The Untold Story in the Middle East

by tuftsigl
Nov 11

Written by Jeremy Zelinger, former IGL student and current teammember

 

Headlines from the Middle East tell familiar stories of seemingly intractable sectarian conflict and political turmoil. But two EPIIC colloquium speakers recently described the region in entirely different terms. There is a second revolution now in its infancy, they claimed, and it focuses not on religion, sect, or politics but on shared prosperity. This wave of entrepreneurship stands to transform the Middle East.  And the United States should alter its approach to the region accordingly, they said.

 

Steven Koltai and Chris Schroeder, both successful entrepreneurs who in recent years have focused on the Middle East, lectured to the EPIIC colloquium in October. Schroeder, who started several Internet companies and authored Startup Rising: The Entrepreneurial Revolution Remaking the Middle East, described the massive economic potential of the region.

 

“The Arab World is also a market. We’re talking about 350,000 million people with a bigger GDP than India and a bigger per capita GDP than China. And so there are amazing things that are happening from a growth perspective.”

 

Given the market opportunity, young Arab entrepreneurs are importing Western business ideas and applying them successfully to their societies. Maktoob, founded in 2000, was one of the first all Arabic Internet portals in the Middle East. In 2008, Yahoo! acquired it for $175 million.  Similarly, Souq.com is an e-commerce business in the tradition of Amazon and Ebay, but designed specifically for Arab consumers. Schroeder described how these success stories are changing attitudes in the Middle East, as older generations begin to support the entrepreneurial ambitions of their sons and daughters.

 

“Now young people are saying, ‘look at Maktoob or Souq.com or fifty other companies’ and that allows for a kind of credibility for the choices they are able to make,” Schroeder said.  

 

The new openness has created a generation of entrepreneurs who tackle problems once considered too difficult to fix. Schroeder provided the example of crowded highways in Cairo, which desperately need to be redesigned. Whereas an older generation would have waited for the government to improve the dilapidate infrastructure, several Egyptian start-ups have released crowd-sharing apps so that drivers can communicate to avoid traffic.

 

“People by the hundreds of thousands are using technology to create their own jobs” Schroeder said.

 

Koltai, who created and directed the Global Entrepreneurship Program under Secretary of State Hillary Clinton and now heads Koltai & Company, a consulting firm whose motto is “World Peace Through Entrepreneurship,” shared his experience trying to insert entrepreneurship promotion into United States foreign policy. Despite amazing opportunities, Koltai said, the United States is failing to keep its promises and pledges to the entrepreneurs of the Middle East.

 

From his time at the State Department, Koltai learned that officials tend to over promise and under deliver. The US government and other institutions have pledged billions of dollars to various programs in the Middle East, but very little, if any, of that money has actually been invested, he lamented.

 

Schroeder expressed similar sentiments about the lack of American support for Middle East entrepreneurship.  “It never ceases to amaze me the number of American investors I know and the number of American government people I know who want to talk about one narrative of the Middle East.”

 

“Its not that I’m making an argument that this hopeful scenario [of entrepreneurship] is more true than things that are difficult…but it is a scenario that we don’t think about a lot and its ramifications are completely unprecedented,” he said.  

 

Political instability and internecine conflict have taken center stage in the Middle East. But behind the curtain, out of the audience’s view, there exists a revolution of entrepreneurship that, according to Schroeder and Koltai, may eventually steal the show. 

 

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