An entrepreneur is a person who makes an organization for commercial purpose and entrepreneur must be energetic. Moreover, entrepreneurship is the method of designing, running and launching a new business that is often in initial stage a small business. Moreover, entrepreneurs must have the willingness to organise and develop a business venture in order to make a profit. However, not all business start-up can see the light of success, in many cases, lack of funding, economic crisis and lack of market demand can create issues for the entrepreneurs. Entrepreneurs find opportunity in the market and from these opportunities; they develop new services or products. In recent time, most of the entrepreneurs start the business using online platform. In this regard, entrepreneurs must have the desire for independence autonomy and they should have a desire for responsibility. Entrepreneurs should take the risk and they must be organised in capacity. However, the entrepreneurs face issues in opening the start-up in many occurrences. There are some of the entities that provide help to flourish the start-up business as well.
In this study, Flat6Labs organisation has been chosen that operates in Abu Dhabi and it is a start-up accelerator. In the later section of the study, the steps to open a new business have been discussed in this study. However, there are other entries there which provide help to start-ups in Europe and Silicon Valley as well. There are some basic differences in providing help to the start-ups in Silicon Valley, Europe and UAE. In this study, the differences as also been discussed. A successful start-up Jumpsuite has been chosen to discuss its success story as well.
Flat6Labs is a startup accelerator programme that helps the young entrepreneurs to foster in their startup business. Moreover, Falt6Labs fosters the innovation with cutting-edge ideas. In addition, Flat6Labs provides investment to the startup so that the entrepreneurs can grow in business. Flat6Labs gives seed funding, creative workforce, strategic mentorship, entrepreneurs focused training and multitude perks. Moreover, Flat6Labs assists the entrepreneurs to make an expensive network of various partners that can invest and mentor the business to grow (Flat6labs.com 2017). This entity creates an environment to the startup to flourish the small business in the very short time frame. In addition, Flat6Labs provides 24-hr office space and it assists the entrepreneurs to keep in touch with the mentors with well-established advisors. The entrepreneurs can get the best business plan as well as execution strategy of the business plan. Flat6Labs has partnerships with many famous and foreign companies like Sawari, Microsoft, GAN, PWC, Qualcomm and TechSparks and these organisations help the entrepreneurs in getting the ideas and investments (Flat6labs.com 2017).
Apply
In order to join Flat6Labs, the entrepreneurs have to apply online and the employees have to go through multiple screening processes in order to get selected. Flat6Labs screens all the candidates and best entrepreneurs get selected for the programmes.
Grow
This is a programme course and by the end of the programme, this entity asks the entrepreneurs to pitch the business plan to the investors’ community at Demo Day. The Flat6Labs rises funding for the entrepreneurs so that the entrepreneurs can get the opportunity to grow the business easily (Flat6labs.com 2017). After the Demo Day, the entrepreneurs may leave the Flat6Labs; however, they can get connected with Flat6Labs. However, Flat6Labs provides always support and connection to the entrepreneurs.
Accelerate
Once Flat6Labs accept the entrepreneurs, they become part of Flat6Labs family. Flat6Labs guarantees that within four months, the business can flourish under the umbrella of them. This entity provides seed funding and it gives start-up workshops with educational programmes. It provides office space and seed funding for the entrepreneurs.
The flat6labs entity has its offices in 5 locations and it has more than 200 mentors who provide help to the entrepreneurs. At present, the organisation has more than 220 entrepreneurs under them and it has support from more than 100 companies. Flat6Labs provides almost 50% of the funding in the opening of the start-up and it has created more than 700 startups initiatives. Apart from the UAE, it has its offices in Cairo also. Moreover, it offers various services to the entrepreneurs.
Flat6Labs provide training to the entrepreneurs in order to make them experienced in the field of business. This entity provides help to the entrepreneurs in academic training, partners training, industry experts training and boot camp. It provides up-to-date focused in training sessions from many of the industry experts as it has a connection with the many famous organisations around the world. Many of the corporate leaders provide helps in flourishing the business in the Middle East countries. Flat6Labs has resources and tools for giving training to the entrepreneurs in such competitive global market.
