itself. IT organisations performing a purely technical role of procuring, installing and running hardware will see the cloud as a threat. Whilst it may be pointed out that the cloud will free up valuable IT time and effort to re-focus on driving business change and improvement, not everyone has the skills, aptitude or desire to take on new challenges.
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Cloud adoption should not be viewed as another technology implementation, but as a transformation journey
Already I am seeing some of my clients looking to change their IT leadership from a technical to a business focus to address these sorts of issues. Ultimately, however, I am convinced that we will look back in years to come and laugh at the days when every company had their own servers sitting in a basement tended to and cared for by a team of highlyskilled engineers. So, change is coming and forward-looking organisations should be thinking about how to both utilise the cloud, and tackle the challenges it brings with it. To help, here are KPMG Enterprise’s five top tips to help companies elevate the success levels of their cloud initiatives:
ϭϭ Make cloud transformation a continuous
process. Cloud adoption should not be viewed as another technology implementation, but as a transformation journey.
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ϭϭ Drive cloud transformation from the top. Organisations should seek to manage cloud projects centrally with a senior level team.
ϭϭ Focus on strong leadership and
engagement. Executive management should work to develop the support and buy-in of cross-functional business leaders.
ϭϭ Avoid silos. Business and IT
professionals should work side-byside as cloud is adopted across the enterprise.
ϭϭ Measure success. Organisations should develop realistic and measureable outcomes for their cloud transformation projects that tie back to key business objectives.
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PROFITING FROM THE CLOUD –
HERE’S WHAT YOU NEED TO KNOW Hesham El Komy, Senior Director, Epicor Software, explores the opportunities
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EDITOR’S PICKS 01. The cloud increases the business benefits that ERP offers and can accompany your business on the road to successful growth. 02. Despite the cloud having proven its value beyond just good financial sense, there is no doubt that for companies of all sizes the economics of cloud deployment are undeniably compelling, moving from capital to operational expenditure.
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he reality today is that most enterprise applications are well on their way to being cloud based. We’ve seen it with simple workloads such as HR and payroll, travel and expense management, and in the last decade we’ve seen the cloud as the new normal for customer relationship management (CRM) deployments. In fact, a July 2016 Gartner report predicts that the public cloud services market in the Middle East and North Africa (MENA) region will grow by 18.3 per cent in 2016 to US$879.3 million. More specifically, the cloud application services (SaaS) market is forecasted to grow by a staggering 207 per cent from US$166.1 million in 2015 to US$509.8 million in 2020. So what are the benefits of cloud-based ERP solutions? And, how can your business reap the benefits? Here, we’ve put together eight compelling reasons to explain why moving your ERP system to the cloud will supercharge business growth –
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1. Freedom of choice Put quite simply, not all cloud ERP systems are created equal. Specifically, very few ERP vendors respect your right to choose the deployment model that is most appropriate for you, and revise that decision down the road as your business grows or technical needs change. Your right to transition between on-premises, multi-tenant, and single tenant is an important one. It recognises that the “best” deployment model for you today might not be the best model in a few years, or even a few months. By providing the choice of Multi-Tenant (with its compelling economics and seamless upgrades) or Single Tenant (allowing more administrative control and administrative ownership), you can choose the model that works best for you.
2. Compelling cloud economics Despite the cloud having proven its value beyond just good financial sense, there is no doubt that for companies of all sizes the economics of cloud deployment are undeniably compelling, moving from capital to operational expenditure. Some of the more hidden economic benefits of the cloud include:
• Not being as capital intensive as
an on-premises deployment because of the subscription-based pricing model. • Better and more instant scalability – allowing clients to add (and sometimes remove) users to their system on demand and saving them from having to invest in hardware and software at the “high water mark”.
