“It´s in the DNA of the locals to be entrepreneurial and commercial,” said John Tate, chief executive of Tamkeen, when he addressed the packed audience at the fourth Angel Rising at NYU Abu Dhabi recently.
He recalled how some years back he planned startAD with Ramesh Jagannathan, managing director of startAD and vice provost for innovation and entrepreneurship at NYU Abu Dhabi, and he says he is delighted that today UAE is home to 42 per cent of the Mena start-ups, followed by Egypt in second position with 12 per cent. In the Global Innovation Index (GII), the UAE is ranked the first among the Arab countries and the 35th worldwide in 2017. The GII is co-published by Cornell University, Insead, and the World Intellectual Property Organisation, an agency of the United Nations
At the Abu Dhabi event in March, investors and entrepreneurs heard presentations on investment in technology, start-up acquisitions and blockchain integration at corporate level.
Jake Zeller, partner at the US-based investor platform AngelList, gave some tips on how to navigate investments in technological start-ups. “We call ourselves the backbone in the Silicon Valley,” he said regarding what he sees as four core areas of consideration: an investment platform; a recruiting market place for start-ups; a market platform for acquiring customers; and cryptocurrency compliancy services.
“In the investment platform we connect start-ups with investors, we make $200 million to $300m per year in investments mostly in the early stage start-ups,” he said. The firm registers about one million introductions each year between start-ups and job seekers, he said. “We connect start-ups with designers, engineers and other people to build your business. In terms of start-ups recruiting, we are bigger than LinkedIn, we have 6.5 million users and 500,000 companies.” AngelList also acquired Product Hunt, a platform that helps companies find their initial customers and there have been 100,000 views of its content.
“Our latest venture is CoinList, a cryptocurrency compliant services company. CoinList made $206m in its first deal,” he said.
The new venture serves as a goal for start-ups of all type but especially those targeting the fintech sector. Last month, CoinList announced it had closed $9.2m in its initial fundraising round. Among its investors is a group of the industry's most notable cryptocurrency funds: Polychain Capital, Digital Currency Group, FBG Capital, Libertus Capital, Blockchain Capital, CoinFund and Electric Capital. "This successful fundraising round reflects the growing need that promising blockchain companies have for superior token sale compliance and execution," CoinList co-founder and CEO Andy Bromberg told PR Newswire at the time.
Barry Silbert, founder and CEO of Digital Currency Group, said: "CoinList has emerged as a leader that has uniquely developed credibility with the three most important stakeholder groups – entrepreneurs, investors and regulators.
The fundraising round capped a seven-month stretch in which CoinList processed more than $400m in cryptocurrency investments through its infrastructure, with thousands of accredited investors on the platform.
AngelList started with an email list, according to Mr Zeller. In 2010, it offered introductions to Uber when the US ride-hailer was valued at just $4m. A $250,000 investment in the firm then then would yield around $90m today.
“Technology has changed the world of start-up companies,” Mr Zeller said. In the pre-Facebook era companies had to acquire customers individually, while now you get a person to authorise you access to the user's Facebook profile and friends network, so you can acquire your 100 million users through that social media. Mr Zeller calculates that in the past 20 years, the number of internet users has grown in a 73 fold and the amount they spend online has grown approximately 19 fold. The online user numbers have grown from 53 million in 1997 to the current 3.89 billion, and the average amount spent per year in 1997 was US$72 per user and now is $1,375.
“The addressable market is 100 times bigger but the cost of starting a technology company is down by a factor of 10," he said. "Every dollar you invest in a start-up today is a thousand times more leveraged that it was 20 years ago. As an expample, Mr Zeller cited Whatsapp. The messaging company that has 450 million users began in 2009 with 35 engineers and 53 employees. In 2014, it sold for $19 billion when Facebook snapped it up. “Never before was this hyper-value creation possible with so low resources and so quickly.”
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Read more:
Generation start-up: The entrepreneur nurturing Baby Arabia one step at a time
Silicon Valley’s Plug and Play woos Gulf banks for deals with its fintech start-ups
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Mr Zeller recommended investors keen on technology investment to start by consulting experts, setting a budget and diversifying the number of deals over time, because no one knows when the next unicorn will canter on to the stage. “When you set your budget, plan to make one tenth of your available amount each year for the next 10 years. We recommended being patient because an asset class takes time to build.”
“In the Mena region, [investors] are valuation sensitive. One of the challenges here is to try to scale, and sometimes growth is slower, so you negotiate lower valuations than in Silicon Valley because you want to make sure you are getting compensated for taking the risk.”
