Dana Alfaraj: Why did I choose to work in a startup right after the graduation?

2016_06_27_dana_alfaraj_ghinwa

After 23-year-old Kuwaiti Dana Alfaraj graduated from the American University of the Middle East in January 2016, she decided not to go with the flow and take some job in a public sector, but to start her career in a startup. She holds a bachelor’s degree in Industrial Engineering and is currently working as an intern at Ghinwa, a startup that won the first place at recently held MIT Enterprise Forum Arab Startup Competition.

StartupQ8: What (or who) motivated you to start your career in a startup and not in a public sector? When did you decide to do so?

Dana: Ever since I was young, I lived an ordinary life like any other teenager. Half way through college, I had a turning point because I realized that I don’t want to live the routine life anymore since it is not who I am. I have many ideas in my mind that I have the potential to accomplish, but I never had the courage to take action. I shifted my perspective of life and I started liking change and taking the risk of trying new things.

My mentor Mohammad AlMunaikh, who is the CEO of Ghinwa, had a huge role in motivating me to enter the world of startups and stepping out of my comfort zone. Before graduating in a month or two, I made up my mind to go for it. In both cases, if it turns good or bad, I’ll learn something from it. So far, I love it and believe that I fit there perfectly because I’m learning a lot in a very short time and I’m enjoying the experience.

StartupQ8: Since the team is based in Dubai, from where do you work?

Dana: I work remotely in Kuwait, but I fly to Dubai whenever I am needed there. In general, most of our meetings are via Skype. Though, there are few meetings that take place in Kuwait. Eventually, when I get the full time job, I’ll be moving to Dubai.

StartupQ8: What is the most challenging part of working in a startup?

Dana: For me, I think the most challenging part is that we are all in different locations. I find it a bit hard sometimes to communicate with the team through Skype or Slack all the time. Although, it is getting easier by time. I also didn’t meet the entire team yet. I would like to meet them and know more about the people I’m working with. This is my first official job and all the members of the team are well experienced. Sometimes, I find it challenging to catch up and be on their pace. The good thing is that I get to observe and learn from their experiences.

StartupQ8: Is there any piece of advice you would like to share with fresh graduates when it comes to choosing private sector over public sector?

Dana: People have different backgrounds and experiences. Some people might fit in the private sector rather than the public sector and vice versa. From my experience, the best advice I would give is to try new things and give it time to discover what you really passionate about to end up in the path that you love. Simply, choose the job that makes you sincerely happy, because it will lead you to gradually succeed in what you’re doing. Make sure you live the journey that you want and enjoy the ride.

We couldn’t agree more with Dana.

How to Make Kuwait a Regional Tech Hub? StartupQ8 Monthly Event Brings the Answers

StartupQ8 event for June was one of the best monthly events we ever had, we can say that without doubt. Not to mention that Mefazec’s coworking space on the first day of June was full of people who wanted to explore the world of startups in Kuwait and how can we make it better.

The event was also a crown of Coded Spring Bootcamp 2016. Co-founder of Coded Ahmad Marafi handed over diplomas to their students with the help of Richard Kramlich, well-known venture capitalist. He is also a co-founder of New Enterprise Associates, a global venture capital company that invests in technology and healthcare.

In the meantime, CEO of fishfishme Abdullah Alshalabi, founder of Lumba, Inc. Abdullah Alzabin, and former CEO of Talabat Mohammed Jaffar as panelists, and Hashim Bahbahani from Coded as a moderator were getting ready to take over the stage and discuss on how to make Kuwait a regional tech hub.

The conclusion of the panel discussion is that building a tech sector is definitely a viable way of moving Kuwait from a country that relies on oil for more than half of its GDP to the place where other sectors are equally represented. We are all aware of the fact that capital is here. We’re also working on a talent and legal structure improvement. The most important thing above all is to make Kuwait friendly place for expats so they can decide on moving and working in Kuwait more easily.

The last but not least speaker was Alvaro Abella from BECO Capital, one of the leading venture capital companies in the Middle East. He was joined on stage by Yousef Hammad. They talked about how entrepreneurs can structure a pitch deck to catch investors’ attention, what to focus on in the presentation, and what content to include. They also spoked about how to choose an investor, and what VCs look for in startups.