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• The direct and indirect costs
of your infrastructure, from server to database systems to the actual hardware and replacement cycle cost. • The hidden costs of maintaining the servers yourself. • The benefit of the reduced deployment times (and corresponding improved ROI) that are typical for cloud deployments, as the necessary infrastructure is in place already. 3. Better IT resource utilisation At the end of the day, most IT departments are stretched pretty thin, and find themselves spending too much time on low-value (but admittedly critical) activities such as verifying backups, applying security updates and upgrading the infrastructure upon which your critical systems run. There is tremendous business benefit to assigning those tasks back to your ERP vendor as part of a cloud deployment, freeing up your IT department’s time to work on more strategic business projects such as creating executive dashboards, deploying mobile devices and crafting helpful management reports. 4. The cloud is more secure Today, it’s hard to imagine a client who could possibly create a more secure operating environment than leading cloud providers. Indeed, Gartner reports that “Multi-tenant services are not only highly resistant to attack, but are also a more secure starting point than most traditional in-house implementations.” Security today is a comprehensive, endto-end mindset that has to be built across every layer of the ERP environment from the physical network interface cards to the user passwords. It means a holistic approach to anticipating and minimising possible natural, SME ADVISOR
human, and technical disruptions to your system to ensure uptime and peace of mind. 5. Upgrades Cloud deployment redefines the experience by designing upgrades – big and small – to be deployed by the ERP cloud operations staff as part of standard support services, without imposing software installations on your staff. Minor updates are transparently deployed in a non-disruptive fashion, and major upgrades are announced well in advance, and include a sandbox training environment and end-user training. These major upgrades are designed to require little to no project management on your part, short of double checking that everything is working the way you expect it to and ensuring that your internal users are prepared to take advantage of the new version.
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Opening up your ERP system by virtue of cloud deployment allows you to retire the poorly defined ad-hoc “integration by Excel file” workflows that might have cropped up across your organisation.
in a way that leverages these more open, connected, instantaneous integration paths. 7. Business consistency and process alignment globally Increasingly, companies have staff working across multiple locations and they aspire to provide the efficiency of a single unified ERP system across the enterprise to support them. Deploying a single cloud ERP globally (where the only infrastructure requirement is Internet access) removes many operational obstacles and gives you the confidence that your continued expansion efforts can be accommodated without a significant IT effort by simply enabling that new location in your existing cloud-based ERP system. With consistency comes improved transparency and increased efficiency.
18.3% The rate at which public cloud services market in the MENA region will grow by 18.3% in 2016
us$509.8mn The cloud application services (SaaS) market is forecasted to grow from US$166.1 million in 2015 to US$509.8 million in 2020
6. Mobile and collaborative Moving to a cloud-based system gives everyone the real-time system access they require as a routine part of their jobs, while driving out the inefficiency of paper-based processes and the burden and security risk of figuring out how to deliver this yourself. Opening up your ERP system by virtue of cloud deployment allows you to retire the poorly defined ad-hoc “integration by Excel file� workflows that might have cropped up across your organisation. In their place, you can deploy real-time integration processes that link your employees, suppliers, partners, and customers. Cloud deployment brings the opportunity to redefine many of your legacy business processes and workflows
8. Reduced risk, greater visibility, better value Many clients choose a cloud-based system (ERP and other workflows) because it allows them to deploy a much more complete solution than they could otherwise manage or financially justify under legacy deployment models. Not having to make a massive upfront investment in the ERP system and its supporting infrastructure is critical in allowing smaller companies to perform beyond same-sized competitors from an enterprise application quality and completeness perspective.ERP solutions aren’t just software. They are tools that can be used to help grow your business profitably, offering flexible solutions that provide more accurate information in real-time, driving smarter, faster decisionmaking, and enabling customers to quickly meet changing market demands to stay ahead of their competition. The cloud increases the business benefits that ERP offers and can accompany your business on the road to successful growth.
