Arab Tech Entrepreneurs Forge Links Between the Middle East and Silicon Valley

Adel Youssef had a rising career at Google as the main architect of its location-based software strategy in the Arab world. Yet, he had a nagging feeling he needed to do more to help his homeland.

Last year, the software engineer left his cushy job in America to launch Wireless Stars, an Egypt-based startup where homegrown talent could gain firsthand experience. He hired recent graduates out of the University of Alexandria and became a mentor and a boss. "Just caring about myself and ignoring their need for help was not an option for me," Youssef says. "I just jumped on this."

He’s not alone. Youssef, 39, represents a vanguard of technologists trying to cultivate a legion of Arab entrepreneurs through one of the pivotal building blocks of the new economy: mentorship. Silicon Valley-based TechWadi and the Middle East’s Wamda recently have introduced social networking sites to connect mentors with Arab entrepreneurs in a concerted effort to jumpstart business despite political instability that has swept the region this year.

Such new models for social networking are evidence of how ideas first conceived to change human interaction on the Internet are broadening beyond their initial scope. Building a platform dedicated to mentor relationships isn’t much different than a Facebook page designed to mingle with friends. Although the timing of the initiatives is coincidental, the groups’ leaders say they are acting now to help Arabs gain a foothold in a global economy where a laptop and a good idea can prompt life-changing ventures.

Harvesting Knowledge

TechWadi, a nonprofit group fostering economic development in the Middle East and North Africa region (MENA), has started an e-mentorship program called MentorCloud. It is a private social networking platform between mentors, investors and entrepreneurs in Silicon Valley and MENA.

The social network was created by Ravishankar Gundlapalli, chief executive of Parjanya Inc., in Milpitas, Calif. Gundlapalli, 41, has a doctorate degree in fluid mechanics and spent many years helping supply chains in the automobile and airline industries. Now he’s interested in intellectual supply chains, connecting experienced elders with eager young talent that could greatly benefit from advice. "America is going through aging," Gundlapalli says. "The knowledge of the 70 million is going out of the door if it is not harvested properly."

He found TechWadi chairman Ossama Hassanein through an online search. Then Gundlapalli sold him on the idea of a Facebook for mentors. The group is among the first customers testing the product in a beta format with about 100 mentors. As an angel-funded entrepreneur, Gundlapalli has created an easy-to-search directory of mentors and mentees and a simple way for them to engage online.

The service is free but TechWadi carefully screens applicants, says Roham Gharegozlou, an associate of Newbury Ventures. "We are not focused so much on ‘matches’ as on relationships," Gharegozlou says. "Many times each startup will be matched to several mentors, as is the case with all of the companies we are currently working with. Each mentor serves as a point of contact for their own expertise, and since both the startups’ need and the mentors’ interests change with time, so will the mentor relationships."

TechWadi hopes to have more than 100 matches in the first year of MentorCloud, more than 1,000 within five years. Its biggest selling point is the deep well of technologists it has recruited to help.

The organization has made mentorship the focal point of a number of its initiatives. Its startup coach program in Silicon Valley matches young entrepreneurs such as Youssef with more experienced members of the group. TechWadi also has sponsored two mentorship boot camps, including one last October in Cairo, and a summer startup training camp in Egypt in July.

Gaining Business Understanding

Mentorship has become a universally accepted practice in Silicon Valley where fresh-faced college kids often set off to fashion the next Google without a sophisticated understanding of practical business matters.

Mentors become pivotal in this type of environment because they often serve as trusted confidantes. Unlike seed investors, mentors usually don’t have a financial stake in the company. "When you mentor someone you get exposed to this excitement and ideas," says Dania Hiasat, who worked at Mowgli Jordan. "It ignites the entrepreneurship spirit in you."

One May evening, Hassanein, a general partner with the venture capital firm Global Technology Innovation Partners, hosted two dozen young Arab-Americans interested in TechWadi’s mentorship movement. Gundlapalli gave a presentation of how MentorCloud works, and guests debated the merits of its potential.

