Technology has placed the Middle East on the cusp of an entrepreneurial boom
“We have this phenomenon in the Levant where self-made businessmen usually show their gratitude to the community by building a mosque. For me, I’d rather see them invest in young Arabs and help them develop into successful businessmen.”
Usama Fayyad doesn’t pull any punches. In fact, he epitomises the current generation of straight-talking Arabs who have made their careers overseas, but are returning home with grand ambitions at arguably the most tumultuous period in the region’s modern history.
“There’s no strategic thinking. The Gulf countries continually talk about what to do when the oil runs out. They’ve been talking about it for 50 years and they’ll be talking about it for another 50 years. The oil will have run out and they still won’t have developed any solutions”
The Silicon Valley veteran and former chief data officer at Yahoo, who has been chief executive officer of Jordan’s early-stage tech investment firm Oasis 500 since 2010, speaks with the tone of a man who has seen the light elsewhere, but finds it hidden under a bushel in the Arab world.
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“The only country in the Middle East that has got it right is Israel,” he says, displaying disarming honesty for the head of one of the Arab world’s most ambitious start-up investment firms. “Multibillion-dollar venture funds in such a small country, and you know why? Because the people running these organisations have experience in established markets. The Israeli government also has a vision for how it wants to develop the economy.”
Without missing a beat, Fayyad asserts most Arab countries “have no idea” when it comes to economic planning. “There’s no strategic thinking. The Gulf countries continually talk about what to do when the oil runs out. They’ve been talking about it for 50 years and they’ll be talking about it for another 50 years. The oil will have run out and they still won’t have developed any solutions.”
Fayyad is a likeable guy. His honesty is refreshing in a region not known for telling it like it is. He is also an entrepreneur specialising in entrepreneurs. He believes in Jordan and the region’s latent potential and is investing in it regardless of the inherent risks. His capital is ideas, or more precisely, the ideas of young Arabs shaped by technological change and the egalitarian nature of the Internet.
He was lured back to his homeland under the auspices of King Abdullah II, Jordan’s progressive, Harley-Davidson riding, US-educated ruler who had identified ICT as one of the pillars of the country’s economic diversification programme. Oasis 500 is the vehicle designed to realise this ambition.
“King Abdullah II provided the seed funding, but he stressed to me from the beginning that he didn’t want it to be funded by the government long-term,” Fayyad explains. “‘I want the private sector to carry this’, he said. This proved wise guidance on his part.”
Fayyad got to work realising the venture’s ambitious goal of funding 500 tech start-ups within five years.
“In the first year, our aim was to fund 10 companies, a further 22 in the second year and 52 more in the third year,” he explains. “In the first two years, we funded 55 companies.” About 200 budding entrepreneurs were initially offered training during the same period. In the end, demand was so great the number ballooned to 850.
Fayyad says around half of the companies that have benefitted from Oasis 500 funding — anything up to $31,000 in the first phase — have gone on to raise external investment financing of up to $2.5 million. “The first $1.5 million we invested in start-ups generated around $12 million in follow-on financing for these organisations,” he boasts.
In a region awash with oil money to the east, but barren in the west, Oasis 500 epitomises the increasingly emboldened approach to economic self-determination that is taking shape in the Levant. For all its historic misfortune — few natural resources, faltering economies, high unemployment and a location at the geographic heart of conflict — the region is the crucible of the high-tech revolution that is reshaping the Arab world.
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