The challenges Tech Startups face in times of economic and political uncertainty.
It’s past midnight, as all Lebanese now I sit in pitch darkness with my thoughts for company. We are in a nation-wide blackout for weeks now.
MacBook at hand, battery still charged and sleep out of sight due to a complementary free heatwave, I look at my glass of bourbon and it whispers to me that I got a story to talk about.
Many will tell you that tech startups are fun. You get to be in the spotlight with your innovation/s.
You get to grow from scratch, learn, network, use your connections, plan and execute. Hopefully seeing some success too in the end after a few course correcting pivots along the way on this winding journey.
As founding CTO of a current tech startup with nigh 2 decades of previous work experience locally and abroad, I can attest to many of those aspects.
But the full truth is that most startups fail also, so in the same measure tech startups are far from joyous trips down leisure lane or nostalgia boulevard.
Lack of clarity, failures, challenges, fatigue, hours glaring at monitors glow in the dark all adorn the hallways of startups with sprinkles of occasional pain and doubt to support you.
You have to deal with project concept and execution, market studies, MVPs proof of concept, alpha/beta testing and bringing the product to market. Responsibility, funding, team building and management. Project planning, sourcing, scheduling, sprints, registration, trademarks and product development. The list of responsibilities and challenges is quite comprehensive and each point is worthy of a separate detailed discussion.
It’s a far cry from running an established bank or bakery business from 9 to 5 where the supply/demand, gear-work, personnel and paperwork already exist in place like clockwork. But the challenge of overcoming all these big and small mountains is a reward in itself to be honest.
To go from a promising lone prototype to a trusted growing revenue generating business model is a real world survival graduation ceremony.
Tech is only part of it though, you need proper business development, management, branding, marketing, design and sales.
You read about it a lot in startup books who recount to you a bevy of startup success stories and tips like Eric Ries’s books, but to navigate the troubled waters successfully yourself makes you proud of your product vision, luck and cohesive team that professionally stood firm and navigated the ship to the safety of the lighthouse through countless siren calls, giant krakens, storms and sea scurvy. Old sunken ships standing as testaments to your persistence.
The aforementioned process every startup will go through it and is challenging enough, but for many startups in unstable regions of the world, these hard points are just half the story.
So in this article i want to share that other half, the dark side of the moon experience and I hope it echoes honestly the experience and concerns of many other startups in Lebanon as well.
Like many other startups around the world, the outbreak of Covid-19 did affect us directly and our bottom line, but as tech startups we are already adept to some degree at working remotely, so the overall negative effect of the quarantine is manageable to a considerable extent therefor i will not list it as unique to startups in Lebanon.
In Lebanon tech startups unfortunately suffer from additional types of mounting challenges, some of which are also shared by troubled countries around the world including some few points by the USA to a minor extent it seems lately.
Political Instability:
This is draining us for the last couple of years. This drives young and old experienced talent to leave and immigrate with no replacement in sight. In addition, protests, riots, the sudden closing of roads all make it difficult or near impossible to go to and come back from work sometimes.
Economic Collapse:
Lebanon now suffers also from inflation, multiple currencies and exchange rates, blocked bank funds, not being able to buy online or even pay servers anymore. All this constitutes a nightmare to navigate logistically.
Community Isolation:
The tech startup scene in Lebanon is isolated unfortunately from almost all major movers and shakers in the technology field in the West. Payment gateways and ecommerce platforms like PayPal, Amazon, Kickstarter and Stripe don’t support integration with Lebanon. Neither do any of the major Silicon Valley companies support the Lebanese tech community in any advisory/mentoring/networking/funding/grants role.
It’s like we are not on the world map. At least we can still access for now Google, Azure and AWS servers if we can still pay for them..
University Confusion:
The local universities graduate a considerable amount of software engineers, but many universities don’t take the extra needed step of preparing their graduates for immediate real world employment by exposing them seriously to the technology stacks that are currently in use and in need by tech companies. Nor to the open source spirit. There is a clear technology adoption lag that other much smaller local establishments are trying to smartly address and fix like SE Factory by training juniors on existing technologies and graduating them with associated projects to put them in touch directly with hiring companies.
Broken Infrastructure:
The basics of startup life like fast reliable internet and electricity are none existent. Outages and expensive very low speeds/quotas are rampant and are now considered a given. This boggles the mind in 2020 and is a testament to the tenacity of Lebanese startups that against all odds can still manage to operate in any fashion under such harsh circumstances.
No Government Support:
There is currently no government funding support to any of the technology sector companies in Lebanon. A few years back in coordination with the central and private banks a Circular 331 fund was put in place to encourage promising Lebanese tech startups. But that fund has been frozen for a while now after only a few startups were funded and went bust. The jury is still out on who is to blame for this outcome.
No Serious Supporting Networks:
Many established Lebanese technology companies focus on servicing their own client base locally and abroad and are not tech startups themselves so they do not possess the means nor know-how to help smaller tech startups become successful in creating brand new products and IPs. In addition many incubators offered limited mentoring and networking for tech startups. Investing small sums in return for relatively big percentages of the tech startups would stifle any growth before it began.
Brain Bleed and Few Success Stories:
We have a few success stories, invaluable beacons of hope such as Roadie Tuner, Anghami and Totters. But we need more and we need to support them. Also it goes without saying that our more promising and experienced talents are naturally ending up working aboard which invariably bleeds the local tech startup scene further from potentially successful new founders.
So where does this leave us ?
I listed the general challenges tech startups face around the world and added to that a comprehensive list of issues tech startups also face in Lebanon and similar countries.
It seems bleak, it is, but it doesn’t have to remain so.
Startups are already fighting the good fight, trying to create innovative solutions that could prove to be a success globally not just locally.
Against all odds, we are operating. It must be part of the human and Lebanese tenacious spirit. Also let us never forget that Silicon Valley was built on the big shoulders of humble men in their garages and basements in the 1970s. All they had was their knowledge and passion.
No one thought they could make it.
Still, we need help.
We need help from expats in the tech field to lobby for us to get us more access to western common tech company services like payment gateways and crowd funding like Kickstarter support. It’s not easy, but we need a lobby.
We need politicians in Lebanon to take a moment to actually help one of the most important sectors of Lebanon that could be key in salvaging its economy.
We also need new younger politicians who can actually see and activate the true latent potential of this sector themselves directly.
Universities have a role too in the way they prepare their students for the real life market.
Also we need better access to electricity and internet with taxation exemptions like they did in Yerevan for tech companies.
There are many shared office solution providers that rent spaces in and around Beirut, they need to reduce their monthly charge fees if they want to help the tech community.
Like I said previously we need our brain bleed to help, even if you are now abroad and reading this, help us network.
Same for local tech startups, we need to help each other to create new means of support and networking between us to share contacts, solutions and knowledge. We also need to reduce toxicity in our tech forums and hangouts.
The situation in Lebanon is dire altogether, the tech startup industry is no different, but how much we survive depends now not only on how much we keep trying but how we try and on how much support we get from the multitude of parties that can within their own means all support us in whatever we are currently lacking.
Unfortunately sometimes grandstanding between engineers in the tech field muddies the water when discussions like this get brought up. But the situation is serious, humble open discussions are more helpful these days and constructive. I always tell my team to remain cool and in control of their ego and emotions. Life is not a school’s playground, we are all adults and need a cohesive none emotional tech support community to bind us. Being patient, civil, meticulous to detail and considerate always solves team communication problems.
Finally I remind myself always that it’s important we don’t forget to give back. I know people in local tech startup scene whose valuable advice helped us so in return we always owe the community a helping hand back.