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LOST IN THE CLOUD
US$107
5.3
billion Estimated industry size in 2017
Zettabytes Global cloud traffic in 2017
1.2 Zettabytes Global cloud traffic in 2012
23.5% IT cloud services compound annual growth rate (CAGR)
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US$47.4 billion Estimated industry size in 2013
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26% 17%
identify cloud cost management as a major challenge
IT product spending for IT cloud services
2/3 of all workloads will be process in the cloud in 2017
1.7 Cloud users are running applications in an average of 1.5 public clouds and 1.7 private clouds
31% Private cloud showed strong growth with 31% of enterprises running more than 1,000 VMs
7% of businesses have more than 1,000 VMs in public cloud
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YOUR DIGITAL
CHECKLIST Digitalisation can be a rollercoaster ride for growing enterprises, but Savita Raina of SAP puts together a checklist that covers all aspects and advises on the way forward...
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igitalisation is the single most talkedabout topic among business leaders in all tech and non-tech companies— including small, midsized, and large companies, in all industries and all lines of businesses. Why? The reason is very simple: Digitalisation is converging all technologies, from cloudbased IT, mobile, and the Internet of Things (IoT) to Big Data. Digitalisation is driving the next digital revolution and leading to a new wave of productivity. Old business models are being shattered, with disruption driving new innovation, new ways of thinking through problems and new solutions. Let’s take a look at some of the implications this disruption is bringing.
The demise of old business models and the birth of new ones Uber and Airbnb are two well-known companies that are already riding the digital transformation disruption wave. With only access to handheld smartphones, every car owner or homeowner today can provide a service by sharing their car or home to generate revenue. Both are perfect examples of how disruptive digital business models are paving the way for revenue generation, great customer service delivery, and consumer value. Both are eroding the business of traditional service providers such as taxis and hotels. In the automotive industry, connected cars are another form of digital disruption.
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Without the digital revolution, leveraging data to extend business capabilities would have been impossible
As consumers expect and demand to be constantly connected, new players are entering the automotive market. Software companies, financial institutions such as credit card companies, and telecommunication companies are transforming the industry and changing its landscape. Automotive companies must either share their profits with these new entrants, build solid internal capabilities to challenge them, or collaborate with them quickly and strategically to create the value today’s consumer demands. Every company is a tech company In previous years, there has been a clear distinction between what tech companies and non-tech companies do. But with access to supercomputing and aligned technologies such as Big Data, mobile, deep data analytics, and cheap commodity hardware, non-tech SME ADVISOR
companies can now leverage data to make more informed business decisions. With access to historic and real-time data, companies can upsell and cross-sell to customers and use data to deliver better customer service. Retail giants such as Walmart, Caterpillar, and many other traditional non-tech companies are becoming tech companies as they sit on tons of data, which they can leverage to build business and provide added value to customers. Without the digital revolution, leveraging data to extend business capabilities would have been impossible. Data privacy: a major concern Recent data breaches at government institutions such as the FBI, retail giants such as Target, and electronics and media companies such as Sony are
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raising concerns. So, too, is increasing governing agency oversight on the dayto-day lives of American citizens. This changing environment makes companies and individuals rethink their data privacy approaches. With every aspect of our lives digitalised, there are major concerns that our precious personal data could be misused by authorised or unauthorised entities. It has become more and more important for businesses, government agencies, and non-profit institutions to safeguard and secure the personal data of individuals from unwarranted harassment and violations of personal freedoms and liberties. While digitalising aspects of their lives has advantages for many people, the risk of data misuse will continue to be a major concern.
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While digitalising aspects of their lives has advantages for many people, the risk of data misuse will continue to be a major concern
CIOs can lead by driving change With all the possible implications of digitalisation and the digital revolution, CIOs can play a key role in driving change by smoothing this transition for their organisations. As technology experts with sound understating of information systems and business processes, CIOs can lead the way by collaborating with other C-suite executives in understanding their needs and translating those needs into business outcomes that can add new capabilities and impact enterprise-wide competitiveness. By participating actively in driving this enterprise-wide change, CIOs can help build new business models for tech and non-tech companies alike. By collaborating and working hand-in-hand with other C-suite executives, CIOs can diffuse the conflict created by departmental silos and differences in departmental objectives. With a focus on data security, privacy, and data stewardship, CIOs can pave the way for new-age enterprises that leverage data to deliver great customer value and improve the bottom line. SME ADVISOR
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THE GROWING THREAT OF CYBER RISK Organisations are increasingly under attack from cybercriminals and hackers. Business owners need to be better prepared and set strict mechanisms in place to protect themselves, says Rob Cotton, CEO, NCC Group.
