The start-up ecosystem in the MENA region is a vibrant one today, with irrepressible young entrepreneurs launching ideas that have power to transform the entire business landscape. From fintech to transport to education to ecommerce, hundreds of startups have been launched in the last few years, with some of them set to make a huge impact. In fact, a recent research by MAGNiTT revealed that the region now has over 3,000 startups. The study also revealed that as many as 404 investment deals took place in the Arab world in 2018, up 13% from 2017. Total funding was also up 31% from 2017 and the first quarter of 2019 saw $156M total investment in 93 deals, as well as the first unicorn exit in MENA region.
Going into 2020, what are the startup ideas that are likely to work? We have a few tips for those looking to enter this space.
Food & Beverage (F&B)
The Middle East, particularly the UAE, is a melting pot of cultures and cuisines. Food brings people together, creates a rapport, and unites the most diverse of demographics. Of late, countries in the region have seen a spurt in services that offer home-cooked meals and food deliveries. This trend is likely to continue well into the future, considering that lifestyles are becoming more hectic and many people find it difficult to cook food everyday from scratch.
The region is a global tourist hub attracting visitors from all over the world. Government-level policies to boost tourism have worked wonders and according to a report by Global Media Insight, Dubai Airport alone welcomed as many as 89.1 million travelers in 2018 and the first half of 2019 saw over 41 million visitors. Capitalizing on this fact, any startup dealing with tourists and visitors are bound to resonate well with the public.
The UAE, particularly Dubai, is the home of style, fashion and accessories. Any business that innovates in this area can be sure of instant success. A unique fashion brand of your own is not as difficult as you think. All it takes is imagination, skill and knowing what the people want.
Let’s face it, e-commerce is huge in the region. A report by Mena Bytes titled ‘E-commerce in MENA: Opportunity beyond the hype’ states that the e-commerce market in the MENA region stands at $8.3 billion and could grow by 3.5 times to reach a total market size of $28.5 billion by 2022. However, studies also show that most of the online goods purchased in the region are shipped from overseas locations, so the potential for local, homegrown E-commerce companies are huge.
Health and wellness
This is one area that never goes out of trend. Health and wellness has caught on in the region in a big way and people of all ages are keen on looking and feeling good. A cozy yoga studio, or an obesity counseling and nutrition centre would all do very well in the region irrespective of competition.
Digital technology services
The demand for customized digital services is strong and ever growing in the region. Dropping smartphone prices and explosion in YouTube usage coupled with super fast Wi-Fi speeds, has led to an awareness of the need for a strong digital presence. According to a report by Global Media Insight, a significant 99.06% of the UAE population remain active on social media. This means that in 2019, a massive 9.52 million people came online on social media almost every day out of a population of 9.61 million people. In 2019, the country saw a 1.1% annual growth in mobile social users as well. Need we say more?