This article was originally published on Forbes on 11-Jul-2016 and is written by Mr Kamal Hassan, General partner TURN8 Fund.
Large corporations in the Middle East (and elsewhere) tend to lag behind in innovation. Once they reach a certain size, competitive pressures seem to diminish, and they lose their nimbleness. Recognising this, some companies have started to think about investing in startups as a strategy for spotting and ultimately profiting from innovation. But there is an art to doing this successfully, and many Middle East organisations have not yet mastered it.
Let’s start with the basics. There are three ways for large companies to innovate:
1. Inorganic: do an M&A deal.
2. Organic: engage in internal research and development, testing new products and expanding the ones that work.
3. Invest in early stage innovation: set up a venture arm.
Five to seven years ago, #3 was not really a factor in the Arab world. Corporate investment basically entailed buying out your potential competitors. But more recently, companies are beginning to look at startups as a way to innovate. On the positive side, that’s great news. This is what happens in much of the developed world, and it’s a proven strategy.
On the not so positive side, the Middle East lacks an IPO exit market, so investors are limited to M&A deals as their exit path. This is a manageable problem, but a bigger one looms large: in this region, executives are not experienced investors. In other words, they don’t know how to loosely hold an entrepreneurial relationship, or to cultivate cultures of entrepreneurship and innovation. They invest in a manner that has the potential to crush innovation. For example, experienced investors are hands-on—dispensing advice, helping startups gain traction, build strong teams, and globalize their offerings. But in this region, many corporate investors treat entrepreneurs like employees. They impose restrictions that forbid the entrepreneurs from doing business with the investor’s competitors, or they impose bureaucracy on these still delicate entities. They want exclusivity. They want 10-year plans. In reality, entrepreneurs have no idea where they will be in 10 years, or even five. They may be forced to pivot. Market conditions may change. Each new executive hire has the potential to shift paths. If you push all the uncertainty out of the entrepreneurial process, you will be left with a process that is anything but entrepreneurial. Instead, corporate venture investors should be thinking like real VCs.
Even in the United States, where corporate ventures are commonplace, large organizations have trouble maintaining the deft touch necessary to nurture rather than crush innovation.
What leaders in the Middle East call corporate venturing isn’t really corporate venturing.
It makes sense to look elsewhere for examples. For example, nearly every bank and telecom in Southeast Asia invests in venture capital funds. The banks understand they are not the experts in this realm, so they are content to watch and learn.
They might seek to embed some sort of terms that give them the option to invest more at a certain trigger stage, or perhaps a right of first refusal. They might also seek the right to co-brand with a startup as their technology matures and they expand. But such actions simply give them a window of six to twelve months in which they will have an innovation head start; they do not crush innovation.By being a limited partner in an established venture capital fund, established organisations participate in the purest form of innovation. VCs are more skilled at finding and nurturing innovators with the hope of achieving market success; their objective is simple: produce attractive financial returns. In contrast, corporate ventures tend to have a strategic objective, and in the Middle East such objectives can be so dominant as to all but eliminate any true innovation.
To nurture innovation, you can’t simply go through the motions. You have to give innovators room to innovate.
– See more at: http://www.thecribb.co/en/blog/read/213138926/the-perfect-pitch#sthash.tNrJpjTp.dpuf
A new round of startup teams have arrived in Dubai to attend growth-focused workshops, meet mentors, investors, and gain traction for their advanced-stage startup. With the launch of a new pre-accelerator next month to manage early-stage idea startups, this round represents a shift in TURN8’s approach to invest in later stages of startups’ lifecycle in the effort of encouraging more commercial success. During this round’s acceleration period, teams will finalize their products or MVPs, go-to-market plans and launch.
TURN8’s program manager, Ahmed Abdulwahab, remarks about this round, “These teams demonstrate innovative solutions with real game-changing possibilities. Within the TURN8 program, we coach teams in accelerating their product, sales and marketing efforts. It’s exciting to accompany this round of startups on their journey of market entry and scale.”
The startup companies that were chosen for TURN8 Round 6 include:
AirGo (Singapore): AirGo is an award-winning and patent-pending design concept that will take both airlines profits and passenger experience to a whole new level.
Bridg (UAE): Bridg is a mobile payment platform that allows smartphones to transact regardless of connectivity. Bridg partners with local gateways and processors to enable fast deployment across the global landscape.
Crowdbabble (Canada): Crowdbabble helps marketers to benchmark and optimize their social media performance by understand what is working and what isn’t, for themselves as well as their competitors.
Meetizer (Spain): Meetizer is the social app where travelers and expats connect and share plans in real-life by creating ‘here & now meetups on the go’ over a coffee or lunch break, an event or whatever they plan.
Finerd (UAE): Harnessing the power of the latest technology, rigorous academic research and an honest management, Finerd provides intelligent investment solutions for everyone.
