Saudi Aramco World: May/June 2014 - page 27

May/June 2014
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With its colorful wall murals, futuristic furniture and even
an adult slide that spirals through a large atrium, the Oasis
building in Amman is every bit the dotcom space one would
expect. In addition to providing coaching and co-working office
space for young firms, Oasis has a $6 million fund from which
it invests up to $30,000 in startups in exchange for a 10 to 20
percent ownership stake.
So far, Oasis has invested in 70 startups and trained an ad-
ditional 1500 entrepreneurs through its monthly “bootcamp”
workshops, according to the investment manager Salwa Kat-
khuda. One of its first successful exits has been the online sports
retailer Run2sport, which sold a majority of its stock for $2.5
million to Toukan’s Souq.com. Another Jordanian startup,
online-payment gateway Madfoo3atCom, raised more than
$500,000 from private investors. Both deals took place in 2012
and Katkhuda says Oasis is now expanding into the United
Arab Emirates (
UAE
) and Saudi Arabia.
“We are at the very beginning of an entrepreneurial era in the
region, but it will take a long time for the market to mature,”
she says. “The early players have a huge advantage and oppor-
tunity by being the first risk-takers.”
Prominent among those early risk-takers is Ahmed Alfi, who
after nearly two decades as a media and technology investor in
Los Angeles returned in 2006 to his native Egypt to launch one
of the region’s first venture capital funds. In 2011, he opened
Flat6Labs, which offers services for startups similar to those of-
fered by Oasis500. So far it has graduated 36 companies, and it
offers facilities and loans from $10,000 to $15,000 in exchange
for 10 to 15 percent ownership.
“There’s quite a few breakthroughs that will happen this year,”
Alfi says from Cairo, where he is busy giving a tour of the facil-
ity. “A lot of companies are on the cusp.”
Among the Flat6Labs success stories is Instabug, an applica-
tion that helps developers find and report programming bugs
through physically shaking a mobile device. Developed by a
pair of Egyptian 22-year-olds, the app was partially funded by a
Kickstarter campaign
that surpassed its goal
of $10,000 within
hours, raising a total
of $85,000 and now celebrating its millionth download. Then
there is 1Sheeld, a device that can help automate objects and
appliances, which won the audience-choice award at last year’s
TechCrunch Europe Disrupt event, and Kngine, which Alfi says
is similar to Apple’s automated voice assistant, Siri.
“We are finally getting outside firms interested,” he says, nam-
ing Samsung Ventures and Vodafone Ventures as parties negoti-
ating potential deals.
Following on the success of Flat6Labs, Alfi is now expand-
ing. He is building Egypt’s largest technology park by convert-
ing nearly an entire city block of buildings
that were formerly
used by the American University of Cairo. Known as “Greek
Campus”—which comes from its original use as schools for
Greek expatriates—Flat6Labs has already attracted 20 com-
panies that have moved into one building, while four more
buildings are planned to open this summer with the goal of
attracting hundreds of companies and creating some 3000 jobs.
Alfi says the word is getting around quickly.
“People were coming up to us when we were moving in, as we
were doing construction. Eighty percent of the companies I had
never heard of before. These are not even people who knew me,”
he says excitedly. “These are people who wanted to be part of
the community.”
The idea is to create a campus environment, where innova-
tion and talent can spread quickly, which has been a major
challenge for the Arab tech industry. “Everybody knows my
main goal is collaboration, and collaboration will accelerate the
development of the tech sector,” Alfi says. “Networking is one
of the major missing components. If you are building something
and you meet somebody who has already made subcomponents,
you can collaborate. Networking is an educational tool to learn
what other people are doing. Networking helps create teams
faster to attack problems faster.”
But once teams are built, regional entrepreneurs, particu-
larly in a place like Cairo, face the additional challenge of
turning profits in a region with generally high unemployment,
low per-capita incomes and low levels of disposable income.
Swimmer and
engineer Hind Hobeika,
26, invented high-tech
swim goggles, called
Instabeat, that allow
swimmers to track
their heart rates
throughout each
workout.
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