Lebanoninnovation ecosystem

Following the Arabnet conference in BeirutMarch 2014

We believe…

Innovation has no place in a global world, it’s everywhere

Innovation ecosystems can learn from one another

Local context matters and should be a source for innovators

This is why…

We’re on a world tour of innovation ecosystems!

History & context of innovation in Lebanon

Merchants, turmoil, and entrepreneurs in the Levant

A brief history of Lebanon innovation ecosystem

• From WW1 to WW2: The French missionaries take the place of Ottomans and set up schools which will make part of the Lebanese political & business elite

• 70s-90s: Civil war, Israeli occupation of South Lebanon plunges the country into civil war and accelerates the diaspora movement, making ideas and cultures even more diverse

A brief history of Lebanon innovation ecosystem

• 2010: the first startups appear in Lebanon, mostly copycats, which “train” a first batch of startupers to try to scale and fail

• 2012+: First batch of more original & innovative startups, such as Instabeat (smart swimming goggles) and Instabug (bug fixing for app developers)

A brief history of Lebanon innovation ecosystem

• 2013: More and bigger funds pop-up even with troubles in nearby Syria, bigger deals are done (Funds like Berytech: $30M, MEVP: $50M)

• 2014: The Central Bank launches the “proposal 331” with $400mn to be invested in the knowledge economy via banks, a boost worth 1% of Lebanon GDP ($42bn)

A diaspora 3x the size of the motherland pop

• More than 12M diasporans for a country of 4.5M inhabitants• $7.5bn remittances back to Lebanon in 2010 (18% GDP)• Famous diasporan: Carlos Ghosn, Carlos Slim, Shakira, 2 Nobel Prizes…

A land of diversity

• Despite turmoils, Lebanese are a diverse people open to innovation, with a high mobility of capitals, ideas, foreigners

• A tripartite way of governance rule the country. At home, 70% Muslims, 30% Christians. In the diaspora, 70% Christian, 30% Muslims.

Not the best infrastructure in MENA…

• Cost of connections is high, with 180$ for 20G, 6$/Go when average salary is $600-$800. High cost of electricity, rent.

• Smartphone penetration increasing sharply (Android) but still lagging at 45% (Egypt 26%, Saudi Arabia 60%, UAE 73%)

… but fast growing and fond of apps

Asia 27%

• Huge bump in smartphone equipment in 2013• 70% of smartphone users in Lebanon have downloaded apps

Source: Alfa Telecom presentation at Arabnet 2014

Online & tech landscape of Lebanon

• Cost of connections is high, with 180$ for 20G, 6$/Go when average salary is $600-$800

• Smartphone penetration increasing sharply (Android) but still lagging at 45% (Egypt 26%, Saudi Arabia 60%, UAE 73%)

Source: Alfa Telecom presentation at Arabnet 2014

Regional instability

• Beirut-Damas: 90km• Flight time from Dubai to Beirut: 2100km in 4h30 (1h of

additional detours to avoid Jordan, Israel, Syria, Irak)

Startups to watch for

• Lebanese startups reach beyond borders thanks diasporans• New $400m proposal 331 from Central Bank with have a lot

new startups pop-up in Beirut

Dermandar: 360 photo-sharing app, 4M users worldwide

Analytics & CRM startup Woopra: 100K users

Instabeat: connected swim goggles Spotify for the MENA region

Sohati: the Arabic speaking health forum

2nd-hand certified luxury bags

Localization & Translation services

Lebanon innovation ecosystem today

Pros & Cons, Top Connectors & local best practices

Pros and cons of Lebanoninnovation ecosystem

• Diverse and tolerant population, prone to innovation

• Lot of money for the knowledge economy thanks the Proposal 331 from the Central Bank ($400m)

• Access to a huge diaspora to conquer other markets and a tradition for trade and negotiation

• Home of the main tech regional event, Arabnet, with satellites in Dubai, Ryadh

• Small market with big competition around (Israel tech hubs, Jordan more stable and forward going)

• Infrastructure can be both expensive and not reliable, with $180 for 20Gb on the web

• Expensive country in the Middle-East comparatively to neighbors such as Jordan

• English is understood by the geek, business and elite, but Arabic still needed with most of the local population

