As we work to build strength in the Lebanese startup ecosystem, it would be good if we could align around a vision of what it is that we're working to build, why we're working to build it, what it will take for us to get there, and why this is so urgent to do, do now, and do with the same sense of purpose that helped a human walk on the moon or sail around the world for the first time.
And like those other attempts, lives are at stake, and we're moving in unchartered territories.
The latest "Global Startup Ecosystem Report 2017" from Startup Genome gives us some great insight to those whats and whys:
Technology is generating wealth and innovation at an exponential pace but only a handful of places in the world are capturing most of that value creation. Everywhere else, regions and people are falling further behind. Without immediate and aggressive actions to develop stronger startup ecosystems, this divergence will continue and more places will miss out on technological growth and dynamism.
While technology always creates winners and losers, today the gap between them is widening at a rapid pace. Startups are the key vehicle by which regions and their citizens can take advantage of technological change, and startups depend on strong ecosystems. They, however, can take years, even decades, to develop.
Those places that fail to boldly and immediately invest in startup ecosystems, and thus fail to produce startups, will experience economic stagnation. (Page 9; startupgenome.com)
In "Whiplash - How to Survive Our Faster Future", a highly acclaimed book by Joi Ito (Director of MIT Media Lab, and guest of AltCity's predecessor organization to visit Lebanon for a conference back in 2009) and Jeff Howe, they write how "The future is already here. It's just unevenly distributed." Self-driving cars, advanced drones, artificial intelligence, advanced robotics, and rapid increases in automation (amongst other innovations) are not "futuristic", they already arrived, and they're spreading fast. Here in Lebanon, we're still on the lower side of that "uneven distribution", still losing ground to the major innovation hubs in the world that are moving fast, though now hopefully losing ground slower than a few years ago. As Ito and Howe wrote, what's needed is "an entirely new mode of thinking—a cognitive evolution on the scale of a quadruped learning to stand on its hind feet". Here in Lebanon, we likely need to approach this effort differently if we are ever to catch up as the rate of change continues to accelerate.
Let's be at least a bit realistic here and not immediately aim to be in the top 5 or 10 startup ecosystems globally, but we think reasonable that we benchmark to the 20th ecosystem globally to help us form our vision of what we should be aiming to build in Lebanon. In the 20th spot is Bangalore, a city of approximately 9 million people (approximately twice Lebanon in population) in India's southern Karnataka state. Bangalore has roughly 54 accelerators, startup coworking spaces (many of them with events and supports beyond just "space"), and incubators, with a rough "startup hub" to citizen ratio of 1:166,666.
Bangalore also has a lot of poverty, corruption and governance problems, infrastructure limitations, and more.
Here in Lebanon, with a population of approximately 4-4.5 million, we have around 5 accelerators and coworking spaces (depending on how you count, but many are just coming on board or are not fully active, or are tiny in size). This gives us a ratio of about 1:800,000. In terms of actual served ratio taking into account sizes of the accelerators/supports here in Lebanon, the difference between Bangalore and Lebanon would be even larger.
By way of comparison, the estimate of our southern neighbor is approximately 1 accelerator/incubator/coworking space per 78,000 people.
Of the top 20 startup ecosystems globally, many of them are from cities or countries that are not huge in population size, but have strong innovation environments that churn out startups and scaling companies. The top 20 list includes (in descending order starting with #1) : Silicon Valley, New York City, London, Beijing, Boston, Tel Aviv, Berlin, Shanghai, Los Angeles, Seattle, Paris, Singapore, Austin, Stockholm, Vancouver, Toronto, Sydney, Chicago, Amsterdam, Bangalore
So what would it take to build Lebanon into a global innovation hub in the next 20 years? We think we should be aiming for an ecosystem that includes roughly:
1: 25 accelerators in Lebanon.
This should likely include at least 5-7 general tech accelerators (the only kind we have now, plus some diversity of target audience, geography, stage of target startup, etc), 10-12 sector or technology specific accelerators (in core strategic sector verticals, or core strategic technology horizontals), and 8-10 accelerators based in universities, syndicates, or companies. Some people complain that "there's not enough startup pipeline" to support more accelerators, but I wholeheartedly disagree. I think there is substantial untapped potential in Lebanon, but we do not yet have the ecosystem structures set up sufficiently to entice most people to consider joining it. On top of that, we need more accelerators and investors so they can be more involved in helping build the startup pipeline, not just recipients of it. While 25 may seem like a lot, it’s actually not, and we should be immediately pushing to have 10+ accelerators starting in Lebanon within the next 1-2 years, then continuing to add 2-3 accelerators per year until we reach a level of global competitiveness.
2: 10 bootcamp pre-accelerator programs.
Or we need our Bootcamp program to be 10x bigger! We aimed to reach around 1100 "pre-Bootcamp" participants in 2016 in order to reach our target of 100 high quality teams in our Bootcamp program. We ended up reaching over 11,000 people in 2016, 10x of what we planned, but still we had trouble getting the 100 teams that we wanted to get. There needs to be massively more exposure and engagement in universities (for students and faculty), in syndicates, private companies, and even grade school to the processes of innovation and entrepreneurship, in order to build up the culture, mindset, skills, networks, and other foundations for solid entrepreneurial growth. We think every university student and faculty member should have some core entrepreneurial experience every year, yet right now the vast majority have none in their entire lives. We’ve got work to do people!
3: 10x funding available via research/innovation grants, angel funding, and other seed/VC funding.
Yes, funding has increased substantially in Lebanon in the last few years, and still it is far (FAR) from enough. Substantially more funding and funding options should be available, especially for early-stage innovation and entrepreneurship, startup programs and innovation competitions, and applied research. Applied R&D should be a part of every company, syndicate, ministry, and university department in the country.
4: Culture, mindset, governance, and infrastructure.
There are plenty of other issues that need to be addressed in the country to move us in the direction of building a rockstar world class innovation ecosystem, but we don’t have to (and we can’t) wait for any of that to make huge steps forward in building our future country, and our future economy. Most importantly, we need to have the desire, drive, dedication, pursuit of depth and excellence, and collaborative mindset to help us move in that direction. We need to do away with some of the negative competition, territoriality, inhibitions, negative unhelpful criticism, and lack of agency that runs rampant in the country. If we in AltCity were slightly less resilient, we would have given up on our efforts soon after we started working on supporting entrepreneurship in Lebanon in 2008/2009, after being told "you can't", "you're crazy", "Lebanon isn't", "you're dreaming", and more, repeatedly, painfully, so many times.
And yes, we are dreaming, and we might be crazy, but we need many more people in this country to believe we can, and we will, to dream, to be crazy, and to work together to build a strong globally competitive innovation ecosystem despite all the challenges. And we'll turn those challenges into our strengths and opportunities. And yes, we can do it, if we do it together.
Want to read more about building strong startup communities? Here are some great resources:
- Brad Feld, Startup Communities book, White Paper, and Startup Communities posts on his blog
- Startup Genome Research Website
- Entrepreneurship in Conflict Zones (by our friend Ahmad Sufian Bayram)
And so many other great resources for building strong innovation communities. Have some suggestions of ideas, or great resources, or other feedback on this post? Please share in the comments below.