That’s all, folks! Follow us on Instagram and Twitter for more events. And one more thing. Keep in mind that our friends from Coded are organizing full-time summer bootcamp and invite you to apply. Hurry up because the deadline is June 13th and you might get one of the two available scholarships!

Announcing: StartupQ8 Event for June 2016

Mark your calendars for a new StartupQ8 Event!

You really don’t want to miss this one!

The first part will be an open discussion panel on how Kuwait can become a regional tech hub. The panelists will be Abdullah Al-Zabin (Lumba, Inc.), Mohammed Jaffar (formerly of Talabat), and Abdullah Al-Shalabi (fishfishme). The panel will be open and interactive with the audience.

Following that, we have Alvarro Abella-Managing Partner at BECO Capital, one of the leading Venture Capitalist firms in the Middle East. Alvarro will talk about how startups should choose an investor, and what VC’s look for in startups.

The event will be held Wednesday (June 1) @ 7 pm at @Mefazec (Alhamra Tower, 16th Floor). Here is the schedule

7:00– 7:15 Welcome
7:15 – 8.15 Startup Panel
8:15 – 9:00 Choosing the Right Investor
9:00 – 9:30 Networking + pizza

As always, the event will be in English and it is open to everyone (no need to register). Follow our social media accounts for more info (@StartupQ8 on Twitter and Instagram).
See you there!

Did The Technology Industry Reach Its Plateau?

The Technology Hype

There is too much hype around staggering technology startup valuations, unicorns, Apple’s cash position, Alphabet’s vision, and many more. Most of what I hear and read is whether or not the technology industry reached a plateau. Partly the reasoning is the exaggerated valuations, sometimes lavish life style of few technology entrepreneurs, and whether we really want so much new features in our mobile devices, or augmented reality?!

The Scope of the Research

That’s a very broad subject, and I spent time researching various angles that can tackle some of the questions that arise towards the technology industry. In essence, I decomposed the questions I want to answer based on different stakeholders:

Venture Capitalists: Should we raise a new fund? Should we continue investing in more startups? Is there enough room for mergers and acquisitions activity so we exit our positions?

Entrepreneurs: Should I start a new tech startup? Doesn’t it seem a bit too much crowded now to start yet a new startup? Would the big boys with big bucks have any interest/capital in the next 5 years to buy out my startup?

Executives of tech companies: How much more room we have for growth? Can we still play the acquisition game to grow our market share?

Methodology

Obviously, those questions cannot be answered in a one page blog post. However, a simple yet data driven approach can give us amazing insights into answering them.

Business Consolidations

Industries go through four stages until they become so called “mature” or “stable”. Based on the article “The Consolidation Curve” in Harvard Business Review, the four stages are Opening, Scale, Focus, and Balance and Alliance.

Briefly describing, the article tackles the consolidation curve of industries by measuring the market share of the top 3 players of the industry.

  • Opening: A monopoly that soon vanishes and the top 3 players control between 10% to 30% of the market due to an influx of competitors.
  • Scale: Major players emerge and buy up competitors. Top 3 players control between 15% to 45% of the market.
  • Focus: Top 3 players focus on aggressive growth and control 35% to 70% of the market. Still 5 to 12 major players are around.
  • Balance and Alliance: The top 3 players control about 90% of the market and form alliances between themselves.

Current Market Analysis

So if we take that segmentation as a basis to find out how much the technology market has emerged, and how much growth can it still absorb, then what we need to find out is how the top 3 players of the technology market stack against the entire market.

Unicorns and Listed Companies

My assumptions going forward would be the following:

  1. The basis of the research is the United States market.
  2. Listed Technology companies in the NASDAQ market comprise all the publicly traded technology companies. Link to the list.
  3. Private technology companies that matter are the Unicorns, i.e. startups that reached beyond the $1 Billion valuation. Link to the list.

Total Addressable Market

Screen Shot 2016-05-26 at 10.59.44 AM

Top 3 Players of the Tech Market

Screen Shot 2016-05-26 at 10.59.54 AM

Scale Stage

Sum of the top 3 players’ market shares is: 27.9%. This puts the Technology industry into the second stage of scale based on HBR’s article.

So What Does This Mean?

