TagICO

MENA’s Digital News, Week #14

A weekly round up of the top headlines from the digital sector in MENA, covering startups, corporate and the public sector.

This is probably the lightest round up yet, hopefully that means people are taking the time to wind down and be with their family, gearing up for a great 2019!

Investments & Acquisitions

VetCode, Egyptian pet-care startup, raises $450k in seed funding from PMaestro https://goo.gl/Dapbfk 

Sector News

Careem partnered with Dubai’s Roads & Transport Authority (RTA) to launch an eHail taxi joint venture https://goo.gl/RrrNmG 

Oyo, Indian budget hotel startup, that raised $1B from Softbank Vision Fund, expanded to UAE last April and has served more than 100,000 guests since https://goo.gl/kGzXR9 

Utopixar, Tunisian startup, receives funding from UNICEF’s Innovation Fund to solve global challenges using blockchain technology https://goo.gl/WCP1kf

AlRawi, Bahrain based audibooks platform, ​soon to be featured on Gulf Air flights https://goo.gl/XDVRp1

Emaar to partner with Tiktok to produce short-video content https://goo.gl/T5tL4c

Samsung bundles VOD services: MBC Shahid, Starz Play and Weyyak into new “SmartPack” offering – notably Netflix is excluded from the bundle https://goo.gl/tECX1M 

Egypt’s Meeza debit card holders will be able to use their cards for online purchases soon https://goo.gl/C9oeqJ

Abu Dhabi National Oil Company (ADNOC) and IBM piloted a blockchain-based automated system for oil and gas production management https://goo.gl/bfekrx 

UAE to finalize initial coin offering (ICO) regulations in mid-2019 https://goo.gl/eCdLne 

Further Readings

The Emirates Foundation (Abu Dhabi) to grant Google $300k to expand the “Maharat min Google” Arabic language digital skills initiative across the country https://goo.gl/znNBM4 

Schengen Nationals can now travel to Saudi Arabia with an eVisa https://goo.gl/gmJ638

Long Reads

An academic perspective about refugee entrepreneurship in light of recent wars in MENA “Call Me a Business Owner, Not a Refugee!” Challenges of and Perspectives on Newcomer Entrepreneurship” https://goo.gl/HH47nx

What I expect we’ll be seeing in 2019:

  • As regional investors have raised and announced big funds this year, it’s likely that we see a healthy increase in deal sizes, and follow on funding
  • More interest from international investors in the region
  • More Chinese and Asian companies companies expanding into MENA
  • Lots of IPOs are coming up for global players (Uber and co), which will lead to even more aggressive competition as stock markets are becoming cut-throat and unforgiving. (There might be some valuation corrections there as well)
  • Expansion of global players into MENA will be a wake up call for many regional startups (or unicorns) to improve their services
  • This may be the year that P2P payments finally makes it to in MENA – mobile payments in almost there for some markets, and even countries like Egypt are working on improving online payments (finally)
  • A maturity in the crypto / blockchain hype cycle. A lot of people have and will lose a lot of money in the process, but at least we’ll have a guide on what NOT to do.
  • More global regulations on Crypto currency and assets
  • More content creators = more fragmentation of market = people will pirate more as the options to watch all the shows and movies become too cumbersome to deal with
  • A clear gap in the “favorite” social network space leaves the space open for unlikely new players.
  • Over valuations may kill a startup or two.

See you in 2019!


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I won’t buy Cryptocoins to use your service (1/2)

3 minutes

cryptocoins bitcoin eth litecoin

A few weeks ago I was at a startup conference and the inevitable happened: I met a talent-marketplace (hire-a-freelancer) startup that planned to sell their own crypto-coins to be used as tokens on their platforms before launching their product…

Me: Why would I buy your coin / token?
Founder: To use the service and pay for the freelancers
Me: But, why can’t I pay in dollars?
Founder: But that’s the whole point…
Me: I don’t get it. Why would I use your service if I need to buy a specific coin and carry the burden of all the exchanges…

and it’s true, I won’t. Nor will anyone else.

The craze of crypto-currencies is in it’s peak; there are over 1,500 coins listed on CoinMarketCap. It doesn’t make sense for an individual to have a wallet full of coins and tokens lying around in case they need to use one or the other, add to that the accumulated cost of moving the coins and exchanging them.

In the example above the founder was hoping to use his token as a currency, but had forgotten one small glitch: the user. A talent marketplace requires a high adoption rate to survive as it makes money from taking a small percentage of payments and occasionally advertising (other revenue streams apply, but these are the most straightforward). For that, the founders need to aim for high adoption and retention rates, and decrease barriers of entry.

As a first time user, the need to buy a token to access the service is an immediate obstacle.

  • How many companies/individuals that hire freelancers have access to crypto-wallets, coins, etc?
  • How many are willing to buy coins that they may or may-not choose to convert back to ETH or BTC later.
  • You have already lost the client to thinking of how they’d get into your service, instead of placing the solution to their outsourcing problem at the core of your offering.

adoption rates for common technologies today, the cyrpto one is yet to show up

Major tech companies and upcoming ones are, will, and have considered ICO (Initial Coin Offering) as an alternative funding method to traditional investors or IPOs (with their lengthy processes). However, we are in the peak of hype over crypto-currency, and it’s still a super high risk enviroment. As an idea stage startups, the odds are already against you, so unless your startup’s core function is crypto-related, maybe it’s best you focus on your business.

There are many technologies that will disrupt the market and the rate of change will only increase in the next few years. Founders have to embrace changes and adopt new technologies on the go, but they also need to take calculated steps that they won’t regret.

Are you considering launching an ICO, considering the following:

  • How will this affect my core business?
  • How will this make the consumer experience on my platform better?
  • Am I forgoing potential venture capital support (financial and non-financial) that could help grow my business?
  • Can I withstand an un-forseen drop in overall crypto-valuation?
  • Do I understand how this technology works well enough or will I be at the mercy of my developers. Can I hire, retain and grow the right team to help me on this path?
  • If I’m paid in crypto-coins by my network, how do I plan to pay my existing non-crypto liabilities? Can you liquidate?

My two cents: Most people will pay for your service or product in their respective currency, your system will token-ize that value and run the service as needed. The average consumer will not need to know how, where and why. Your system will need to be optimized for the customer’s most seamless experience and your products best productivity. 


P.S. I do own some cryptocurrency (BTC and ETH). I’m not against crypto-currencies, I just see that the hype is deluding startup founders’ attention a tad too much.