It is not easy to open a business and the business will be successful in no time. The entrepreneurs try to plug into a community where they can access the contacts of the various network (Drucker 2014). Flat6Labs provides help to the entrepreneurs who can take help from partners, investors, customers, developers and mentors that are associated with the entity. Flat6Labs is growing in the market and they are the ever-expanding network. This entity has a relationship with international and local industry experts, managing directors, innovators, media and CEOs. It provides web support to the entrepreneurs to teach them about various marketing tools. Most importantly, Flat6Labs can be a well-mentioned brand name when the business will grow up. The networking and exposure of entrepreneurs will be startup events, media & PR coverage, demo day and business networking.
Flat6Labs provides help to the entrepreneurs in providing added values of perks and services. Flat6Labs provides the startup with the benefit of $300k in perks and benefits that can provide entrepreneurs with best resources. This resource helps the start-ups to flourish and build in the market. It provides benefits to be part of Global Accelerator Network that helps to make various partners in the industry. This partnership can provide help in taking the advantage to get huge perks from the sponsors like PayPal, Microsoft and Amazon Web Services. The perks and services are related to the Softlayer, Bayt.com, Eleance Oedsk, MailChimp and Rackspace (Flat6labs.com 2017).
Flat6Labs provides entrepreneurs with up-to-date focused legal support in free of cost in the opening of new business. Moreover, in Abu Dhabi and in Cairo, the legal system of the marketing and opening of business, the entrepreneurs can take help from Flat6Labs. In getting the legal support and advice can be expensive for the entrepreneurs in the opening of start-ups (Kirzner 2015). Flat6Labs has a team of lawyers who provide help to the start-ups in any query that they have in relation to business and licensing. Legal consultation, service and support are needed in starting a business as these are related to the company establishment, agreements, legal contracts and IP (Intellectual Property). In registering the company through following the government rule, this entity provides support to the entrepreneurs.
This entity provides four months support to the entrepreneurs as mentors and they claim that these four months are better than one year struggling by them alone. Flat6Labs links strategically the entrepreneurs’ goals with providing help in making a business plan, arranging funding, logistic supports, hiring employees, solving technical issues, attracting customers and presenting the entrepreneurs in front of investors. In facing the critical decision, each of the entrepreneurs needs to solve the dilemma. In this regard, the startups can get guidance in various aspects from this entity. In the first occurrence, all the entrepreneurs make some mistakes; however, in improving the learning curve in the process of business, Flat6Labs can help the entrepreneurs. The features of mentorship are related to the coaching, weekly dinner and one-on-one meeting with mentors who can share the knowledge of the business and the entrepreneurs can experience bluntly and honestly the information of startups (Baum et al. 2014).
Entrepreneurial process is related to the recognising and refining of a viable economic opportunity in the marker.
Getting the primary idea about the market can help in starting the startups and the idea is related to the simple conception of opportunities and obstacles in business. The ideas of opening business can be various, however, the entrepreneurs need to find the market opportunity, building a successful business and implementing the ideas in the business process. As stated by Storey (2016), market opportunity can be defined as gap left in the industry that can give chance to entrepreneurs to penetrate the market with new ideas. The ideas must be related to the disruptive innovation and that can open up the prospect of the business.
Entrepreneur alertness is the ability to see the vacuum in the market and exploit the opportunities in the market (Nandan 2013). This alertness can create the opportunity in the market to recognise and capture the market value. The entrepreneurs need to scan the market opportunity that would provide the changing information of external environment.
Timely adaptation of the opportunity is needed if the entrepreneurs find the market suit to his/her services or products. Opportunity development can be defined as the method of combining resources with the systematic approach of promising potential opportunity.
Opportunity evaluation is the critical stage that affirms that the entrepreneurs can execute the business process with investment and risks to be taken. Opportunity evaluation process can be undertaken with various factors, market opportunity, products and services, costing and pricing, profitability, capital requirements and issues and risks (Karimi et al. 2016).
