Entrepreneurial ventures


Entrepreneurship is flourishing in the Middle East despite economic problems and challenging political and security conditions. Furthermore, the advent of low oil prices has created a window of opportunity for the development of private enterprise and the creation of sustainable business. Young entrepreneurs are ready to take risks and create their own start-ups, which provide new jobs and improve the economy.
This book focuses on entrepreneurship in different Arab countries, including Egypt, Morocco, Saudi Arabia and the United Arab Emirates (UAE). It covers a variety of businesses related to manufacturing, telecommunications, food service and banking.
Young entrepreneurs and the companies they are establishing have a positive impact that can change the region for the better. They have created new products, and are offering new jobs in countries suffering from slow growth and high unemployment, especially among the youth.
Maha Mourad and Laura Guindy write about Bey2ollak, one of the most interesting case studies in the book. It is a crowd-sourced traffic app for smartphones based in Egypt. It started one evening when a young man, Gamal, was in discussion with his cousin Ali. They decided to create something. They had both studied computer science, so obviously it would be a tech start-up. Four friends joined them, and they soon came up with Bey2ollak, which means “it tells you” in Arabic.
The app enables users to check the amount of traffic at any time and choose alternative routes. Bey2ollak has been generating money via application sponsorship from Vodafone, Pepsi and Shell. It has an office with 25 employees in Maadi, a residential area in Cairo.
Bey2ollak began operations on Oct. 10, 2010, three months before the Arab Spring. During the revolution, the lack of security increased the need to know where there were demonstrations, roadblocks or any other unexpected event affecting traffic.
Bey2ollak proved it was quick to respond to problems and offer practical solutions. When Egypt suffered from repeated fuel shortages, the app immediately created a new section with a list and location of fuel stations, and during the elections it provided a list of polling stations.
Bey2ollak initially expected to serve a restricted social class between the ages of 25 and 35. They were pleasantly surprised to find that an increasing number of people outside their initial target market had been reached, because Egyptians like to buy second-hand cars and smartphones. A large number of Egyptians from the middle to lower-middle classes now have access to second-hand, expensive smartphones, which increases the customer base.
“Bey2ollak basically had everything they needed in their team. They had the designers, the business people, and the tech people,” write Mourad and Guindy.”
“They also didn’t need any advertising as they used social media and their families and friends to spread the word. There was barely any start-up capital needed; all they needed to invest at first was their own time.”
Bey2ollak has more than 1 million registered users, 3 million Facebook fans and 130,000 Twitter followers. But can it maintain its market position and attract more customers? And are other countries inside or even outside the Middle East interested in this app?
The role of ICD
Ali Soliman, professor of economics at the British University in Egypt, familiarizes us with the Islamic Corporation for the Development of the Private Sector (ICD), a subsidiary of the Islamic Development Bank (IDB), founded in 1999 and based in Jeddah. The ICD provides solely Shariah-compliant finance to encourage the economic development of its member countries by promoting the establishment of private enterprises.
“During the last four decades, Islamic banking and finance have witnessed phenomenal growth worldwide,” writes Soliman. “Globally, the annual growth rate exceeds 15 percent per year. In some countries in the Middle East and Asia, it is accepted as the foremost alternative banking option for millions of customers.”
It can be said the ICD has helped some of the least-developed countries such as Sudan, Yemen and Pakistan, and countries suffering from a shortage of foreign currency such as Azerbaijan and Syria. It has supported the textile industry in Syria and Uzbekistan, and financed IT start-up revenues.
The Moroccan experience
Abdelrahman Hassi, Khaoula Zitouni and Omar Bacadi tell the story of Abdelkader El-Mouaziz, a renowned award-winning Moroccan marathon athlete. When El-Mouaziz was running for the Moroccan national team, he used to train in the mountainous region of Ifrane-Azrou. When he retired from competition, he decided to settle down there. He wanted to give back to the region that had helped him become a sporting legend.
He decided to establish a business that would offer job opportunities to local people. In March 2010, he opened a small hotel called Tourtite, which means “garden” in the Berber language. Tourtite provides customized training programs supervised by El-Mouaziz himself. He runs his business according to the same principles he followed during his athletic career: Fair play, competitiveness, perseverance, hard work and collaboration.
“For some entrepreneurs, making money is a means to becoming rich; that’s not my motivation for starting a business!” he says. “I love helping others to accomplish their desired goals. Money should not be the main goal of an entrepreneur; when we work hard, money will come automatically!”
Baraka Optics
Other cases presented in this book include a study of the reputable Egyptian chain Baraka Optics. In the aftermath of the Egyptian revolution, sales dropped and the company faced serious problems. But Baraka’s CEO Ahmed Raga implemented a new marketing and sales strategy, and was able to steer it back onto a winning track.
This book shares the experiences of 10 entrepreneurial ventures, highlighting their innovative approaches and practices. It highlights the importance of encouraging young people to create their own businesses and provide job opportunities. Youth unemployment in the Arab world is close to 24 percent, nearly double the world average and the highest regional youth unemployment rate in the world.
“A well-directed entrepreneurship ecosystem appertaining to innovation and creativity is crucial in providing a sustainable solution for the region’s most pressing challenge: youth unemployment,” concludes Karim Seghir, dean of the School of Business at the American University in Cairo.