To answer the questions we addressed at the beginning, we need to take a look at the scale stage. Here’s how it’s described based on HBR’s article:

Because of the large number of acquisitions occurring in this stage, companies must hone their merger-integration skills. These include learning how to carefully protect their core culture as they absorb new companies and focusing on retaining the best employees of acquired companies. Building a scalable IT platform is also crucial to the rapid integration of acquired firms. Companies jockeying to reach stage 3 must be among the first players in the industry to capture their major competitors in the most important markets and should expand their global reach.

This describes the rapid M&A activity by large players trying to acquire as much good startups as possible to ensure their own survival. In summary, the answers to the questions would be:

Venture Capitalists: Should we raise a new fund? Should we continue investing in more startups? Is there enough room for mergers and acquisitions activity so we exit our positions?

Answer: In short: Yes. There is still room. However, funds should predict the estimated timing of stage 3 of the market. VCs should focus on growth startups in the industry’s transitioning phase into the third stage. Reason why is that the big players won’t have enough time to buy out startups at early stages and can only accommodate growth startups that will immediately add to their top lines and make fast synergies with their businesses.

Entrepreneurs: Should I start a new tech startup? Doesn’t it seem a bit too much crowded now to start yet a new startup? Would the big boys with big bucks have any interest/capital in the next 5 years to buy out my startup?

Answer: While entrepreneurship is always encouraged, and one should be dedicated to growing his/her company, I think with the tech scene becoming too crowded, tech entrepreneurs should have a solid idea regarding their possible exit strategy to one of the major players in the technology scene. That may seem trivial but from personal experience, I see lots of startup founders tackling legitimate problems but not having an idea about their exit strategy. Also, it does not necessarily mean that the exit synergy should ONLY be with Apple, Google, or Microsoft. Although these three are the giants, other major players are still very legitimate options since the industry hasn’t gone through the third stage yet.

Executives of tech companies: How much more room we have for growth? Can we still play the acquisition game to grow our market share?

Answer: Yes. There is plenty of room to grow. 27.9% of the market is way behind the 90% mark. However, acquisitions should be targeted smartly in various verticals in the sense that not only adds to the top line directly, but also makes it harder for the competitors to join that specific vertical. In short, release products and acquire startups revolving around the product to make the barriers for entry in that product’s vertical harder bracing for an aggressive competition in stage 3.

StartupQ8 Event for April reveals a secret to Silicon Valley

On April 24th, we hosted our monthly event which was extra special thanks to guys from Flexport, and our panelists Dr. Mussaad Al-Razouki, Philip Pasler and Abdul Qader Hussain.

The event was held at Mefazec, a venue provider for Coded’s spring bootcamp. It started along with Flexport team, Sanne Manders and Ryan Petersen, who talked about their startup path.

If you weren’t familiar with this San Francisco based startup before, it is a licensed freight forwarder that uses people and software to manage the complexity of international trade. It is also a Y Combinator and Google Ventures backed startup that has been featured in Bloomberg, Forbes, and others. They move lots of air freight and thousands of containers of ocean freight every month, and also provide all the necessary coordinating functions.

During the talk, Sanne mentioned that startups need to concentrate on a customer experience and not look so much on a marketing, shareholders etc. According to him, focusing on a customer experience is the key to a Silicon Valley.

The other part of event was dedicated to angel investor and VC panel where entrepreneurs and investors discussed fundraising for startups. White answering the questions from the audience, Dr. Mussaad emphasized the importance of a good team. Investors don’t invest in your idea, they invest in you and your team. So, if you are running a startup, be sure to find the right people for your team – not only because of potential investments, but your business and success.

After the event came to its end, we rounded it up with networking with pizza as we usually do.

Keep an eye on our Instagram and Twitter account and be the first to find out about StartupQ8’s events!

Announcing: StartupQ8 Event for April 2016

We have an extra special event on Sunday (April 24), with global startups and investors!

Our first speakers will be Ryan Peterson & Sanne Manders from Flexport, a freight forwarding startup out of San Francisco. Flexport is a YCombinator & Google Ventures backed startup that has been featured in Forbes, Bloomberg, WSJ, among others.

Their team will speak about the Flexport story and how it’s revolutionizing international trade.

Following that, we have an Angel Investor & VC Panel featuring Dr. Mussaad Al-Razouki, an entrepreneur and regional investor, alongside Abdul Qader Hussain, a seasoned investor and former consultant with AT Kearney, and Philip Pasler, a Berlin based investor and healthcare sector consultant.