Mr Zeller said the trends in initial coin offerings (ICOs) of cryptocurrencies as opposed to traditional venture capital was a concern. “There is crazy stuff happening, a team with a white paper and 3 employees raising $200 million." But he said that was unlikely to remain the case. "I think .... instead or raising $200m in ICO, you raise $2m in ICO and then if you do well, you raise another round of funding, and another ICO and it will scale to a more traditional, series A and series B model. I think what is happening now is not sustainable.”
Delegates also heard about the importance start-ups being prepared to be acquired and of maintaining their innovative edge after being bought. “Problems of today are the solutions of yesterday,” reflected Saeeda Jaffar, managing director and Middle East office co-head of Alvarez & Marshal Middle East. “The challenge is how you can preserve that founders' mentality from being able to execute quickly to being an organisation that is more standardised. Most of the time, it will not work,” she saisd.
“Founders have to focus on the culture they want to create and identify the working style they want."
If innovation is across the entire organisation, she said, there is a chance to collaborate and therefore maintian the culture of entrepreneurialism. "Normally, when they are acquired, innovation stops.”
Ms Jaffar said another challenge for investors was choosing who to put money into. “There are so many different companies out there, how do you pick the winners?” She advised that they seek out business ideas that makes sense and that solve real problems; that the start-up has an effective team, and whether the start-up fits with their current portfolio of investments.
But Christos Mastoras, founder of Iliad Partners and co-founder of Glambox, pointed out that start-ups should keep in mind that building a good business was primary rather than thinking about being acquired. Investors in the region, he said, look for three signals: “They look to tap into growth and technology is a driver; they invest in technology as a defence mechanism for competition or not to be disrupted; and they tap into innovation.”
Blockchain technology was also discussed at the Angel Rising event. Lina Hediah, executive director of Consensys, pointed out that it was still a nascent arena. “So far, every large corporate and financial institution is experimenting with blockchain,” she said. “The regulatory framework is still not there."
Jonathan Nelson, founder and CEO of Hackers/Founders, pointed out some basic thoughts investors should bear in mind: “My rule of thumb is that if the entrepreneur can't explain in a way you can understand and it feels fuzzy, a lot of times it is because the start-up is fuzzy.”
Rahul Pai, COO of UAE Exchange, said to evaluate a company using blockchain, there are three main features to consider: transmission data; reconciliation of payments; and real-time settlement. Blockchain disrupts in the latter, “but it is an unregulated space”, he said.
Ahmed Al Qassim, CEO of Emirates NBD Capital-Investment Banking, said the growing start-up ecosystem of the UAE and wider region was encouraging: “The scene has changed in two years. We did not have a proper ecosystem [before', but now the scene is changing positively."
Specs
Engine: Dual-motor all-wheel-drive electric
Range: Up to 610km
Power: 905hp
Torque: 985Nm
Price: From Dh439,000
Available: Now
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
Email sent to Uber team from chief executive Dara Khosrowshahi
From: Dara
To: Team@
Date: March 25, 2019 at 11:45pm PT
Subj: Accelerating in the Middle East
Five years ago, Uber launched in the Middle East. It was the start of an incredible journey, with millions of riders and drivers finding new ways to move and work in a dynamic region that’s become so important to Uber. Now Pakistan is one of our fastest-growing markets in the world, women are driving with Uber across Saudi Arabia, and we chose Cairo to launch our first Uber Bus product late last year.
Today we are taking the next step in this journey—well, it’s more like a leap, and a big one: in a few minutes, we’ll announce that we’ve agreed to acquire Careem. Importantly, we intend to operate Careem independently, under the leadership of co-founder and current CEO Mudassir Sheikha. I’ve gotten to know both co-founders, Mudassir and Magnus Olsson, and what they have built is truly extraordinary. They are first-class entrepreneurs who share our platform vision and, like us, have launched a wide range of products—from digital payments to food delivery—to serve consumers.
I expect many of you will ask how we arrived at this structure, meaning allowing Careem to maintain an independent brand and operate separately. After careful consideration, we decided that this framework has the advantage of letting us build new products and try new ideas across not one, but two, strong brands, with strong operators within each. Over time, by integrating parts of our networks, we can operate more efficiently, achieve even lower wait times, expand new products like high-capacity vehicles and payments, and quicken the already remarkable pace of innovation in the region.