The entrepreneurs find the ‘free zones’ in the market and then select the type of business they want. Moreover, the entrepreneurs can start the business online or they can just start the business that has proximity to the urban places. In the preparation process, the final activities must be done.
After selecting the names of the business, the entrepreneurs need to confirm the names from the government. The paperwork needs to be done through online as the entrepreneurs are required to complete an application for the chosen company activities along with the copies of the stakeholders. The startups must have a Non-Objection-Certificate from the authority and the startups need to have a letter from current sponsors. In addition, in Dubai, getting the license for the organisation is an easy way as the entrepreneurs’ just need to apply the process (Covin and Miller 2014).
Pitching
There is no definitive framework that can help a startup to raise money in business and there are various tactics that framework use to gather in starting of business. There are some of the quantitative and qualitative factors that help an organisation to take the funding decision. The pitching of the business should be perfect in a finding of the capital of the business. However, the startup pitch can hold in any place, formally or informally. Great way to start a business is to establish a relationship to the capital investor. A friend referral or any entity can provide help in gaining the funds; however, business models in the earlier stage of the business do not matter. In earlier stage startups, meaningful metrics should be taken in order to understand the business requirements. Existing customers in the market should be judged before startups take the momentum. As stated by Brain (2013), most important part of the pitching is the ‘why’ as the entrepreneurs should know why they are starting the venture with risks. Every startup has a story and motivation to start a business. Moreover, the entrepreneurs must have a clear idea why they want to start the business ‘now’ as the idea of the business should be powerful that can fulfil the gap in the market.
In UAE, the entrepreneurs can get help in wring the business plan as the entrepreneurs have an idea of the business; however, they do not have an idea how to start a business. The entity like Flat6Labs provides help in starting the business with a business plan. In starting the business, the mentors are needed in order to make understand them the idea of new business. A new business plan should start with the idea of market and Flat6Labs helps the organisation to start the business with correct planning. The entity like Flat6Labs helps the entrepreneurs to research the market with competitive analysis. In this stage, the most important part of business planning is the calculating the startup costs and find a fund for the business. Moreover, the startup business can buy new franchisee as well in order to penetrate the market (Boseli 2016). Business planning is related to the marketing mix when the startups can take promotional activities in order to sustain in the market. Moreover, the business planning must be inspirational and achievable so that the business startup can gain this with actual planning.
The Corporation Council for the Arab States of the Gulf originally known as Gulf Corporation Council is a regional intergovernmental economic and political union that comprises of all Arab States of Persian Gulf. GCC is a trade bloc and it helps the business to flourish in UAE. The common goal of the GCC is to have a customs union and common market for the business. The main objective of the GCC is to start common currency. GCC helps the business to formulate the finance, trade and legislation system that can establish the scientific research centre (Sharpe and Schroeder 2016). Moreover, the GCC helps the private sector to operate in cooperative mode. In UAE, the entrepreneurs can access the investors for the funding of the business and it helps the businesses to strengthen ties between the people. This entity segregates the markets into five different categories, in Market 1, it invests $100,000 to $1 million and in case of Market 2, it invests of $1 million to $10 million. Moreover, in market 3, it invests $10 million plus amounts. Some of the assets that can be invested in GCC activities are bonds, property, carbon credits, businesses, diamonds and art, silver and gold. This GCC entity helps the UAE entrepreneurs to grow in the market. Moreover, the entity like Flat6Labs arranges the meetings to the GCC to entrepreneurs.
Office space is needed in starting of the business and the entity Flat6Labs helps the entrepreneurs to have state-of-the-art space and the entrepreneurs can start the business in a similar stage. Flat6Labs provides help in co-working hubs and it has flexible space designed that facilitates the productivity and interaction (Ismail and Yehia 2016). Physical space is provided by the entity like Flat6labs and working at the office can provide help in growing the network in entrepreneur field.
