Rather than lazily copying existing global tech fads, Jordanian entrepreneurs would be wiser to focus their efforts on meeting the needs of the region.
Startup Jordan- Robert Carroll
Delivery startups for pets, apps that share photos in unnecessary ways, and messaging platforms that either limit you to one word, or self-destruct after opening. These are the hallmark startups of a new generation of technology companies, and they’re raising absurd amounts of venture financing around the world—sometimes in the hundreds of millions of dollars.
But if these are the new drivers of our global economy, I’d like a different economy. Fortunately, I’m not the only one who expects more from business and technology. Vivek Wadha of the Washington Post recently wrote: “My concern is that the adulation and funding that [these startups have] received will send a terribly wrong message to entrepreneurs all over the world, encouraging them to misdirect more investment into building more silly apps and other equally meaningless, mindless projects.”
As more young entrepreneurs become interested in tech startups, we run the risk of misdirecting their efforts. We don’t want them to confuse the word “startup” with words like “social media” or “smartphone app.” They’re not the same. In fact, some of the best startups can look less like Facebook and more like a traditional business. Consider Bonobos, a startup that raised $128 million in its few years of operation. What do they do? They sell trousers. You choose a pair online and they send them to you. It sounds a lot like how trousers were sold 50 years ago, but now with a website.
Startups are supposed to be scalable and profitable, but they’re not required to follow all the latest—and often quite questionable—trends.
One obvious problem is that many startups pursue business models that rely heavily on advertising as a revenue stream. Christopher Mims of the Wall Street Journal warned entrepreneurs: “The entire market for advertising is around $100 billion a year in the United States (globally it’s close to $500 billion.) Yet the [U.S.] gross domestic product is more than $16 trillion.” Advertising is a very limited market, and while it can be a source of revenue, there are many other ways to run a business.
As a nation, Jordan is well positioned to lead the region in terms of fresh ideas and scalable startups, but we don’t have enough resources to spend on “mindless projects” that only reward a few founders and early investors. The MENA market is full of real needs that are waiting to be filled, and there is no time (or capital) to waste on what Silicon Valley often portrays as “innovation.” If you have any entrepreneurial leanings, consider these industries, which are ripe for disruption and awaiting your ingenuity.
Financial Services Technology or “Fintech”
The financial sector in the MENA region is slow to move. People have money in their wallets and it should be much easier for them to spend it. When consumers spend, markets become more liquid and everybody wins. Payment gateways, personal finance, and investment management are all ripe for disruption. Investors are putting about $3 billion every year into fintech, and it’s forecasted to grow up to $8 billion per year by 2018. That’s a lot of money that’s looking to invest in new startups.
Housing, Transportation, and Infrastructure
As regional turmoil continues unabated, Jordan will consistently be viewed as a safe haven for refugees. Regardless of how these refugees enter Jordan or where they come from, they will continue to increase demand for housing and urban infrastructure. There are many opportunities to make buying and selling, construction, and transportation a more convenient and simple experience.
Jordan already produces the lion’s share of Arabic content on the web, but I don’t think we’ve reached any sort of ceiling on what can be produced. Internet penetration is rapidly increasing across the region and viewers around the world will always want to see more content in Arabic. That means increasing demand for everything from entertainment to news.
Opportunities abound to disrupt several industries in the MENA region, and Jordan is still the best place to do it. I believe that entrepreneurs who focus on real problems will be met with more receptive customers and have a higher chance of success.