Ramy Adeeb of Khosla Ventures in Menlo Park, Calif., a few blocks from where the gathering took place, encouraged his peers to open themselves to the idea of mentoring. "There is tremendous hunger in the Middle East for mentors," he told the group. "A lot of times you have a corporate program that fails because it was set up just for setting up the program. You cannot blame eHarmony because people get divorced."

An MBA student questioned what he could offer because of a lack of roll-up-your-sleeves experience. "Don’t underestimate what you can contribute," Hassanein told him.

When Hassanein offered encouragement, he had the big picture in mind. More to the point, he was thinking about someone like Mohammed Omar El Saadi of Beirut. El Saadi, 27, could be found one recent day at the Knight Management Center on the sprawling Stanford University campus, just a few miles from the headquarters of Facebook, Google and respected venture capital firms.

After earning a degree at the American University of Beirut, El Saadi got a master’s degree in electrical engineering from Georgia Tech. He’s on track to earn a MBA at the Stanford Graduate School of Business in the coming year.

El Saadi has gained an immeasurable amount of knowledge useful for starting a business in Lebanon and beyond. He understands the role his generation has to play in reshaping the future. He plans to return to the Middle East with the intent of starting a technology business. "We don’t have a right to complain if we’re not taking part in that change," he says. "An idea will stay an idea unless you can put some proper business knowledge around that."

Sometimes it takes mentors to help advance an idea. Peter Cappelli, a professor of management at the Wharton School of Business and director of Wharton’s Center for Human Resources, says mentorship is one of the fundamental features of entrepreneurship.

"Mentorship is about passing along tacit knowledge, the kind of information one can only get by actually doing something," says Cappelli, who once served as Bahrain’s senior advisor on employment policy. "Without a lot of other mentors around, it is hard for budding entrepreneurs to avoid lots of painful and potentially crippling mistakes."

Spiritual and Practical Guides

Christopher M. Schroeder, a Washington, D.C.-based angel investor who served as a delegate in the U.S. State Department Global Entrepreneurship Program in Egypt, describes mentors as spiritual guides with practical sides. He says mentors lend support, help make important introductions and provide a sounding board when innovators feel lost.

"Entrepreneurship is one of the loneliest things on Earth," he says. "You are a little crazy to want to try to do something nobody has done." Schroeder, who has spent considerable time in the MENA region, says mentors often serve the role as a "shrink."

"There’s so much rattling around in one’s head when doing one of these things," he says. "It’s not just about a business problem being solved." It’s letting the entrepreneur know she or he isn’t alone. "Everything you’re going through others like you have been through it before," Schroeder adds.

Youssef, who earned a doctorate degree at the University of Maryland, is discovering just how important this link can be while steering his small company through the shifting sands of Egypt. He knew leaving Google would be a risk, but he had to try it. "Most people think of doing business in Silicon Valley and outsourcing in the Middle East," Youssef says. "I thought we needed to build technology there — build a business from scratch in the Middle East."

In January, Youssef introduced a location-aware social networking application similar to foursquare, a Smartphone tool that helps friends connect at cafes, cinemas and other gathering locales. He called it "IntaFeen" — the Arabic phrase for ‘Where are you?’

The timing proved uncanny. Within weeks of the launch, the application had become an instrument of political reform that led to the ouster of former Egyptian President Hosni Mubarak. While Facebook and Twitter have been credited for helping galvanize a technological savvy generation of Arabs, "IntaFeen" emerged as an important tool because users knew where protesters were congregating at any given moment.

"People wanted to show they were in the street," says Youssef, whose company is among a handful born out of TechWadi’s startup coach program. "It tied messages to location," he adds, noting it encouraged more protesters to show up at Tahrir Square in central Cairo.

