Kuwait's $200m Tech Fund a step towards embracing digital technology: Expert

KUWAIT: Kuwait Economic Society (KES) hosted a forum titled 'Tech Projects in Kuwait: Challenges and Opportunities', geared towards startups. The speakers included CEO of Faith Capital Holding Mohamad Jaafar, Founder and Managing Director of Boutiqaat Abdelwahad Al-Essa, Co-Founder and CEO of Carriage Abdullah Al-Mutawa and Executive Vice President of Research Department at Kuwait Financial Center (Al-Markaz) Mandagolator Raghu.

In his presentation 'The Future of Startups in Kuwait', Raghu elaborated on the rapid acceleration of startups in the GCC and Kuwait. Raghu said the best thing for many companies nowadays is that they no longer have to count years to soar high, as many of them are born propped up by the new era of technology, like the sudden acceleration of Apple, Google, Microsoft, Amazon and Facebook to name a few.

He said around 10 years ago, the ecosystem was far different from what it is now, as ExxonMobil was on top of the ladder, followed by companies like GE and Microsoft. He said several companies had to strive hard to reach the 50 million users threshold. "For example, aviation companies took 68 years to reach 50 million users, along with cars (62 years), telephones (50 years) and television (22 years), while Facebook and Twitter took only two to three years to achieve 50 million users. In fact, Pokemon Go reached 50 million users in just 19 days," he said. "You cannot remove technology from anything we do nowadays," he said.

Raghu mentioned several companies that are considered movers and accelerated despite being listed as startups. In Kuwait, according to Raghu, there are several companies that accelerated quickly from multiple sectors, like entertainment (Eventat), food delivery services (Talabat, Carriage, Makan, Zitaat, Jeebly), online retailers (Boutiqaat, Chip Store, Kharda) and logistics (Shipa and Armada).

"When we talk about startups, the word disruption is very important. What is disruption and what is not disruption? Disruptors like Netflix, King Price Insurance, LEDs and Skype provide services similar to existing ones, but they destroyed the old and set up new ones. Sometimes they just create and don't destroy - they just build on top of existing ones. Companies not being considered disruptors are Uber, Google and Tesla," Raghu said.

In the GCC and MENA region, he said Talabat dominates 95 percent of the market share of food delivery in Kuwait. Careem's ride-hailing network services has now present in 20 countries in the Middle East, servicing 700 million people and heading a 10-12 billion taxi market. According to Raghu, there is high-level indication that the government of Kuwait will continue to support SMEs with seed capital and can stress test the service or product ideas from its $6.5 billion national SME fund. He also mentioned the recent announcement (January 2019) of an initiative to form a $200 million fund for investments in technology as a step towards embracing digital technology.

By Ben Garcia