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Sun 9 Nov 2014 03:39 PM

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Get in the Ring for investment opportunity

The UAE’s frst ‘Get in the Ring’ competition has put Dubai’s start-up ecosystem in the international spotlight again. Tamara Pupic reports from the event held at in5 and meets some of the participants

Get in the Ring for investment opportunity

Starting a business can be hard. It can make you feel like you are in an everyday battle facing off against other start-ups or larger companies. Like you are in the ring, going 12 rounds with your competitors.

But there is one particular ring into which most start-up founders would like to climb, since it might secure them an investment of $1.25 million.

The competition is Get in the Ring: The Investment Battle, an initiative of the Erasmus Centre for Entrepreneurship from the Erasmus University Rotterdam, which has now launched in the UAE.

Founded in 1913 by three Rotterdam entrepreneurs, the Erasmus University Rotterdam brings business and academia together to address many facets of entrepreneurship and empower entrepreneurs to create added value.

One of their initiatives, the global Get in the Ring (GITR) competition, comprises three rounds, with the first two competition  – local (held in over 50 countries) and regional (held in eight regions) –  taking place between June and November every year.

The competing entrepreneurs aim to get to the last round and pitch at the international final which is organised during Global Entrepreneurship Week in The Netherlands on 21 November each year.

Since 2009 over 3,000 start-ups have participated in GITR, resulting in over $7.5 million in investments. In 2013 alone the battle included over 1,000 start-ups from 32 countries and more than 300 investors were involved in the process.

Among the chosen eight to battle in this year’s grand final will be the winner of the first ever regional final of Get in the Ring: Middle East, STC Challenge, to be held in November in Riyadh, Saudi Arabia.

The regional champion will receive $5,000 to cover an all-expenses paid trip to Rotterdam, having beaten seven rivals from other Middle East countries.

One of these eight regional finalists is the competition’s first ever UAE national champion, pixelbug - a Dubai-based marketing technology start-up that helps businesses adapt new technologies to drive engagement with their stakeholders.

Dany El Eid and Elie Youssef, co-founders of pixelbug, took part in a day of intense pitching between 10 start-ups. The companies had been shortlisted by Afkar.me, Intigral’s product incubator, and in5 innovation hub, which teamed up to bring the competition to the UAE.

The judging panel decided that pixelbug’s latest augmented reality ‘edutainment’ app, colorbug, which targets kids aged three and above to improve how they interact with storytelling and colouring books, fulfills the competition’s criteria of being a scalable and innovative business idea. 

“For the first UAE Get in the Ring the quality of entries was very strong,” said Juan Jose De La Torre, founder of Afkar.me, and one of the panelists.

“I congratulate pixelbug, whose concept is innovative and creative, and who are changing the face of marketing in the UAE.”

Talking to StartUp on the sidelines of the event, another panelist, Prashant K. Gulati, president of the Dubai chapter of The Indus Entrepreneurs (TiE) and founding partner of The Smart Start Fund, explained how start-ups should approach these kinds of competitions.

“We look for innovation that could be done all over the world,” he said.

“You cannot change your model because of the competition but you can probably change your spin, what you actually pitch for. You have to have a pitch: ‘It’s not what we do but the way we do it.’

“So their selling point is not business but the packaging; that they can walk into a new city and launch it in a month.”

Gulati is also a member of the TiE Global Board of Trustees, an organisation founded in 1992 in Silicon Valley by a group of successful entrepreneurs with roots in the Indus region to foster entrepreneurship globally through mentoring, networking, and education.

One of the other competitors, Ehteshamuddin PA, founder of JunkBox, which aims to provide fun access to science, technology, engineering and mathematical (STEM) education, said that pitching to judging panels provides them with interesting new perspectives on their business.

Junkbot is a kit that enables users to build robots using junk, such as water bottles, cds, and cardboard, creating an affordable, fun and environmentally conscious way to teach STEM concepts and creative thinking.

