tweetup startups 18 oct 2011 (abraham karmack)

Starting Up Knowledge Businesses in Qatar

Advice from the trenches…

Abraham Kamarck & Haya Al Ghanim

Doha Tweetups18 October, 2011

Or what we’ve learned in the last year ...in 10 minutes or less

In the last year, we’ve changed strategies almost on a weekly basis

The reality of the environment is that we are bleeding edge and need to

maintain to succeed in the long-haul

The Start-Up Paradox….To create something great, you must be both Patient & Impetuous at the same time….Impetuous = hasty and precipitate in action

The Start-Up Paradox….It’s like running a Marathon, you have to be ready to go the distance…but you can’t ever stop running.

The Start-Up Paradox….

Success can only be judged over time.

Steve Jobs was once fired from Apple (1985).

There will be major ups & downs.

The Start-Up Paradox….Start-ups are difficult everywhere, but they are especially hard in Qatar.

WHY???

Because…..

QATAR is a START-UP

“Tiny Qatar’s Big Plans May Change Mideast” – Bloomberg

Business Week

“Qatar, Punching Above it’s Weight..”

– Foreign Policy

Qatar is trying to do what no one has ever done before…

…and what no one thought Qatar could do…

Which is a bigger accomplishment?

Qatar is a start-up. 2030 is still a long way away.

Everything in Qatar is constantly changing.

And we ALL need to help realize 2030.

We have to keep running.

As Start-Ups we have to Help Build the Start-Up EnvironmentSo now let’s talk about the Start-Up Environment in Qatar…

#StartUpQatar

Start-up Myths in Qatar

1. Qataris are not entrepreneurial…

2. I only need the expat market…

3. 2022……..

4. I have a start-up, IF….

5. Franchises = Gold

The Current Challenges…

1. Direct Challenges

2. Systemic Challenges

3. Cultural Challenges

Direct Challenges (just a few)

Online Payment Gateway Set-Up Fee: Q.R. 28,750

#QNBFail?

Also,• Municipal Registration requires Commercial Offices• Licensing Problems

Systemic Challenges(1) Last 10 years growth has been funded by Government Spending. (Directly & Indirectly)

Q Companies

Hire Staff and Pay Salary & Benefits

EmployeesSpend on Rent, Retail, Restaurants and Range Rovers

Systemic Challenges

(2) HIGH…no Seriously, Seriously, Ridiculously HIGH Asset prices

Doha has the 12th most expensive office space in the world (QR3,248 or $887 per m² per annum).

Only MENA country in the top 20

Most expensive space in the world when adjusted for office population.

#QatarRentOuch

Systemic Challenges(3) The Talent Vacuum

Lindsay Lohan is often called a “Talent Vacuum”

The Talent just isn’t here in the needed numbers yet…

There are only 200K “White Collar” workers in QATAR*

The Problems:• Young Qatari population• Sponsorship System• High Asset Prices

The Seeds of the Solution: QF & Al JazeeraPlus….Doha is not ready (traffic, schools, sewage?)

*qix.gov.qa

Cultural ChallengesThe Cultural Barriers to Knowledge Growth

1. The Majiles Scenario - “Your Successful, Know-it-all Uncle.”

2. The Paradox of Success – “What got you here, won’t get you there.”

3. Sweat Equity – “Ideas are Cheap, Execution is Everything.”

4. Angel Investors or the lack of them

Angel Investing…a snapshotAngel Valuations are difficult because there is often not much to value, so industry norms develop

In the US an Equity Norm is 20% for a US$ 500K investment.We need a norm for Qatar. i.e. 20% for QR 500K

Source: Mark Suster, www.bothsidesofthetable.com

#QatarAngels

Start-Up Opportunities in QatarAreas with the greatest potential for scalable growth(The Big Bets)

#NewEconomy - Everything needs to change e.g. Sustainable Solutions, Smart Manufacturing

#SOCENT – “Bottom of the Pyramid” Strategy

#HUB – Media, Education & Research

#FailWell – You Are Going to Fail

#FailWell

#FailSmart

#FailFast

In the VC business, if you hit.300, you are doing well. If you hit .400, you are going to the hall of fame. But it is how you behave when you strike out that defines your reputation. No throwing bats.

- Fred Wilson

Now Go!…and Don’t Stop Running

Thank You!