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It’s no secret that cyber risk is the greatest threat to modern business. It seems that not a week goes by without a headline in the mainstream press about a company being hacked or an expert claiming the cost of cybercrime to the global economy is either billions or trillions of pounds. And most businesses are yet to truly understand and own the risk. Boards educate themselves on the likes of audit and health & safety, but seem to assume that cyber threats should be a risk owned by someone with a technical skillset. However, when you look at the damage – both monetary and reputational – a compromise can cause an organisation, it becomes clear that ignorance of the risk could amount to negligence on behalf of the board.
This year alone we’ve seen an attack on the Central Bank of Bangladesh which resulted in losses of US$81 million (£66.2 million), as well as data breaches at a number of other businesses both big and small. A robust defence strategy is crucial, but what effective defence looks like has changed over the years. Historically security teams focused on using the likes of antivirus software to identify known threats present on the network. But cyber criminals have evolved their methods quickly and most successful attacks feature unknown malware, which anti-virus cannot spot. Nowadays cyber criminals often target employees, posing as a reputable source in order to trick them into clicking on malicious links in e-mails or opening attachments. All
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EDITOR’S PICKS 01. A robust defence strategy is crucial, but what effective defence looks like has changed over the years. 02. Organised criminal gangs are expected to be the first to target vehicles as a means of making money through ransomware attacks or stealing financial data. 03. Even connected cars must be taken into account when it comes to cyber risk.
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in all, it’s impossible to simply fend off every attack. Some will get through and a modern cyber defence strategy needs to take this into account and plan accordingly. The best approach is to promote cyber resilience. This means accepting that cyber incidents will happen and being ready to respond when a breach occurs or is detected. This allows organisations to understand the best course of action to take in order to return to business-as-usual. It’s not just the typical corporate environment of servers, laptops and desktops that is at risk either. The growing number of individual devices now connected to the Internet – known collectively as the Internet of Things (IoT) – pose a significant threat both inside and outside of the office. Internet-connected printers might make things slightly quicker on a day-to-day basis, but they also provide another point of entry for cyber criminals to enter a network.
Even connected cars must be taken into account when it comes to cyber risk. Everyone is used to apps on their mobile phones and now people expect to have access to the same apps when they’re in their car as they do at home or anywhere else. They expect to be able to stream media over the Internet, rather than having a pile of CDs in the car, and to have Wi-Fi available too, so they can pick up e-mails and passengers can play online games. We’re also starting to see more adoption of other convenience features such as remote keyless entry. There are other sectors which are driving developments in the automotive space as well, including the insurance industry which uses telematics data for premiums, and breakdown companies which can use location information to identify where vehicles are. We’re even seeing the concept of just-in-time parts ordering emerge, where a car can alert a local dealership if a particular component is wearing out, and the dealership can ensure it has one in stock before contacting the customer. Yet with this growing use of connected incar technology comes the threat of attack, either from cyber-criminals or those intent on causing disruption. Organised criminal gangs are expected to be the first to target vehicles as a means of making money through ransomware attacks or stealing financial data. Another major concern is the storage of payment card details and personally identifiable information on such devices. Vehicle systems could also potentially provide unauthorised access to other services, for instance warehousing and fulfilment arms of ecommerce operations, without the right security provisions. The overarching problem with IoT is that many embedded devices were developed as standalone units, with no intention of one day being connected to the Internet or other networks and often do not employ the same security practices as a connected system
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The overarching problem with IoT is that many embedded devices were developed as standalone units, with no intention of one day being connected to the Internet or other networks and often do not employ the same security practices as a connected system would have.