Visage (UAE): Visage is a crowdsourced recruiting platform for startups and SMEs. Professional recruiters worldwide refer their surplus candidates.
HeyDoc! (UAE): HeyDoc! is a healthcare communications & technology platform dedicated to connecting patients with t medical consultants, wherever they are, the easiest way possible. Delivering in-app consultations, without the need for physical appointments.
Prattler (Ukraine): A social media creating a user’s own brand in a live stream while following any broadcasted media content. Users can stream themselves directly to share emotions, thoughts and reactions with others while building their following of other users viewing the same event.
Mailburn (Russia): A clever business communication solution that will change emails forever by allowing users to close more business tasks and bring the entire business communication industry up-to-date through speed, security and openness.
The teams will graduate 18 May 2016 at the TURN8 Demo Day, pitching for late seed or early Series A funding from regional investors.
TURN8 is an accelerator in Dubai UAE, initiated in partnership with DP World in 2013 to invest in technology startups and support them with mentoring, training and their product launch in exchange for an equity position in the company. As part of its larger mission, TURN8 and DP World work to integrate these startups into the global innovation ecosystem and startup economy of the UAE.
For applications for Round7 visit www.TURN8.co/apply
Startups from around the globe come to be mentored, learn to be business savvy
TURN8, the successful seed accelerator initiative founded by DP World that encourages entrepreneurship and innovation has selected nine new startups for investment as part of round five of its programme
Some 23 startup companies at a market value of US $30 million have been established since the beginning of Turn8. The latest round follows a selection process to identify startups that have a promising business concept and who have had some experience testing the market.
The international reach covers global markets with participants from the UAE (Dubai), Spain, Russia and Chile, the first South American startup applicant.
Yousif Al-Mutawa, Chief Information Officer at DP World, said: “This latest round reinforces the international flavor of the programme and proves that innovation is a global phenomenon. We are delighted to welcome the new applicants to Dubai, which once again is demonstrating its commitment to innovation in line with the vision of our leaders. DP World continues to take an active interest in establishing a culture of innovation in the UAE and Turn8 is a premier example of that effort.”
Teams have already been flown down to Dubai and will soon begin the four-month mentorship programme to refine their business idea and gain practical training on how to run a successful enterprise backed by seed funding of US $30,000 to help them develop their projects.
The start-up companies that were chosen for TURN8 round five are:
•SaveSpace (Dubai) – Offers local pick up/drop off of boxes to customers for storing their belongings.
•MedicSen (Spain) – A system designed for the intelligent and integrated treatment of insulin dependent diabetes mellitus.
•FairFare (Kazakhstan) – Helps service consumers in uncovering concealed prices by means of peer-to-peer information sharing.
•Mytriphoto (Chile) – Allows hotels to reach potential customers organically, improve online reputation and promote new sales with self-service photography
•Rewardial (Romania) – A blogging outreach and user engagement platform
•RealEye (Russia) – A mobile app that enables users to create their own route maps in cities between sites.
•MakersBuilders (Dubai) – The first educational institute of its kind in the Middle East, aiming to become the leading provider of technology education for children and teenagers.
•Foodiac (Finland) – A marketplace for private chefs and high-end catering.
•909Music (Dubai) – An online music library dedicated to licensing, producing and providing modern day, cutting-edge, quality rich music for media and avid music listeners worldwide.
TURN8 is a technology startup accelerator launched by DP World in 2013 to encourage innovation and entrepreneurship globally. Teams are selected from dozens of hopefuls that pitch their ideas at TURN8 events and via an online application.
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Always believe in your idea, and find first what can make it fail and then find what can make it succeed.
Today, for most of us is just a regular Thursday, but for me is a day that I will always remember because is the day when I reached to 1,000 users on the platform that I founded: LoadMe – The First Online Transporter’s Marketplace in the Middle East.
It all started one year back, when we were selected in a business accelerator:
A prototype was launched in January 2015 and in March 2015, a fully operational platform was ready. A lot of work and marketing efforts in the following months and in June 2015 it started to lift off the ground and before the end of August it reached to 1,000 users.
Starting from today I will not call it a startup anymore, I will call it a company because is one year old and it reached seamlessly an important milestone – 1,000 companies registered that are doing business on the platform.
I want to thank you first to this 1,000 companies who believed in us and are using daily our tool, and also I want to thank you to our partners for support because we would never be here without them: Turn8, DP World, Yellowstone Group and a few more.
For those of you who don’t know, LoadMe is actuality an online marketplace for shipments and trucks where you can find transport for your goods or you can load your empty trucks, some call it a Load Board some call it a Freight Exchange Platform and others call it The Uber for Trucks. If you are a logistics professional fell free to Register on LoadMe, be active and make your job easier by using our communication tool.