The unintended consequence caught Youssef by surprise. Users had integrated the new platform into organizing protests in a country where global positioning systems aren’t readily available, he says. It became evident that a wired community could be a powerful antidote to authoritarian governments. Not surprisingly, Google executive and protest leader Wael Ghonim termed the uprising, "Revolution 2.0."

Egyptians wasted little time in exploiting "IntaFeen’s" location feature. They employed the application when traveling to Libya to support forces opposed to Col. Muammar Gaddafi, Youssef says. The location device allowed drivers hauling medical supplies and food to check with Libyan contacts in real time to know exactly where to meet.

Fundamental Aspects A Challenge

As exciting as it was to watch the technology evolve, Youssef struggles with some of the more fundamental aspects of building an e-business in the Arab world. The entrepreneur has loads of technological experience from working at Google. But he doesn’t have an employee who knows much about marketing and publicity. In other words, he needs guidance on the business side of his startup. That’s where his TechWadi mentors enter the fray.

While many of the lessons are universal, author Malcolm Gladwell highlighted potential cultural disparities in a New Yorker story exploring the idea of creation. "The United States," Gladwell wrote, "has a decentralized, bottom-up entrepreneurial culture, which has historically had a strong orientation toward technological solutions."

The more traditional top-down approach in the Middle East and North Africa hasn’t promoted the kind of organically grown mentors as seen in Silicon Valley. Wharton’s Cappelli says mentorship might need to have a more hands-on role in the Arab world because of a reluctance "to just throw oneself into a problem and try to muddle through."

Risk aversion has been well-documented in Arab circles. The older generation hasn’t made the switch to the high-paced startup culture where it takes a new kind of connection to succeed. It’s a hurdle Mowgli’s Hiasat has faced since opening the foundation’s Amman office in January to better promote the group’s free mentorship services. (The United Kingdom-based Mowgli Foundation has been encouraging the rise of mentorship in the Middle East since 2009 but this year began working with Wamda to buttress its efforts.)

She has become a one-woman purveyor of change in Jordan by trying to overcome entrenched beliefs to forge a new path. "Here you are governed by your family, by the customs," she says. "There’s a sense that life is already designed for you. You go to school. You have a relative somewhere and you try to get a good job."

Schroeder, the Washington-based angel investor, sees perceptions about failure as some of the biggest obstacles to a vigorous startup ecosystem. "Bankruptcy laws are antiquated to say the least," he says. "That translates in two ways: Efficacy of getting capital raised and getting transactions done … is problematic. More importantly, people at the end of the day can just get hyper-upset and make mistakes because they are so afraid that this could lead to failure."

That view of failure is a stark contrast to Silicon Valley where entrepreneurs boast about unsuccessful startups like proud parents. A vibrant mentorship culture could help assuage fears of flopping in Arab nations. Mowgli tries to sell this idea through well-crafted YouTube videos celebrating successful Arab entrepreneurs. Many laud their mentors as being gifts from god.

Now Wamda wants to accelerate the process by closing the gap on the early stage ecosystem by empowering entrepreneurs and investing in them. Lebanese entrepreneur Habib Haddad recently has become Wamda’s chief executive with offices in Beirut and Dubai.

While Wamda, which means "spark" in Arabic, is looking to turn the entire system on its head, it understands the role of mentors. It has developed the online platform MentorMatch, a matching algorithm instead of a self-contained mentorship dashboard like MentorCloud.

Both programs have similar ideas, however, about how to encourage connections. Instead of having to wade through thousands of hits from a typical online search engine, these programs provide customized searches to match entrepreneurs to mentors.

With MentorMatch, an individual creates a detailed profile including interests, skills, experience and location. Entrepreneurs can search the database using different criteria. It is owned by Abraaj, one of the Middle East’s largest private equity firms.

"A portal like Wamda is, in its most ideal conception, trying to transform elements of society," says Nina Curley, who has worked as an editor at Wamda since its inception. "Part of our goal is to facilitate new business connections that don’t immediately come from family and friends. MentorMatch is aimed at creating these new avenues."