would have. The Gulf Cooperation Council (GCC) is focused on becoming a ‘smart society’ and this is a laudable aim, but it must take these risks into account. On the subject of businesses specifically, in order to properly address the growing cyber threat boards must take ownership of the risk. It should be managed with the same vigour and transparency as audit, remuneration, health & safety and CSR. All directors must be fully accountable and a lack of understanding or knowledge is not an adequate excuse. It is no longer acceptable for cyber security to be passed down to an IT director or risk manager. It is the responsibility of the CEO and the main board as it is the most significant issue facing businesses today. At NCC Group we have decided to practice what we preach and have created a Cyber Security Committee which is led by our Senior Independent Non-Executive Director. With the ever rising risk of cyberattacks, we believe that all listed companies should have a board-led Cyber Security Committee. SME ADVISOR
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ARTIFICIAL INTELLIGENCE THE FUTURE IS HERE With Artificial Intelligence finally taking off Jolie Huang, Research Senior Analyst, Accenture Technology Vision, assesses the implications it will have on business, employment and our overall state of living.
L JOLIE HUANG RESEARCH SENIOR ANALYST ACENTURE TECHNOLOGY VISION
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ooking for a restaurant nearby? Ask Marsbot, a bot that learns about the types of places you like to go and texts you with suggestions for nearby eateries you might enjoy.i Feeling under the weather? Speak with a chatbot named Your.MD, powered by an Artificial Intelligence (AI) engine that guides you to better treatment.ii Rather than poking at a smartphone and simply using technology to complete a task, humans will have conversations with technology. “In the long run, I think we will evolve in computing from a mobile-first to an AI-first world,” said Google CEO Sundar Pichai on Alphabet’s Q1 earnings call.iii Research from Ericsson’s ConsumerLab indicates that within five years, Artificial Intelligence will enable interactions without requiring a
screen.iv This will be a game changer, solving a critical user experience problem: Users are tired of operating multiple apps and dealing with lengthy click-through sequences in order to complete simple tasks. Without question, people are ready to embrace the simplicity of interacting with intelligent virtual assistants. You can ask Alexa to play workout music without having to name exact songs or artists, or chat with Quartz, a news app, to learn about the latest trending headlines with your morning coffee.v How are these experiences so seamless? Advances in machine learning algorithms power better recommendations, and improved speech recognition makes intelligent agents better at understanding the words you’re saying. Coupled with
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Advances in machine learning algorithms power better recommendations, and improved speech recognition makes intelligent agents better at understanding the words you’re saying.
55% plan on using machine learning and embedded artificial intelligence
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advances in natural language processing, knowledge representation, and information retrieval, and bots can engage in natural conversations with users while improving the accuracy of their responses. Together, these are the capabilities letting a virtual layer stitch together fragmented channels and deliver them through conversational interfaces. Real-life usage reflects the improvements that have been made. Since the beginning of last year, the number of voice interactions has tripled across all products from Baidu, the dominant Chinese internet search engine company who also invested heavily in developing AI technologies.vi Similarly, a full 20 per cent of queries on Google’s mobile app and on Android devices are voice searches.vii Disrupting the traditional workplace People are clearly ready for AI-powered conversational interfaces, and soon they will become the norm for how we interact with
technology in the workplace as well. Travel agents at Pana embrace working side-byside with AI assistants.viii Their AI system parses traveller information and analyses natural language to provide intelligent travel choices for customers. The result? Agents are able to focus their energy on the more unique nuances of travel planning, and customers are clamoring for a chance to try the new way to book travel. And while asset-heavy companies already employ industrial robots to automate assembly lines, asset-light entities will soon deploy virtual assistants throughout the workplace, letting humans work smarter. This AI enthusiasm is a global phenomenon. 70 per cent of business and IT executives who participated in the Technology Vision 2016 Survey are already making significantly more investment in AI-related technologies than they were two years ago, and 55 per cent said they plan on using machine learning and embedded
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artificial intelligence. Global AI equity funding surpassed US$6.6B across 1,241 deals from 2011 to Q1 2016. And equity financing for the AI space has gone from US$282M in 2011 to US$2.4B in 2015, an increase of more than 700 per cent in just five years.ix “2016 will be the year of conversational commerce,” according to Chris Messina, Developer Experience Lead at Uber.x Companies must rethink the way they interact with their customers and take an active role to engage with them differently. Having a HAL-9000 run your business may appear too futuristic, but it’s happening with real-world technology. Businesses are building chatbots on Facebook Messenger and Slack to push direct messages to customers via existing platforms and services, and they’re leveraging standalone virtual assistants like Accenture’s myWizard to help employees with software testing and data analysis. As the wave of
conversational interfaces takes speed, companies must initiate pilots of these new types of experiences with their customers and employees. Intelligent assistants are a small step in the direction of intelligent applications, but a giant leap for the future of human interaction with technology. Today, people talk to each other – tomorrow, we’ll be talking with machines.
