Interview on UMen about the Entrepreneurship ecosystem and landscape in the Middle East

1. FEATURE ExposUrE
Enter
Entrepreneurship
By Oula Farawati
Dealing with frustration is key to success. Habib Haddad, a
Lebanese entrepreneur found out that dealing with the frustration
of others could also mean business. He, along with Lebanese
partner, Imad Jureidini, founded Yamli, a transliteration tool
now used by millions around the world to transliterate Arabic
words written in Latin characters into meaningful Arabic. U MEN
met with the young businessman for a full-fledged look into
the entrepreneurial landscape in the Arab World and advice for
creating the environment that is conducive to start-up and small
businesses.
Q: Can you tell us a little the business. I want readers
about Yamli? to read about bacteria in
A: Yamli is now a two-and-a- Arabic for example. Second,
half-year-old startup that was the Arabic language is
founded in Boston focusing endangered; actually the UN
on Arabic language online predicted that in 50 years,
to empower Arab users to Arabic language will start to
access content and contribute fade out if nothing is done to
to it. The first problem we increase content and usage.
set out to solve was typing. From an entrepreneurial
Ironically, the majority of and business perspective,
Arabic users don't know how it is also very important to
to type in Arabic and type have Arabic content online
instead in English or French. because it will be easier in
We empower Arabic content that case to build companies
online by allowing users on it. Let me give you an
to benefit from a skill they example: If I want to build
already know; thus translating a site that has location
gibberish into proper Arabic. information like foursquare.
Consequently, this will enlarge com, and a user wants to
Arabic content by allowing find a restaurant around a
users to blog and contribute certain place, this kind of
to forums. content does not exist, even
Q: This is the mantra in English. So if I want to
that almost all tech build a company that offers
entrepreneurs are singing location information, it will
these days; everyone has be very hard and expensive
some logic for it. What is because then I should start
yours? with creating this kind of
A: Actually the benefit is information; whereas in
three-fold. First of all, there the US for example, the
is a benefit for the direct information is already there
consumer; the reader, and all I need is to license it
second the culture and third very easily and cheaply.
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2. Q: How does all this talk the Internet. However, even Although a much better concepts in the region.
about content translate into in those cases, it is only way of startup financing is Meydan is one example
cash? when governments liberalize the one that adds value – of a TechStars model that
A: When Yamli is concerned, the base layers that creativity angel investors and venture launched in Jordan a few
we have an advertising starts to take place on top of capitals – banks remain months ago.
medium. And our second them. one of the first financing Q: You also warned against
source of income is "emulating" silicon Valley.
enterprise products which
we are building, including
'If you look at the space In Why?
a search enterprise. So if a the MIddle east and why A: Who is the Silicon Valley
to come and teach us in
company like Emirates wants people prefer jobs, the Middle East about our
to use a search engine in
Arabic, the existing solutions it is not because of advantages? We should
focus on finding our own
are very poor. Today, we
are leveraging our intelligent lack of ambition, competitive edge. Taiwan
for example, was able
expertise to build a search but because It Is to first position itself as
engine that enterprises, such
as bayt.com or souq.com very expensive to a hub of semiconductor
manufacturing and it actually
can use. These companies
won't build their search
start a venture did so by leveraging its
engines from scratch but and faIl' competitive advantage: The
Taiwanese Diaspora is now
actually use the ones that we working in tech companies
develop. Governments should try destinations for young in Silicon Valley. Rwanda
Q: Lets shift gears here; to lower the cost of failure, Lebanese entrepreneurs, is another example of how
you as entrepreneur. Upon making sure that opening but having collateral assets government was able to
graduating from university, and liquidating a company is is not always easy, so many make a transformational
many are tempted into done easily; access to capital end up abandoning their change. In just a few years
settling for a 9-to-5 job should be easier by easing projects. Relaxing those after the 1990 genocide,
as not go through the laws and regulations on regulations and putting tax Rwanda ranked 67 in the
hassles and the failures of banks. Education is also key; incentives on banks and World Bank “ease of doing
setting up a startup. Why there should be emphasis wealthy individuals to invest business” index ahead
did you decide to be an in academia on instilling in human capital would of many Arab countries.
entrepreneur? the entrepreneurial spirit in lower the cost of financing Rwanda also focused on its
A: Personally, I am much students at the university and therefore, allow competitive edge, and in this
more into challenges and level. If governments focus, recipients to focus on what case it was coffee. Now that
putting myself out of my in their own capacities, on they do best. Rwandan coffee is selling
comfort zone to face these setting channels that lower Q: on your blog, you at a premium price on US
challenges, and basically, the cost of failure then advised against incubators shelves, it has created an
dream big. I was fortunate to step aside, it could have a not turning into "real estate entrepreneurial revolution
be based in an environment tremendous trickle-down projects". Why is that? back home. Businesses,
that fosters innovation and effect on innovation. Think A: While I am a big fan of including technology
allows me to take risks about it this way, it’s not the mentorship and truly believe oriented ones, are emerging
and not worry a lot about rate of failure that matters, it can add tangible value, to serve this industry.
failures. If you look at the it’s the cost – time and I am not sure traditional Q: Do you think the
space in the Middle East money – and associated risk incubators are the answer. opportunities are really huge,
and why people prefer jobs, that would be problematic. Those risk becoming real or is this just media hype?
it is not because of lack of As Scott Anthony, a frequent estate projects can lose the A: The Middle East and
ambition, but because it is writer on the subject energetic culture that they North Africa region is home
very expensive to start a puts it: “The only way to were set to create in the first to 350 million Arabic native
venture and fail. The cost successfully innovate is to place. Great entrepreneurs speakers, 65% of whom are
of failure is very high. If you be prepared to iterate like would want to tap into the under the age of 30. While
fail here you are doomed crazy”. With a low cost of contacts that the incubators internet penetration is still
financially and socially. failure, one has leeway to provide but would graduate low at 20% it’s growing
Q: What is the role of iterate a number of times when the right time comes. at the fastest rate in the
governments in that regard? and increase the chance of The program/mentorship world. Mobile penetration
A: Although the “fail fast, successfully innovating. incubators that were however is at 80%, with
fail cheap” mantra is Q: Banks remain a problem pioneered by the likes of about 220 million users. The
mostly taken in regards though despite all these YCombinator and TechStars education and healthcare
to internet businesses, developments… could work well but it’s sectors are booming due to
it also does apply to all A: Yes. Another important important to not forget that the fast population growth.
industries. Obviously, some area that could lower the the MENA is no Silicon This growth, coupled
governments can afford to cost of failure is access Valley [The part of the US with the wealth of some
take a very proactive role to capital. Regulations known for its high number countries especially in the
to spur innovation, like with imposed on bank lending of high-tech businesses in Gulf, is creating significant
the tons of money spent on to businesses require the area], so we should be opportunities that are yet to
military research that got us having collateral assets. careful when adapting those be explored.
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