Saudi Aramco World: May/June 2014 - page 24

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Saudi Aramco World
With no streetlights and its row of abandoned late-Ottoman-
era buildings, the Beirut neighborhood of Khandaq al-Ghamiq
seems to live up to its Arabic name, “the dark ditch.” It is home
to some of the city’s poorest residents, many displaced by war,
squatting for decades in crumbling, shell-pierced dwellings.
But on a recent evening in March, the Khandaq was lit up with
a bright white party tent. Valets lined up outside and Arabic beats
pulsated from within. Inside, amid a cacophony of excited conver-
sations, a hip young Lebanese band remixed traditional melodies
while Beirut’s finest restaurants served up steaks imported from
Australia, gourmet Black Angus burgers and artisan cold-press
juices. The attendees were smartly dressed in “dotcom casual”—
suits open to ironic T-shirts, Converse sneakers and jeans—many
still wearing bright yellow lanyards branded “ArabNet.”
The three-day conference, now in its fifth year, is one of the
largest gatherings of the Middle East’s budding startup industry,
and tonight’s dinner was one of the many afterparties where the
region’s future business leaders get to network and capitalize on
a regional e-commerce market that will be worth $15 billion by
2015, according to estimates by PayPal.
If all goes according to plan, much of the shrapnel-scarred
Khandaq area will be transformed too, into the Beirut Digital Dis-
trict, a 10-year initiative to build some 10 high-rises that planners
hope will house the new industry just a few blocks from the lux-
ury glass-and-steel residential towers now going up in downtown
Beirut. Subsidized Wi-Fi and fiber optic cables are expected to
flow freely throughout the area, which aims to rival similar new
regional facilities like Oasis500 in Jordan or Flat6Labs in Egypt,
which have been hosting, training and investing in hundreds of
tech-based startups, buoyed by millions of dollars in new venture
capital funds that are cropping up across the region.
Hours before the party, a scale model of the Digital District
was on display at ArabNet, held in a sprawling banquet hall in
Beirut’s newest Hilton hotel. With the backdrop of a 14-meter
(45') electronic display, dozens of young, aspiring entrepreneurs
from across the Arab world took to the stage to deliver two-
minute “Ideathon” pitches with infomercial-like zeal to the
crowd of some 600
professionals. More-established
were also on hand, speaking at panels covering everything from
social-media marketing to venture-capital opportunities to forg-
ing links with Silicon Valley. There was a brief discussion of Bit-
coin, as well as corporate social responsibility, better known by
its industry buzzword,
“Why do
?” asked twenty-something digital-media strate-
gist Ralf Aoun as he paced the stage with a headset microphone.
“It’s good for business, good for
and good for karma!”
But what about regional turmoil, asked moderator and in-
dustry veteran Mike Butcher, who was making his third visit
to ArabNet as editor of
, one of the world’s most
popular technology news sites. He put the question also to
co-panelist Stephanie Holden, formerly of Priceline and Walt
Disney and now the head of Saudi-owned television giant
investment arm,
Ventures. Touting her firm’s investments in
nine Arab startups, she said regional entrepreneurs faced more
of a threat from government bureaucracy than armed violence.
Butcher himself had come to a similar—if blunter—conclusion
the previous evening at another off-ArabNet event.
“Amid everything going on, you guys are still kicking ass,” he
said to cheers from an audience that had gathered at Coworking
961, yet another technology incubator space in Beirut. Butcher
had been one of the judges at a pitching contest at the space,
which occupies the guesthouse of a 19th-century palace. Under
its castle-like turrets, the representatives of young Lebanese
firms had presented their ideas on a projection screen in the gar-
den, a rare patch of lush greenery in the exhaust-choked city.
The winners that evening were the developers behind Roadie
Tuner, a handheld piece of hardware that tunes guitars and other
stringed instruments. It was born out of the frustration faced by
27-year-old engineer Bassam Jalgha while tuning his
, or Arab
lute. In 2009, Jalgha had entered and won the
show for innovators, “Stars of Science,” walking away with a
check for $300,000 from the Qatar Foundation. He would later
team up with friend, fellow engineer and flute player Hassane
Slaibi and launch a Kickstarter crowdfunding campaign that net-
See interviews with Arab entrepreneurs
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