References: i. https://marsbotapp.com/ ii. http://www.enterpriseinnovation.net/article/aipowered-personal-health-assistant-unveils-onestophealth-1729643100 iii. http://www.businessinsider.com/sundar-pichai-aifirst-world-2016-4 iv. http://www.ericsson.com/res/docs/2015/ consumerlab/ericsson-consumerlab-10-hotconsumer-trends-2016-report.pdf v. http://qz.com/613700/its-here-quartzs-first-newsapp-for-iphone/ vi. http://www.bloomberg.com/news/ videos/2016-05-23/baidu-s-ambitions-in-voice-tech vii.http://thrivesearch.com/google-says-20-percentmobile-queries-voice-searches/ viii https://pana.com/ ix. CB Insights - AI Investment Landscape Webinar Slides - June 2016, slide 18 x. https://medium.com/chris-messina/2016will-be-the-year-of-conversational-commerce1586e85e3991#.decf2hnf6
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What a spectacle!
ESTIMATED PRICE: US$ 130 SOURCE: WWW.SNAP.COM
THE PRODUCT: THE SPECTACLES ARE A PAIR OF SUNGLASSES THAT HAVE AN INTEGRATED VIDEO CAMERA – LAUNCHED BY SNAP INC. (THE COMPANY BEHIND THE SOCIAL NETWORKING APP SNAPCHAT).
INFO ON THE LAUNCH: THE FUN PAIR OF SUNGLASSES ARE AVAILABLE IN THREE DIFFERENT COLOURS AND WILL BE LAUNCHED SOON.
ITS FUNCTIONS: THE SUNGLASSES HAS ONE OF THE SMALLEST WIRELESS VIDEO CAMERAS IN THE WORLD THAT IS CAPABLE OF TAKING A DAY’S WORTH OF SNAPS ON A SINGLE CHARGE. SPECTACLES CONNECT DIRECTLY TO SNAPCHAT VIA BLUETOOTH OR WI-FI – TRANSFERRING YOUR MEMORIES DIRECTLY INTO THE APP. THE CIRCULAR VIDEO PLAYS FULL SCREEN ON ANY DEVICE, IN ANY ORIENTATION AND CAPTURES THE HUMAN PERSPECTIVE WITH A 115 DEGREE FIELD OF VIEW.
IMPACT ON THE MARKET: SEVERAL EYE WEARABLES HAVE BEEN INTRODUCED TO THE MARKET AND HAVE FAILED TO MAKE A LASTING IMPRESSION. THESE SPECTACLES STAND TO CREATE A STIR BECAUSE OF THEIR SIMPLICITY AND AFFORDABILITY. A CLASSIC EXAMPLE OF LESS IS MORE.
ITS LIMITATIONS: SELFIE- FANS MIGHT BE DISAPPOINTED, BUT THE SPECTACLES ARE ONLY ABLE TO CAPTURE OUTWARD FACING IMAGES. SO USERS CAN CLICK IMAGES OF OTHERS WHILE WEARING THEM – NOT OF THEMSELVES.
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