Since launching in May this year, the four founders of JunkBox have achieved several milestones such as incubation within TURN8 Accelerator Programme, advanced phase of negotiations with the UAE’s Ministry of Education to run a pilot test with schools in Dubai, and the opportunity to pitch at The Slush Conference Startup Competition 2014 in Finland.

The founders of another start-up that took part in the competition, mrUsta, have been developing their business model in line with Gulati’s advice from the very beginning, and less than a year since the launch in Dubai they have already set their eyes on the market in Saudi Arabia.

Together with her husband and two partners, Dunia Othman, co-founder and chief marketing officer at mrUsta, has developed an online business directory of local service providers which also offers a service rating system accessible through mobile devices and PCs.

“The website went live in the beginning of this year. We collected over 2,000 service providers [in Dubai] for the launch already,” said Othman.

“The Middle East, the Gulf specifically, is highly based on little mum and dad shops that have been there for a while versus the big corporates. And these are the ones people trust more because the quality is really good and the price difference is significant.”

The community-oriented feature of the Arab world allows them to implement their model in other regional countries, firstly in Saudi Arabia.

“We believe that the need will be bigger than the obstacles we will encounter. It’s a way to improve a country’s quality of service providers as well as help people get a good service,” Othman continued.

“But you can’t do it without local guys. So the intention is to set up an office there [in Saudi Arabia] and hire people who know [the market’s] ins and outs.”

The four partners initially set up the company at Creative Free Zone in Fujairah but was then incubated at in5, which they consider the right environment for their business.

Othman added: “The actual set up paperwork is not hard but figuring out where to do it is difficult. It’s always confusing because you need to have a good address on the business card, and you want to have other start-ups and mentors around you.

“The whole perception that you need to start making money from day one doesn’t really work for an internet company. So you need to be around people that can understand that, which is where we struggled – to find the right environment.

“Dubai is all about who you know. A lot of people are always hesitant to introduce you to others but in order for the UAE community to have more start-ups we need to be more comfortable with expanding our networks.”

Also discussing the UAE’s current start-up environment, Gulati said the ecosystem was still nascent, but growing.

“You do see a lot of excitement but the whole ecosystem is not ready,” he said.

“I think that comparisons with other ecosystems around the world are unfair because we don’t have all the pieces. So we still need to do a lot of work.

“The biggest problem that I see is that experimentation is too costly. There is no differentiation between a start-up and any other company. You have to understand and differentiate that the risk for a start-up is far higher than for a trading company [for example].

“We all talk about start-ups but very few people understand that we should allow people to experiment, fail quickly, and go on, not making it very costly for them to do that.

“Because if you don’t do that, people stop taking risks, and when they stop taking risks, they stop doing innovative things. So I think that mindset change is required.

“The other thing that is extremely important to note is that there’s very little or no money at the bottom of the pyramid. Nobody invests in experimentation.”

In his opinion, the lack of finance provided to start-ups in the beginning has an impact on the decision to embark on an entrepreneurial path at all.

He added: “Most of the people who are entrepreneurs here are usually corporate executives or employees who saved money, thought of an idea or saw an opportunity, went on their own and did it.”

Othman explained that this was how she and her partners had set up mrUsta, combining their own expertise in engineering, marketing, and financial and legal matters. However, Ibrahim Colak, founder and CEO, eventually decided to quit his day job and commit to their start-up full time.

Othman said: “If you’re expecting people to be 100 percent behind you than you need to be 100 percent in it. You can’t do it without someone dedicated. I don’t think it would be possible.”

After a display of positivity and confidence in the presentation room, as well as congratulating the winner, Othman gave a few pieces of advice to other tech-entrepreneur wannabes:

“I would advise networking in the start-up space initially, figuring out how other start-ups have done it would be very useful,” she said.

“If your business has a database and marketplace for information, build the business first and then go to consumers because it’s a secondary thing.

“The next advice is start free and get people used to your site. Think long term always when you’re doing a business because if you’re thinking short-term it will go quicker than you think.”

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