In opening a startup, the entrepreneurs need to select the funding model. The entrepreneurs can opt to a bank loan or they can find the angel investors who can help the business is flourishing. The entity like Flat6Labs helps the entrepreneurs in the opening of business through funding, the entity invests $10k to $15k as seed funding in exchange for small equity in the business. As stated by Acs (2016), this seed funding helps an entrepreneur to cover up some of the expenses in an early stage that the business has to go through. The entrepreneurs need to define the programme with core application and it is commercialised attempt of the organisation to develop the services and products. There are two types of funding, seed funding and follow-on funding. The seed funding serves as a critical catalyst to achieve the specific milestone of the business.
Entrepreneurs and job creation
The Middle East is one of those regions in the world that has a large population of the young generation. Approximately more than half of the population is young workforce. Such a large population of younger generation carries both opportunities and challenges with it. However, this all depends on the opportunities that are there in their respective regions. If they have sufficient job opportunities in their region they will certainly deliver their best to their home country. Consequently, the home country will be benefitted from the flooding of talented professionals. On the other hand, if the respective region does not have sufficient opportunity to such a large population, the society will not perish. The society will certainly struggle to retain the young talent. Moreover, they will leave with one option to move to foreign locations where they can get maximize opportunities. Such movement will serve the purpose of the younger population but this will not serve the purpose of the concerned region (Hoffman and Jamal 2012).
The Middle East countries are way behind in providing opportunities to the young population than any other countries. According to the World Economic Forum, the Middle East region needs to create 75 million jobs by 2020 in order to stay as per the standard opportunity rate. This further means a high jump of 40% than what exists. Keeping the scenario in mind, the region has started to feel the requirement to have an entrepreneurial environment. Such environment does not only provide an employment opportunity to the owners but it also provides a way for the others. The success of such a start-up business will definitely influence the local economy, which is good for both the company and the country it represents. The benefits do not end here, this will rather provide ample of the job to others who will support the newly formed entrepreneur. The innovation that the entrepreneur uses will benefit the purpose and also the work environment in the country. This is indeed a potential strategy as this will supply the required number of employability to those who are left with no option in the country (Ncube, Anyanwu and Hausken 2014).
This study is also focused on one of such stories. Flat6Labs is one of such entities operating in the United Arab Emirates, which has become responsible for much entrepreneurial business startup. The entrepreneurial activity in this region seems robust. This is worth mentioning that approximately around 13% of the working population is engaged in entrepreneurial activity. The figure is astonishing. This is even far bigger than in US, Germany and Japan (Schroeder 2013). However, despite all the opportunities, there are ample numbers of such entrepreneurs who start up the business to satisfy their needs. They are less innovative and are loosely connected to the betterment of the nation they represent. It is very difficult to resolve the issue of employment in such cases. There is a need to have leaders who can identify the potential entrepreneurs that have thirst in them to innovate. If this happens this will produce a flood of job opportunities to the citizens (Nuwait 2017).
Currently, there are many entities operating in the Middle East region. Flat6Labs is one of those names that are based in the United Arab Emirates. It also operates in some other parts such as the Kingdom of Saudi Arabia. However, an increasing number of such entities do not make much difference. Indeed, their effectiveness matters the most. The purpose is to serve the needs of innovative entrepreneurs who are hidden and needs opportunities to explore their credentials to the world of business. The Entrepreneurial Ecosystem has four elements, which will be required for supporting a startup business to an entrepreneur. Following is the list of four elements (Naqvi 2012):
It is obvious from the current state in the Middle East countries; the entrepreneurial ecosystem is missing on the regulatory framework and equity investors.
There are huge differences in between the entrepreneurial ecosystem of the Middle East countries and the Silicon Valley. Silicon Valley is supported by giant investors who accelerate the startup business. There is no match between the numbers of a startup business, which is supported by the entrepreneurial ecosystem. The Middle East countries are nowhere near to the number. Additionally, the Silicon Valley has already witnessed giant startup business turning into the multibillion-dollar company. Some of such names are IBM, Sun, HP and Oracle (Kushida 2015). These are not the only names. The giants are further producing giant entrepreneurs, which still does not exist in the United Arab Emirates. On contrary to this, the United Arab Emirates have large numbers of such entrepreneurs who are living their own needs and demands. They do not have any such innovative thoughts. The Middle East countries do not have a single success story like such. However, competition is really high in the Silicon Valley. It is indeed much difficult to succeed with the startup business in the Silicon Valley. On the other hand, this is relatively easier to succeed with the startup business in the Middle East countries. It is further relatively easier to impress the investors in the Gulf countries (Zengyu Huang et al. 2013).
