How will the current economic crisis affect Arab online startups? [Poll Results]

| Apr 20, 2009 | comment 3 Comments

In the latest poll on StartUpArabia, the question to the readers was:

How will the current economic crisis affect Arab online startups?

The result of reader voting came out as follows:

Effect of the crisis

Out of 123 readers who responded to the poll:
- 43% of them believe the effects will be positive
- 39% say they think it’ll affect online startups negatively
 - and the remaining 18% don’t see it having any effect whatsoever

The results are obviously very close, which I guess reflects the existing confusion out there on how everything going on will be affecting different types of businesses on the short and long run.

Personally, my belief ever since the crisis began has always been that for online startups, there is eventually no way but up; I mean, it’s not like they were getting all that many big investments before the crisis, or making really big money from the online advertising market that makes up less than 1% of overall advertising spend. So with the option of investing in real estate becoming unsafe for investors, and with businesses cutting their marketing budgets; if anything at all, it would mean it’s a chance for a bit more investments to make it to the online world, and for a bit more advertising to move online.

From being in the middle of it all, I can actually confirm that this is happening, slowly maybe, but it is happening; more investment opportunities are becoming/going to become available for Arab online startups, and more businesses are currently experimenting with online advertising.

But now comes in the role of the entrepreneurs and startups to make sure they benefit from this chance, build their business case to entice the right investors for them, and make sure that those businesses experimenting with online advertising have successful online campaigns with maximum analytics transparence, so that they see how effective the internet is as a medium and stick to it even when things pick up again.

In short, the crisis can be a great time for Arab online startups if they grab the opportunities it offers them and are ready to jump on any chances hidden in its midst. 

What do you think? What’s your view of things?

  • http://www.hiconomics.com Hichame Assi

    Somehow I missed the poll, but overall I think I agree with the fact that the recession should prove positive for Arabic startups…
    The recession and loss of funds in the west is likely to be a wake-up call for investors so it's likely that more money will be invested locally where it can be better controlled. Not to mention it seems a lot of well educated and experienced human capital is returning to their home nations…

  • http://www.startuparabia.com Mohamed Marwen Meddah

    Yeah that's another interesting point, a number of people with experience in the west are actually heading back to the region now to set up their own businesses and all, and that is a factor in the development of the sector.

  • http://www.startuparabia.com Mohamed Marwen Meddah

    Yeah that's another interesting point, a number of people with experience in the west are actually heading back to the region now to set up their own businesses and all, and that is a factor in the development of the sector.

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