• Unstable country with frequent bombings, surrounded by countries which regularly threaten its independence (Israel, Syria)

PROS CONS

Top connectors in Lebanon

Omar Christidis (Twitter), founder and CEO of Arabnet, MENA’s main tech event in Beirut,

Ryadh, Dubai

Fawzi Rahal (Twitter), Founder, Managing Partner @gamuttco Digital Consultancy, creative

strategist, ex-head of digital at Grey MENA

Walid Hanna Managing Partner (Website), Middle East Venture Partners (MEVP)

Raafat Moulna (LinkedIn), Senior Head of Marketing Department at Alfa Managed by

Orascom Telecom

Top connectors in Lebanon

Hind Hobeika (Twitter), former professional swimmer, CEO and founder of Instabeat, the

award-winning connected swim goggles

Joanne Kubba (Twitter), Head of Strategy, Partnerships & Outreach at Eureeca, former

Google head of public affairs for the MENA region

Ramzi Rizk (Twitter) Co-founder, EyeEm, one of the biggest community for photographer, based in

Berlin

Maroun N. Chammas (LinkedIn), established entrepreneur. He is Chairman and CEO of

Berytech and Chairman of the Berytech Fund

Best practices of Lebanon innovation ecosystem

• Circular 331 from Central Bank of Lebanon puts $400m on the table for the knowledge economy. This money will help banks to fund accelerators and incubators, but could cause a bubble

Best practices of Lebanon innovation ecosystem

• Arabnet is the MENA top tech conference with satellites (Dubai, Ryadh) mixing both the tech and the digital marketing communities.

• It’s also a ramp for local talent with several level of competition: Ideathon (project holders), Startup Demo for established players and Creative Combat for creative advertising teams

Best practices of Lebanon innovation ecosystem

• Beirut Digital District is a space in town dedicated to the tech startups, with shared offices and events.

• Three phases are planned until 2023 for building a campus-style tech community

What’s next for Lebanon

Attract talent and founders thanks to the $400m envelope from the Central Bank. Local talent won’t be enough. Create hassle-free visa for skilled and hungry youth from surrounding countries

Tap into the diaspora’s power, especially with its links to the US and South America, which are respectively the epicenter of innovation and one of the largest lagging market for tech.

Expand Arabnet as the key event of all Arabic speaking countries, from Morocco to Levant and beyond, to leverage on a huge network which breaks traditional borders.

Eager to learn about the other innovation ecosystems?

Documenting innovation through key events Hot posts, interviews, live-tweet, Google Hangouts

Identifying key connectors on & offline

Discovering alternative and emerging innovation ecosystemsBeyond the Silicon Valley, local innovation hotbeds

Tech, Social impact, Education, Life Sciences…

Increasing mobility of innovators and ecosystem enablersConnecting doers and thinkers through monthly Hangouts

Offering innovation ecosystem enablers to learn and exchange from peers

About our project A world tour of innovation ecosystems

Martin Pasquier

Entrepreneur in Singapore (social media

agency), long-time traveller

Mixes economics, politics and travels to analyze ecosystems,

reports on innovation

About our teamAnalysis, community & network

Anne Lalou

CEO of Innovation Factory & Web School

Factory in ParisTransfer knowledge of

ecosystems to new generation and to a

network of top French companies

Nicolas Loubet

Serial entrepreneur in Paris

with 3 companies, growth hackerManages and

nurtures creative communities on & offline

Catch us if you can! Roadmap ‘13-’14

SUPPORT US! Travel & time of exploration isn’t free Custom reports on emerging markets & trends Workshops, talks on innovation trends Connection to key local players for VCs, brands, tech communities

Links & resources to know more about Lebanon innovation ecosystem

RessourcesMore on Lebanon startup & innovation scenes

• 13 Quick Stats about Internet Usage in the Middle East (Wamda)

• Ipsos ArabNet Beirut 2014 (Slideshare)• Top 15 MENA Tech Startups That Are Going Global (Wamda)• ARABNET 2014: THE INTERVIEW WITH OMAR CHRISTIDIS (

Tech Ticker)

Thanks!

Martin Pasquier, for Innovation is Everywheremartin@innovationiseverywhere.com