Herve Cuviliez

First of all, thank you for your support in this project. All your feedbacks and help offers showed that we are doing the right move.

In an international crisis like the one we actually living in, cards can be reshuffled in a snap.

Six months ago, Dubai had no competitor, everybody wanted to move there

When we took the decision to establish Kuv Capital head quarters in Beirut instead of Dubai, everybody explained us what enormous mistake we just made.

And when you look at the brutal facts, they were right.
In Lebanon:

• Broadband is expensive, slow and unreliable,
• Getting a stable electricity is a challenge
• Mobile plans are a ripp off
• Lebanon is unstable, etc..
• GDP is 4-6% at best

Where in Dubai:

• Broadband is fast and stable (but also really expensive and restricted)
• A double digit growth
• Freezone
• An international workforce

But our job is to anticipate trends, and we strongly believe that Beirut has a window to become a Digital Middle East Hub.

How I dare say that with that weak broadband infrastructure, unreliable power grid and Lebanon inability to reform itself?

Well, create a company is cheap and easy in lebanon (limited liability company starts at 3500 USD), so it is for office expenses, labor cost is for less expensive than in the GGC countries and last but not least there is great talents here.

All these are the necessary ingredients to create a startup and have a low burn rate. On the opposite, Dubai has been design to become the middle east headquarter for international groups, so offices are great but really expensive, so is the cost of living (talking about the expensive part), incorporation cost and minimum capital requested are too high, etc..
and this is not startup friendly.

So why Beirut is not considered? Because Beirut has a marketing/branding issue, nobody knows what is really happening here. I spent my last 8 months in Beirut and I can tell you a lot is happening here. I met amazing people and discovered great companies (see Rootspace for example).

How to solve that branding issue?

As a first step, we need to structure all initiatives as a real ecosystem by creating synergies, meeting, conferences, etc.. make it more readable for foreigners.

But to accelerate this change in perception, we need go a step further. we need an iconic project to create a international buzz.

So we decide on to work on a crazy project: Create a media city in Lebanon.

Here is the idea. Find old warehouses or factories, rehabilitate them in offices with decent broadband and electricity, free spaces for students who want to work on innovative projects, Showroom for high tech companies, etc..

No it’s not a only a dream. We have already spotted 3 places around Beirut, talked to investors, convince 6 digital related companies and a media group to move in, etc..

The Silicon Valley started like this 20 years ago by gathering one after the others in place around San Francisco, Why not us ?

We will air a blog soon to gather all the information and coordinate actions

If you think I’m crazy, please let me know,
if you want to help, please declare yourself,
if you just want to show your support, leave a comment
if you just want to get updates, drop me an email.

I just spent a year travelling in the middle east (Dubai, Abu Dhabi, Jordan, Lebanon,…) and I even moved recently to lebanon. I’ve met a lot of people in the industry there.

And I was impressed by the market evolution in a year.

• Internet penetration is booming (21,3% penetration with 32% in Kuwait or 38,4% in the UAE) more on Internet world stats.
• Mobile penetration and usage is even more impressive (150% in the UAE), see my previous post on this: Mobile innovation, start looking at emerging countries.

On the startup side, things start to be organized and new projects are released every week. here is some good sources of information:

• Arabcrunch.com is dedicated to profiling and reviewing Arab originated startups.
• Startuparabia.com is talking about Arab startups and entrepreneurs
• The twitter of PV Tribal DDB is giving daily news about internet and mobile markets in the region.

On the funding side, things are still a bit messy but one good initiative need to be be named. It’s the ABAN (Arab Business Angels Network) and they organize a meeting every quarter with for 4-6 selected startups + some guests.

My opinion? VC’s should start considering this market with a population of 200 millions people, a strong growth, and a huge appetite for new technologies.

Without disclosing any secret, guess where my next project will take place.

Most of startups are relying on online advertising with the very same principle: create a service, get a massive audience and try to monetize it.

Everything seems to be ok as long as online advertising is growing fast.
But the future of online adverising is elsewhere.

The online advertising 1.0 (today) is a copycat of the traditional advertising: Get me a massive audience, interupt what they are doing to expose my brand or at most click on my ads.
I’m talking about any kind of display advertising ( banners, over the page, etc..)

The online advertising 2.0 (what I’ve called Advertising on demand in a recent post) will be totally different by moving from a “look at my fantastic product” attitude to a “what can I do for you” one.
I mean by that propose to customers services they care about in your aera.
Nike made that move sometimes ago with product like Nike Ballers network, a facebook application where basketballers can: find a court, add your home court, find a game and schedule your own game and invite other players

Startups will have to review their copy if they want their share of the online advertising manna.

They will have to propose customizable version of their product in order to move their ad based business model to a b2b services businness model.
And from the success and the leadership will depend their revenues on the B2B side. Big brands don’t work will losers.

A couple of months ago, I have created an account on Kiva.org. Kiva enables you to loan to small businesses in developing countries.