The surrounding atmosphere is very competitive in the Silicon Valley. People working in Whatsapp, Facebook, Uber and Google can be easily found even in the restaurant. However, this is hardly possible in the Gulf countries. Dignity is respected in gulf countries, not the innovation. The thirst for success is also very less in the Middle East countries. People coming from Google will be warmly welcomed in that region. However, they should rather feel pride on their natural and financial resources. It is very ironic that Silicon Valley where finding a talent is way much harder than it is in the Middle East countries, it is still way ahead of the region in terms of accelerating the startup businesses. Retention is way tougher in the Silicon Valley. It is not only hard but very expensive as well. Employees working there frequently shift from one company to another as they have many options to switch over. Despite all these odd situations, the Silicon Valley is still a way ahead to the GCC (Auerswald 2014).
The Venture Capital funds (VCs) is very powerful in the Silicon Valley. There are thousands of investors in the area but it is relatively harder to get the investments done. Ne needs to be really creative and goal oriented in order to get the investment supports from such venture capital. It is not that easy to start up a business by just starting up a business. It rather requires sheer innovation, which will excite the investors. On contrary to this, numbers of such entrepreneurs are much in the Middle East countries who start up a business for their personal need only. They do not have in them the zeal to move ahead and use an utmost innovation to flourish the business. Moreover, they are in very limiting numbers who are actually supporting living up to the expectations and opening up ways to others. The Middle East countries have comparatively a better condition than the Silicon Valley. Investors can be easily found in the region. However, entrepreneurs in this region are missing on innovation and the zeal to progress ahead (Acs, Szerb and Autio 2016).
The above discussions have provided many important points, which can describe the differences in between the entrepreneurial ecosystem of the Silicon Valley and the Middle East countries. Following are some notable differences in the Silicon Valley and the Middle East countries (Kumar 2013):
Flat6Labs is one of such names in the United Arab Emirates, which has really been benefitted from the entrepreneurial ecosystem. The entity has shown utmost innovation, which is required to prosper the local economy of the United Arab Emirates and to provide ample of opportunities to the talented professionals in the country. The entity has been responsible to accelerate the startup business of many entrepreneurs (Flat6labs.com 2017). One of such names is Jumpsuite. This is an online business that provides a platform to others where they can actually create, market, sell and train the nutrition plans. The platform has aimed at attaining a stage where global clients will be able to browse and purchase the program. Sellers can also use this platform to produce their products in a more effective way. Moreover, the startup business has worked as it has become a solution to many in the United Arab Emirates. People from the different parts of the world can also take the benefits of the platform. Following are some of its objectives (Jumpsuite.net 2017):
The platform has so far 5012 registered user on to its credit. It has so far successfully sold 1496 programs. It has been held responsible for burning 3001000 KCALS/DAY. It has already provided 126020 hours of exercise (Jumpsuite.net 2017).
From just nothing to such a significant position, the platform has shown its potential. It has really been benefitted from the entrepreneurial ecosystem that exists in the United Arab Emirates. The Flat6Labs has really done wonders for the country as it has helped entrepreneurs like Jumpsuite to flourish (Flat6labs.com 2017).
