‘TREP TALK Jamalon, founded by Jordanian Ala Alsallal, the founder relocated to Dubai in 2016, although the startup maintains operations in Jordan (where almost 90% of his employees are based) for “keeping costs down.” However, Alsallal tells Endeavor that last year, when Jamalon set in motion its plans to scale up and introduce publish-on-demand capabilities to the Middle East, they did not find Jordan’s regulatory environment to be conducive for the new model. Similarly, Jordanbased media platform Kharabeesh is another startup whose co-founders, along with most of the executive team, relocated to Dubai this year. Speaking of the ways to address the observed trends, Endeavor Jordan’s Manna says, “Any rectification of the local entrepreneurial ecosystem requires the support, collective efforts and long-term commitment of all relevant stakeholders from the public and private sectors backed by a cohesive government strategy that develops a consistent policy framework.” For instance, inadequate sources of venture capital in Jordan results in most ventures relying on informal funding through family and friends. Even with tangible developments in this scenario in recent years, the risk appetite of the financial institutions continues to be low. Hence, Endeavor emphasizes that a long-term commitment from stakeholders, a “more holistic approach,” and public-private joint efforts is needed to reverse this trend. However, despite these dominant trends revealed by the data, it’s important to note that there is also optimism among the nation’s entrepreneurs that more success is to come. Besides success stories to inspire aspiring entrepreneurs, and a growing support system, Jordan has also had global recognition and commendations come its way recently. In a recent visit to the country, Amazon’s Jeff Bezos was heard praising the incentives offered by the Jordanian economy for ICT ventures, and the Kingdom’s investment climate in general. As an entrepreneur who had a chance to meet Bezos in this visit, CashBasha co-founder Fouad Jeryes insists that not all businesses are the same, and decisions to enter new
markets stems from the needs of each venture. “For us [CashBasha], our network, our reach, Jordan is the only place we would be able to progress with such momentum in such short time,” he adds. This optimism was uncovered in Endeavor’s survey as well, with over two-thirds of respondents who choose to keep their business in Jordan saying, “Jordan is home.” A quarter of the businesspersons also said that the low cost of human capital was among the reasons they remain in Jordan. A case in point is the startup MadfooatCom, a fintech venture behind the launch of Jordan’s electronic payment system eFAWATEER. While the fact that the company’s major client is the Central Bank of Jordan has a lot to do with the startup staying in Jordan, MadfooatCom founder and CEO Nasser Saleh says that “the high quality of financial services and technology talent,” and a “favorable ecosystem,” are reasons that keep them in the country. “Any rectification of the local entrepreneurial ecosystem requires the support, collective efforts and long-term commitment of all relevant stakeholders from the public and private sectors backed by a cohesive government strategy that develops a consistent policy framework.”
On its part, Endeavor Jordan admits that while it is understandable for founders and business development personnel to be based out of the larger markets in the region, their concern lies with the ventures (such as the 45% of the surveyed respondents) that wish to relocate their operations entirely. The organization says: “with prices rising in Jordan and the best of the country’s talent increasingly seeking jobs abroad, Jordan is fast losing what is considered its competitive advantage.” And it is to plug this leak that Endeavor Jordan wants to “act as a catalyst” for sustainable economic growth in the region, and wants to tap into its network of mentors to help create employment opportunities in the local market. Here’s wishing the organization all the best in this endeavor.
Jordanian entrepreneurs speak out on Endeavor Jordan’s business migration survey results
Nasser Saleh, founder and CEO, MadfooatCom While MadfooatCom currently has no plans to move out of Jordan, Saleh says that the startup may consider moving in the future, “if current and new investors in the company demand that we relocate to a more investment-friendly country.” He adds that the startup “might consider relocating our headquarters and keeping part of the operations in Jordan if the tax system becomes more unfair for our sector, and if the cost of quality technology resources and operations becomes higher than other countries.” Mohammed Asfour, CEO, Kharabeesh “Our business in the UAE has been growing much faster than it has in Jordan, which made the move a necessity. It has also facilitated our expansion into the Saudi market. However, the company does not plan to relocate its operations from Jordan, which will continue to serve as a support office to Dubai and the KSA.” Ala Alsallal, founder, Jamalon “Customs and taxation regulations for exports, as well as free-zone regulations, have been so behind [in Jordan, compared to] other countries in the region. Given that 95% of Jamalon’s sales are outside of Jordan, we found Dubai to be a good location for our print-on-demand, which will shape the future of the publishing industry in MENA. We would have loved to have set this up in Jordan.” Fouad Jeryes, co-founder, CashBasha “In my view, and to the most sincere of my intentions, Jordan in itself is a startup. That is its prime advantage. The dynamics of the country present a hotbed for tech startups to blossom. It’s a resourceful environment where most advice, partners, and support systems are way less than six degrees away from you. Although KSA might be the major market to serve, and the UAE allows for mature products to seek larger clients, the cost of setting up shop, recruiting talent and proving product viability in Jordan is practical and achievable. With Jordan being a “spring-board” for companies and a place where their headquarters are still based, we mustn’t forget that this part of the world is sadly fragmented, and Jordan is a small market, but companies jump to other areas to reach additional customers. It’s expansion, not desertion.”
march 2017 Entrepreneur
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