Instability Remains A Factor

While the hyper-connectivity of the Internet works for many individuals, there’s nothing like old-fashioned meetings at cafes to make deep connections, Haddad says. Such personal contact can build rapport and make it easier to impart tough lessons. "People can say you really do understand my ethos, you understand my religious views, understand my criminal views," Schroeder adds.

Mowgli, the brainchild of Zimbabwe native Tony Bury, also works on the front line like Wamda. It has outreach offices in Jordan, Lebanon and Syria to give it a better chance of recruiting local entrepreneurs.

But the instability in Syria, Libya, Bahrain and elsewhere cannot be ignored at the very moment some Arabs are marshaling forces to strengthen the region’s entrepreneurial ecosystem. Mowgli, for instance, has discontinued its planned events in Syria for the time being.

Creating a new economic engine seemed almost idealistic as the Arab Spring faded into a summer of uncertainty. But few promoting change live in a state of Pollyanna. Instead, they view entrepreneurship as necessary in a region that some estimate will need to create 100 million jobs in the coming five years to accommodate the population explosion.

El Saadi, the graduate student from Beirut, says the region doesn’t have the luxury to wait for democracy. "The economy can’t just keep waiting for an answer from external forces or from outside lands," he says. "It just doesn’t work like that."

Wamda’s Haddad couldn’t agree more. He calls the region the new China, saying the Middle East and North Africa is in a similar position of the Asian giant 10 years ago. Investors might recall the meteoric acceleration of China that started with a backwater infrastructure and almost overnight transformed into an economic trendsetter. "Do you really want to miss out on the next e-China?" Haddad asks. "The Middle East is the door to South Asia, the door to Turkey. It’s even the door to countries that are tougher to reach directly. This is a unique opportunity in time and won’t last for long."

Schroeder says investors haven’t backed off, telling him, "Egypt is not going away."Will reform in Egypt get squashed? "It could," he adds. "In the meantime, it’s just happening."

Wireless Stars’ Youssef and his brethren aren’t ignoring the political questions because it’s difficult to conduct business until Egypt sorts out its emerging governance. But impassioned Arab entrepreneurs continue to host meet-ups, create accelerator hubs and thirst for mentorship.

Their sense of empowerment has fashioned a psychological revolution among those who reject the past. Perhaps whoever takes the reins of rule will find they also will be governed by a new principle — a technological-inspired transparency that led to their predecessors’ downfall. It’s just the kind of impetus fueling optimism that a robust entrepreneurial community might rise up from the streets of protests.

The watchword these days is bidaya, Arabic for start. "Now we know it is up to us," Youssef says.

Citing Knowledge@Wharton

Close


For Personal use:

Please use the following citations to quote for personal use:

MLA

"Arab Tech Entrepreneurs Forge Links Between the Middle East and Silicon Valley." Knowledge@Wharton. The Wharton School, University of Pennsylvania, 13 September, 2011. Web. 20 December, 2014 <http://knowledge.wharton.upenn.edu/article/arab-tech-entrepreneurs-forge-links-between-the-middle-east-and-silicon-valley/>

APA

Arab Tech Entrepreneurs Forge Links Between the Middle East and Silicon Valley. Knowledge@Wharton (2011, September 13). Retrieved from http://knowledge.wharton.upenn.edu/article/arab-tech-entrepreneurs-forge-links-between-the-middle-east-and-silicon-valley/

Chicago

"Arab Tech Entrepreneurs Forge Links Between the Middle East and Silicon Valley" Knowledge@Wharton, September 13, 2011,
accessed December 20, 2014. http://knowledge.wharton.upenn.edu/article/arab-tech-entrepreneurs-forge-links-between-the-middle-east-and-silicon-valley/


For Educational/Business use:

Please contact us for repurposing articles, podcasts, or videos using our content licensing contact form.

 

Join The Discussion

No Comments So Far