Explaining the success story
The success story can relay be understood from a fact that there are very fewer numbers of entrepreneurs in the Middle East countries, especially in the United Arab Emirates. Jumpsuite has moved against every odd. In the United Arab Emirates, many entrepreneurs prefer keeping them confined to their business only (Jumpsuite.com 2017). They took the help to benefit their own needs only. They were less innovative, which is why there is a huge difference in the success rate of entrepreneurs becoming a global success as it happens in the Silicon Valley. Silicon Valley has the examples of Google, Sun, Oracle and HP to its credit (Blomberg 2012). There is no such name in the United Arab Emirates. It is neither in the entire Middle East countries. Flat6Labs is a success; however, it is not up to the standard of Google and so on. Despite the fact it is a happy note to the United Arab Emirates as it has now started to enter the innovation zone. The zone will produce many such entrepreneurs in the nearing future like the Flat6Labs in the United Arab Emirates (Jucevicius et al. 2016).
Another challenging condition in the United Arab Emirates is the legal framework, which has encouraged the investors to invest in many such projects that were not innovative. Consequently, the numbers of such entrepreneurs are much in the country that has just initiated the startup business to satisfy their personal need. The investments made on such entrepreneurs did not help in flourish the employability condition in the country. On contrary to this, the legal framework is much strict in the Silicon Valley. It is comparatively very challenging to satisfy the investors. Investors want a really innovative concept before they make any investment. Such a strict framework is one of the causes behind the success of entrepreneurial ecosystem in the Silicon Valley (Pierrakis and Saridakis 2017).
Collectionair is a platform for the lovers of art and collectors can sell and buy their products as well. It is a website based startup that works mainly Middle Eastern and African countries and it allows the users to borrow and swap the art markets. This plat offers the users to find the quality art products those are hard to find in the open market. This startup check the authenticity of the arts and the users can access both pre-loved and new artworks here. Collectionair startup also does the valuation of artworks, insurance, condition reports and shipping as well. This startup recruits a team of curator that goes various places to find the artworks for the users and the teams go to the preferred destinations to search the artworks. The main focus of the organisation is to find the emerging art markets and merging arts as well. This startup understands the market gap and the market demands an app or website where artworks can be sold and bought. The startup gives access to the artworks pricing between $500 and $50,000. This startup never compromises with quality of the art. Moreover, the art website provides the art news, art tips and artists news as well. The startup is going to make a connection between B2B and C2C marketplaces that can allow the users to sell and buy the products and also borrow and swap the products. The site of the startup is now Beta and it was launched in this year at the end of March and selling function of the artworks started at the end of the June (Collectionair.com 2017). This startup believes in content marketing and it launched blog pages later in April of 2017. Users can log in the pages and discover the online exhibition available on the pages. It has already gathered more than 4000 users and users can find the arts with prices marking with these.
It is very much evident from the above-mentioned fact that Collectionair has succeeded after being trusted by the Flat6Labs. However, the success is not in the line of giants like Google but still, it can be concluded that the scenario is changing for the United Arab Emirates. There are now few other entities like Flat6Labs who are accelerating the startup business to many. The picture can be much brighter if the Middle East countries come up with a robust legal framework (Ding 2015).
Conclusion
An entrepreneurial ecosystem is much in practice in the Middle East countries because the region has comparatively lesser opportunities to the young population. To serve the purpose of feeding them with sufficient job opportunities, the country has constructed an entrepreneurial ecosystem to support the acceleration of many startups. However, it lacked in providing a robust system, which could bring the same success as it has happened in the Silicon Valley. Silicon Valley has produced many giants such as Google, Sun, Oracle and HP. The Middle East region has suffered from the lack of innovation in the entrepreneurs and also for the legal framework that governs the entrepreneurial ecosystem. However, the environment is now changing. It has been proved by many entrepreneur startup entities such as Flat6Labs. It is one of such names that have been responsible for the startup acceleration of many such as Jumpsuite and Collectionair. Flat6Labs is providing every possible platform, which is needed in a startup business. However, there is still the need of a robust legal system, which could identify the hidden innovation in the country. Investors need to know the place, which is worth for the investment. It is extremely important to have a legal framework like the one that exists in the Silicon Valley. The Middle East Region, in particular, the United Arab Emirates has such investors who can invest in supporting the startup business. However, it is extremely important to identify the potential entrepreneurs and then invest in supporting the startups.
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