You can see my lender page here.

I’ve helped among others 2 projects, one Internet cafe (Loan Requested: $975.00) in Ayacucho, Peru and one bookstore (Loan Requested: $975.00) in Agoe, Togo.

Small Amount of money to be honest ($100 + $10 donation to Kiva). It was a trial to verify by myself if the social business concept is really effective.

The answer seems to be yes because i just received the first repayment from both projects.

It’s a great feeling to see these projects becoming a reality and more important repaying their debt to give others the opportunity to been also helped.

I’m working on a project in the mobile area. I love this moment when you just keep thinking / discussing about it.

but here is the big question? what will make the difference ?

Of course, I start to have some experience but frankly it sometimes really hard to figure out what will make that vital difference.

Here is what I’ll try to always have in mind

Insights: my marketing background has taught me that a new service has to be based on a real need or solve something. We all are lazy, we don’t use something because it’s really smart or high end technology, but only because it’s fun or it helps. Never compromise on this.

KISS (Keep It Simple, Stupid): as soon as, we have this good idea, our first temptation is to sophisticate it more and more, adding options, etc…
You should do the opposite by trying to squeeze everything that is not vital to serve your idea. that way, you will make a easy service/product to use. If I need to read the manual, you are done. To read more on this: an article of Jacob Nielsen on BBC.co.uk: Web users getting more ruthless.

User Experience: you can the best idea ever if the user experience is weak, you will fail.
that’s where the alpha and beta version is useful, getting feedback not only for the marketing trick.
A good way to illustrate this is the following: In the Internet and Mobile, the User Interface is like a windows between the consumer and your service. The clearer is your window the more you consumer is seeing your service.

Timing: I’m actually reading “the singularity is near” by Ray Kurzweil and I will quote him on this:

Most of the inventions fail not because the R&D department can get them to work but because the timing is wrong

Inventing is like surfing: you gave to anticipate and catch the wave at just the right time hope that helps.

Please, don’t hesitate to comment and share your finding

With a price ratio 1:20 comparing to PCs and a vaste majority of the population living with few dollars a day, it’s a no brainer to understand why mobile penetration is 10 times bigger in emerging countries.

For that reason, we will see mobile innovations coming from those countries in years to come.
Want signs of this?
South Africa is about to release a voting system through mobile for local, regional and even national election.
Bangladesh mobile operator Grameen Phone has gave information access (information is key for a farmer, for example. It’s helping him to know to where and when to sell his production instead of relying on local resellers) to poor people through 16 millions lines.
M-banking is the future of banking in Midle East & Africa (Etisalat has released last month a mobile wallet)

I see more and more mobile innovations coming from Africa (see dreamoval), middle east and of course India & china.

Kill cliches about tech innovation always coming from developed countries and remember

from the necessity come the creativity

If you know any others innovations there, please continue the discussion by leaving comments

Cashstore has released a version on cashstore in spanish : cashstore.es. The team has received a warn welcome from the market with dozen of press articles and more than 84 000 results inside google.com (to have the updated number click here).

I hope it will be in Spain the same success as it is in france.

I went visiting the Digiport in Lille (north of france).
they provides a full range of services for IT companies from a business park to host your business to personalized support for your incorporation.

I was really impress by the quality of the infrastructure and the skills of the team.

If you are a startup CEO looking for the perfect place for european headquarter, you should really consider this place.

Cherry on the cake: By the high speed train, London is at 1h20, Brussels at 30 mins, Paris at 1h and charles de gaulle airport 40 mins.

While the vaste majority of us just getting tired of facebook, the Web 2.0 is entering into phase 2. I will say a more mature phase.
With phase 1, we learnt how to connect to each other, sharing basic information, etc… I’m talking about facebook, dopplr, linkedin, Xing and hundred of others.

With phase 2, we will learn to share informations with others forms of intelligence. I’m talking about artificial intelligence, I’m talking about robots, sensors, any kind of devices. Scared ?
To make it simple, everyday there is millions of information gathered by sensors that could be valuable for us: temperature sensors, mobile for localization, wifi hotspots, RFID chips, etc…
In fact, we are already surrendered by sensors collecting information and “socializing” between them.
This phase 2 will be the connection of this 2 kinds of social networks: us and them.
Don’t Believe me ? Need some signs ? Here is some

Tim O’Reilly at the ETech08:

the future of Web 2.0 will be applications driven by sensors

But in fact, the first person, i ever heard talking about this, is Bernard Benhamou that’s was a year ago and he made a interview (in french) about this in may 06.

and then start to google this there tons of pages on this: A good article on the economist

So what’s new ?
It’s getting real. In 2008, we will move from prospective to concreate applications.

Need another sign ?

Yahoo just released Fire Eagle (a way to share your location with sites and services online) that collect localization informations and centralize them in an unique application then you can feed this into your applications. Sources could be wifi hotspots, mobile, gps, etc…

I will continued to investigate that and invest myself and my money into this type of application.

To be continued…