The event will be held Sunday (April 24) @ 7.30 pm at @Mefazec (Alhamra Tower, 16th Floor). Here is the schedule

7:30– 7:35 Welcome
7:35 – 8.20 Flexport
8.20 – 8:30 Break
8:30 – 9:15 Angel Investor Panel
9:15 – 10 Networking pizza
. . .
As always, the event will be in English and it is open to everyone (no need to register). Check our blog more info.

See you there!

Announcing: StartupQ8 Event for March 2016

📌 StartupQ8 Event This Tuesday📌

Don’t miss Tuesday’s StartupQ8 event!
. . .

Our first speaker will be Zaid Almuqbel, Partner and Business Developer at Diwaniya Labs. Zaid will discuss Diwaniya Labs’ journey to success over the past 5 years, which included producing several hit mobile games like iKout.

Our second speaker is Ahmed Shbli, an avid iOS game developer with over 7 years of experience building different types of mobile games. Ahmed will present on how start and run a Video Game startup, and how to turn a video game into a profitable business.

The event will be held Tuesday (March 22) @ 7.45 pm at Mefazec (Alhamra Tower, 16th Floor).

Here is the schedule

7:45 – 7:50 Welcome
7:50 – 8.30 The Story of Diwaniya Labs with Zaid Almuqbel
8.30 – 8:35 Break
8:35 – 9:15 Video Game Startups with Ahmed Shbli
9:15 – 10 Networking pizza
. . .
As always, the event will be in English and it is open to everyone (no need to register).

See you there!

The Rise of “Community”

5 years ago, there were a number of entrepreneurial initiatives in Kuwait that large sums of money were allocated to but were operating independently of each other. A few governmental programs were servicing funding needs through both debt and equity instruments but nevertheless did not cover other building blocks of the entrepreneurial ecosystem, to name a few here is a list:

  • Kuwait Small Projects Development Company
  • Industrial Bank of Kuwait
  • AlRaeda Enterprises
  • KAMCO

 

Half (approximately) of the allocated funds for these programs were earning interest from deposits and the other half typically funded traditional businesses, with no focus on knowledge based economy. However, the SMEs scene in Kuwait was still quite active relative to the rest of the GCC and a majority of small businesses and startups were funded by private money (friends & family) through traditional funding terms.

 

On the consulting side, there were a lot of boutiques that offered relatively expensive consultations (to the size of businesses being established) and a few were more entrepreneurial friendly in pricing. Here is a list to name a few:

  • AlMubadir
  • Cubical Services
  • Traditional accounting/consulting firms
  • Manpower and Restructuring Program

 

Challenges

Beyond the abovementioned services, entrepreneurs were very much self-dependent (hustlers) and have been struggling with the following key issues:

  • Excessive regulations: It is very challenging to start a business in Kuwait as the licensing requirements and procedures are quite complicated, they take a lot of the entrepreneur’s time to start and maintain rather than focusing on the business 100%.
  • Attracting and maintaining talent is hindered by the strong benefits that the government offers and by the generous labor law rules and regulations with very restrictive immigrant labor permits.
  • Being the largest procurer, Government business penetration is very challenging and is predominantly taken by large corporations and family offices.
  • Access to private finance is limited as most private financial institutions do not view the SME/Venture asset class strategically and the Central Bank’s interest spread cap of 400 basis points is prohibiting high risk taking.
  • Support programs are nascent whether its incubation services, grant schemes, mentoring, business development services, there are a handful of programs with limited capacity.
  • The mindset and culture stand against encouraging modern entrepreneurship. Entrepreneurs are directly encouraged to take a risk-averse mindset and no sense of community exists.

 

Territory marking

With that said, there were a few startups in different industries that were marking Kuwait on the regional map, to name a few in the technology sector: Talabat, Koutbo6, KuwaitNet and many others in different sectors.

 

Infrastructure & market

During those years, government has invested heavily in telecom and internet infrastructure enabling residents and offices to benefit from fiber optic cabling in most areas around Kuwait. As the price of technology access was also witnessing a significant decline, penetration of internet became much more affordable and the bandwidth was only getting better and cheaper. The Apples of the world were causing huge software and hardware disruptions, making the quality and ease of using technology more accessible/useable than ever. The connectivity and efficiency only drove the world to be more connected through brilliant platforms and hardware and everything around the world was only a click away from everyone. Smartphone penetration climbed up the charts and Telecoms focused more on VAS for their customers, as voice calls became a utility.