This is how it works:
Sebastian Stefan, CEO at LoadMe.ae – The Transporters Market from the Middle East
Swappaholics Holdings Limited, an innovative startup that recently graduated from the TURN8 Accelerator program (Round 4) in Dubai has launched a skills swapping portal, a disruptive platform, modeled after the barter trade system that will allow professionals to connect and swap skills in a social setting.
Skillz (www.skillz.io) is going to be a platform that is going to be a game changer in the online freelance ecosystem by allowing professionals to trade without the use of money. A platform where your skills become a social currency.
“We are breaking the monopoly of money, and empowering everyone with equal trading opportunities” says Francis Obirikorang, CEO and Co-founder.
Skillz will allow people to trade skills, build up their portfolio, connect and interact with like minded professionals, rent their skills and also contribute their skills for social good.
A website designer can design a website for a legal professional who in return will offer legal services in exchange for the website.
Currently, the main pain point facing many freelance websites is the need for money to trade, which is eliminating many people from trading due to little or no cash. “Everyone has a unique skill set which can be traded” remarked the CEO of Swappaholics. Its an ecosystem where everyone wins. With Skillz, your skills is your social currency.
Skillz is currently web based and the Android and iOS mobile applications will be launched by the end of 2015 to give users a multi channel approach to swapping their skills. Launched in Dubai, Swappaholics has plans of extending the Skills swapping portal to the other MENA regions with a global focus in mind.
We discovered TURN8’s call for applications by “accident.” We didn’t participate in the usual hackathon or “innov-a-thons.” Instead, a simple Google search for where to take our ideas popped up many accelerators accepting applications. Instinctively, we chose to apply to TURN8. There was something uniquely intriguing about the name. Two days after submitting an application, we got an email from TURN8 requesting a Skype interview between Swappaholics and Mohammed Hamdy, who was the Managing Director of the TURN8 program. “That escalated quickly,” I said to my co-founder Michael Ocansey.
The Skype interview lasted for about 30 minutes; questions relating to how we came up with the idea, what problem we sought to solve and how we planned on monetizing our application came in thick and fast. Hamdy was very precise and knew how to aim for the jugular with his intuitive and deep searching questions. One question that I termed the “shark attack” question was “are you ready to quit your full-time job and take up this venture?” At this point there was no turning back.
The interview ended with “you will hear from us soon.” A week later we were notified of our pre-selection. We were the first team to be selected for TURN8 Round 4. Due diligence stage commenced. Lots of paperwork; lots of emails were exchanged and we were officially confirmed. Dubai, here we come! We jetted out of Ghana on February 6, 2015, using Ethiopia Air. We missed the connecting flight and spent a day in Addis Ababa. It was a very cold experience and coming from a tropical country; we had to brace ourselves. We landed in Dubai on February 8 at approximately 4:00 AM local time.
First cultural shock. Checked into our prized room, what is locally referred to as a partition room. It was no bigger than a cubicle. We had to adapt fast. Then came the food. No African food in sight. Time we introduced our tongues and taste buds to different cuisines.
On February 9 it was time to head to The Cribb, where TURN8 teams work. Armed with a map and an RTA card we set off. Everyone gets lost once in a while in a new environment. We ended up at a different Al Qouz. You couldn’t blame us. We hailed a cab and phoned the TURN8 Community Manager who gave the directions to the cab driver. One team (Cabit, now Paack) had arrived early for the start of the program. We exchanged pleasantries with them and settled in to work.
The program officially commenced and boy was it an exciting one, covering topics like business modeling, financials and other important knowledge entrepreneurs need to acquire to help them become better managers and steer the affairs of a startup. Passion alone cannot guarantee the success of your startup. Choosing mentors is one key pillar of the TURN8 program and it helps startups get invaluable knowledge and coaching from people with industry knowledge. Mentors, I term them as “rudders of a ship,” help steer a startup and avoid errors that have the potential of killing it.
From pitching events, barbecue parties, prototype building, etc., TURN8 has helped shaped our perspective in the startup business. TURN8 is more than an accelerator; it’s a family that is bent on making everyone succeed. You are chided if you go wrong, encouraged and praised if you do things right. You learn not to take anything personal but rather strive to improve who you are. Many of us came into the program with only passion as a tool, but we have acquired enormous knowledge that can last a lifetime. It’s been one heck of an amazing journey and we have no regrets for joining this beautiful experience.
Now all pumped up, psyched up and ready we await the Investor Demo Day on June 13, 2015. It’s going to be a celebration of handwork from these 120 acceleration days. The Arabian night is going to be lit by beautiful ideas. Join us as we make history.
More about Swappaholics find here: http://turn8.co/swappaholics
Author: Francis Obirikorang, CEO at Swappaholics