This acquisition is subject to regulatory approval in various countries, which we don’t expect before Q1 2020. Until then, nothing changes. And since both companies will continue to largely operate separately after the acquisition, very little will change in either teams’ day-to-day operations post-close. Today’s news is a testament to the incredible business our team has worked so hard to build.
It’s a great day for the Middle East, for the region’s thriving tech sector, for Careem, and for Uber.
Uber on,
Dara
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The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
The Specs
Price, base Dh379,000
Engine 2.9-litre, twin-turbo V6
Gearbox eight-speed automatic
Power 503bhp
Torque 443Nm
On sale now
Specs
Engine: Electric motor generating 54.2kWh (Cooper SE and Aceman SE), 64.6kW (Countryman All4 SE)
Power: 218hp (Cooper and Aceman), 313hp (Countryman)
Torque: 330Nm (Cooper and Aceman), 494Nm (Countryman)
On sale: Now
Price: From Dh158,000 (Cooper), Dh168,000 (Aceman), Dh190,000 (Countryman)
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
Ziina users can donate to relief efforts in Beirut
Ziina users will be able to use the app to help relief efforts in Beirut, which has been left reeling after an August blast caused an estimated $15 billion in damage and left thousands homeless. Ziina has partnered with the United Nations High Commissioner for Refugees to raise money for the Lebanese capital, co-founder Faisal Toukan says. “As of October 1, the UNHCR has the first certified badge on Ziina and is automatically part of user's top friends' list during this campaign. Users can now donate any amount to the Beirut relief with two clicks. The money raised will go towards rebuilding houses for the families that were impacted by the explosion.”
Seven tips from Emirates NBD
1. Never respond to e-mails, calls or messages asking for account, card or internet banking details
2. Never store a card PIN (personal identification number) in your mobile or in your wallet
3. Ensure online shopping websites are secure and verified before providing card details
4. Change passwords periodically as a precautionary measure
5. Never share authentication data such as passwords, card PINs and OTPs (one-time passwords) with third parties
6. Track bank notifications regarding transaction discrepancies
7. Report lost or stolen debit and credit cards immediately
'Laal Kaptaan'
Director: Navdeep Singh
Stars: Saif Ali Khan, Manav Vij, Deepak Dobriyal, Zoya Hussain
Rating: 2/5
From Europe to the Middle East, economic success brings wealth - and lifestyle diseases
A rise in obesity figures and the need for more public spending is a familiar trend in the developing world as western lifestyles are adopted.
One in five deaths around the world is now caused by bad diet, with obesity the fastest growing global risk. A high body mass index is also the top cause of metabolic diseases relating to death and disability in Kuwait, Qatar and Oman – and second on the list in Bahrain.
In Britain, heart disease, lung cancer and Alzheimer’s remain among the leading causes of death, and people there are spending more time suffering from health problems.
The UK is expected to spend $421.4 billion on healthcare by 2040, up from $239.3 billion in 2014.
And development assistance for health is talking about the financial aid given to governments to support social, environmental development of developing countries.
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Killing of Qassem Suleimani
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Ms Yang's top tips for parents new to the UAE
- Join parent networks
- Look beyond school fees
- Keep an open mind
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Election pledges on migration
CDU: "Now is the time to control the German borders and enforce strict border rejections"
SPD: "Border closures and blanket rejections at internal borders contradict the spirit of a common area of freedom"
UAE currency: the story behind the money in your pockets
The specs: 2018 Ducati SuperSport S
Price, base / as tested: Dh74,900 / Dh85,900
Engine: 937cc
Transmission: Six-speed gearbox
Power: 110hp @ 9,000rpm
Torque: 93Nm @ 6,500rpm
Fuel economy, combined: 5.9L / 100km
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
The%20specs
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The%20specs
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%206.5-litre%20V12%20and%20three%20electric%20motors%0D%3Cbr%3E%3Cstrong%3EPower%3A%20%3C%2Fstrong%3E1%2C015hp%0D%3Cbr%3E%3Cstrong%3ETorque%3A%20%3C%2Fstrong%3E1%2C500Nm%20(estimate)%0D%3Cbr%3E%3Cstrong%3ETransmission%3A%3C%2Fstrong%3E%20Eight-speed%20dual-clutch%20auto%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%3C%2Fstrong%3E%20Early%202024%0D%3Cbr%3E%3Cstrong%3EPrice%3A%20%3C%2Fstrong%3EFrom%20Dh2%20million%20(estimate)%3C%2Fp%3E%0A