 

Changes in Local Landscape

Kuwait LandscapeIn the past 5 years, the Lean Startup school of thought became more global and standardized the startup’s lifecycle, early stage funding methods and tools were becoming more visible. As a result of funding gap challenges we had in Talabat.com, my partner and I started setting up a late stage VC practice in 2012 that evolved into a larger project on a national level (the National Fund for SMEs Development), and several institutions started exploring the rising asset class (Venture Capital) where international private funds started flowing into the ecosystem (i.e. Talabat.com) and incubators/co-working spaces started blooming. Individuals (including myself and many others)/family offices/corporates continued to invest in the asset class and the funding gap is much smaller in size than it used to be. Startup competitions (local and international) were happening and developers/designers became more in demand. Despite not having a tax-break policy for non-profit initiatives in Kuwait, non-profit startup initiatives became very popular and the calendar year started filling up with many events in the startup world. Here is an overview of how the local landscape looks like today.

 

Community

If we look at the above table, a super majority of these initiatives are led by entrepreneurs, not government and not corporates (I‘m sure there are more efforts which I missed in the list). These are striving entrepreneurs who are giving us a sense of a real community that is shaping the future of our country’s startup ecosystem. As Brad Feld repeatedly mentions in his “Startup Communities” book, “entrepreneurs always lead the community” and this is exactly what we’re witnessing in Kuwait. There is a new culture of openness and information exchange between entrepreneurs that none of the earlier generations ever witnessed. Mentoring has become more standard and the notion of protecting your idea is gradually becoming obsolete. With more than 60% of the population less than the age of 35, the landscape is only starting to shape right now with much more efforts being geared for the community. There is a very important role for corporates and government to play but ultimately, the community has to continue being led by entrepreneurs who should streamline other stakeholders’ efforts for their benefit.

20 years ago, our flagship startup was Sakhr and we had Talabat conquering the marketplace model for the GCC in the past 10 years… all of that without 10% of the resources currently available for the community. Can you imagine what the next 10 years can produce for the local startup community? IT CAN ONLY GET BETTER!

 

 

Abdulaziz B. Al Loughani

@aballoughani

1st StartupQ8 Event in 2016 – This Tuesday 19th of Jan!!

Hi guys,

We are kicking off 2016 with a StartupQ8 event this Tuesday the 19th of Jan at 7PM in Global Tower. I know this might be a short notice, but we promise this event will be worth it. Two interesting talks in the event:

1- 7pm – 7:45pm Startup Weapons:

Abdullah Alshalabi (the co-founder of StartupQ8 and Fishfishme.com is back!) will be talking about Startup tools. The tools that will help you with your support, design, marketing and sales activities. He probably used more than +100 tools during his 4+ years journey and will cover the best ones with some live examples. 
Best List

2- 8pm – 8:45pm Ajar Story:

Ajar is a mobile App to pay your apartment rent (and for landlords to collect rent). The founder Shaheen AlKhudhari will tell their story with how they secured the big partnership with Warba Bank.

Ajar

 

The event will start on 7pm sharp, don’t be late. Event for free, in English and open to everyone. Questions? contact Startupq8@gmail.com.

Announcing Coded’s Spring Coding Bootcamp

Folks,

We all know how hard it is to find a talented coder to hire or be your co-founder. So sometimes, the best thing to do is to go learn the technical stuff yourself. In the least, mastering the fundamentals of programming helps you  communicate with your technical team, and be more valuable to the product building process.

There’s no doubt that the time and effort you invest in your coding education will pay dividends for your startup in one way or another.

If you’re looking for a place to learn how to code, Coded, Kuwait’s first and only coding bootcamp, has announced earlier this week that they are accepting applications for the Spring coding bootcamp.

Coded Bootcamp Announcement

The bootcamp is aimed at beginners who want to become professional programmers. Coded students graduate as junior level professional coders.

The Spring bootcamp, which starts in March, is an intensive part-time bootcamp with 4 hours of class every weekday (5m to 9m), and lasts 14 weeks. The part-time format makes it easy for those who have a full-time commitment in the day time to join the bootcamp in the evening.

The application deadline is Feb 7th, 2016.

You can check it out and apply on joincoded.com 

 

Good luck!

 

 

 

 

 

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