A first-hand perspective on Corp-up in the Middle East.
Corp-up collaborations in the Middle East, which were also the subject of a recent joint webinar between Match-Maker Ventures and Arthur D. Little, have been steadily growing in popularity and impact, demonstrating the potential power of scaleup-corporate collaboration.
Match-Maker Ventures (MMV) has recently expanded its growing global operations to the Middle East, a region which has become a leader on innovation in recent years. As a part of the company’s engagement with the region, MMV has appointed Hany Aly as Middle East Venture Partner, where he leverages his years of experience in the telecom industry and his regional expertise to facilitate the development of successful corp-up collaborations.
To share leading insights on these collaborations and their relevance for the Middle East, we sat down with Hany to ask him for his perspective on the latest regional trends, the value of scaleup collaborations, and more.
Why is Corp-up so relevant these days?
We are living in the fourth industrial revolution.
Innovation is cutting across industries, and it is not linear. What’s more, it is happening at an exponential rate.
This is why many leaders of corporations feel that the world is moving faster than they are. We are living in an era of mass disruption in which the future is becoming less and less predictable and corporates are really starting to struggle to keep up with the changes that are going on around them. Everyone feels that the world is moving faster than they are.
It is very difficult for corporates, which are designed to provide products and services on a mass scale, to keep up with these changes in-house. The solution is to virtually insource some of the innovation from smaller entities who are designed to innovate.
These are what we call “scaleups:” mature startups that have a proven business model and that have enough financing to grow. The corp-up model combines the power of corporates with the power of scaleups to unleash innovation on a global scale. Corporate + Scaleup = Corp-up.
Why is the Middle East such an attractive place for Corp-up?
Among other key drivers of innovation, we need to consider the focus industries that are being targeted in the region. The Middle East as a whole, and especially the gulf countries, are embarking on a massive program to diversify away from oil revenues. Corporates based in the Middle East are hungry for innovation to deliver on this agenda.
Moreover, the region boasts a growing tech-savvy and young population with significant disposable income. These youths are shaping up to be a key consumer group for the newest solutions on the market, accelerating tech adoption and setting the region apart when it comes to the capacity to absorb innovation. Put simply, the Middle East is one of the best markets in the world to launch something new, and corporates have a great opportunity to deliver to this innovation-hungry consumer base through corp-up.
What roadblocks remain for Corp-up collaborations in the Middle East to thrive?
Even though the region is a leader on innovation, there are still a few roadblocks for the corp-up model in the Middle East.
Companies here are cautious and usually start the corp-up model in the form of strategic partnerships like simple commercial agreements, with the later possibility of maturing to JVs or equity investments. Potential collaborators should avoid being overly hesitant or risk-averse when it comes to these collaborations – when partners are committed to achieving impact together, the benefits of corp-up outweigh the risks.
In addition, corporates in the Middle East place a strong emphasis on data privacy. In order to have success in the region, scaleups must be ready to have in-country deployment of their technology to comply with local privacy and data protection laws.
In which industries would Corp-up collaborations thrive in the Middle East today?
Any industry could benefit from the use of corp-up collaborations to achieve innovation. However, there are a few industries where I currently see particularly strong opportunities for success. In the telecom, banking, and insurance industries, there has been a lot of recent disruption from smaller players who are looking to access large markets and fuel their growth. Because of the pressure to withstand these disruptions and get ahead of them, these industries are especially well-suited for corp-up.
To learn more about corp-up collaborations in the Middle East, read our event summary from our recent joint webinar with Arthur D. Little on the subject. For details on previous successful collaborations involving MMV portfolio scaleups, check out our success stories here.