An interesting interview to Dr. Ahmed Sobhi, Dean of SSM Egypt.
Recently, the concept of entrepreneurship became an obsession for a wide range of young people in the Middle East and North Africa. Many recent concepts emerged in efforts to explain said obsession including the phenomenon entitled “Entrepreneurial Fantasy”.
In contrast to the quite common belief that the largest segment of successful entrepreneurs is in their second and third decade of life, the average age of entrepreneurs who managed to linger their startups to reach a successful profit margin is averaged to be within the forties.
Undoubtedly, entrepreneurship is an important step for achieving strong economic growth and development as well as creating new job opportunities. It was even included as a basic factor of production, along with classical elements such as land, labor, and capital.
According to the Office of Advocacy in the United States of America, in a period of 21 years, from 1992 to 2013, startups and small enterprises accounted for 63.3% of new jobs.
However, it is not without fantasy and exporting the world of entrepreneurship as if it were a magical world in which those working in it belong to the world of metaphysics. I even coined a term that reflects this way of offering, which is “The Meta-Entrepreneurship”.
Meta Entrepreneurship as a term that reflects the existing obsession in entrepreneurship, which depends on the excessive presentation of the entrepreneur as an economic superman!
I certainly read news of millions of investments every morning on multiple projects in the region. Additionally, I uncovered that the volume of investment in emerging projects in the Middle East reached 277 million dollars in the first quarter of 2020, of which the Arab Republic of Egypt wins the lion’s share by 37%, followed by the United Arab Emirates by 25%, then Kingdom of Saudi Arabia at 10%.
However, questions remain unanswered, such as:
- How many ideas have been completed and become a real project that generates sustainable profits?
- What is the real percentage of continuous successful companies?
- Do the evaluation methods truly express the company and its hopes for its future growth?
The extent to which investors are willing to pump money is determined based on future estimates of what will happen. The size of the investment does not always indicate the extent to which the company will continue its path to success. There are also many examples of companies that fell due to monetary scarcity after injecting investments exceeding $100 million.
According to Stanford University, out of 4,000 ideas, 226 are prototypes, 12 are commercial enterprises, 2-3 are truly successful. That is, the rate of real success for the ideas commercially is 0.0005%.
This scene is at the corporate level. As for the scene at the individual level, is it right to say that everyone is fit to work as an entrepreneur without taking into account individual differences? Furthermore, if you register for a training course that does not exceed three days, will you become a successful entrepreneur?
With time, the theatrical reality that takes precedence over the scene has turned into an integrated play in which everyone claims to believe the illusions and fantasies that are being exported. According to the Global Entrepreneurship Mode, half of those employed in a steady-income job see creating a personal business as better than a job, regardless of any other considerations.
In my opinion, people should understand that giving up a job and running into entrepreneurial fantasies comes at a huge cost. Contrary to the popular belief that all emerging ideas can easily obtain financing to start the company, 67% of entrepreneurs resort to their own savings and the savings of relatives and friends for the start of the company only.
Entrepreneurial ambition
I am not advocating giving up on entrepreneurship. On the contrary, I call for its support
I’m not against entrepreneurial ambition, on the contrary, I call on all parties to deal with it seriously, so that it does not turn into a bubble that disappears over the years. In particular, we mention the parties to the equation and the eco-system consisting of:
- Academics who are required to develop truly entrepreneurial curricula that contribute to creating a culture of entrepreneurship even for employees within companies so that they can achieve entrepreneurial ideas within their companies. Moreover, develop means of measuring competencies based on the requirements required of the entrepreneur and not the ordinary employee.
- A business community and investors who are more serious in their search for startup ideas. Additionally, to support them with an undivided focus on market needs. In a study by CBInsights, the reasons for the failure of about 42% of the startups globally is that there is no need in the market for the good or service provided.
- A civil society and NGOs to promote these ideas and startups while implementing them in cities and villages and not only in capitals. This means the NGOs will need to organize conferences, events, and pieces of training for inhabitants in villages and perhaps fairs to promote these startups.
- Governments are required to legislate more revolutionary and appropriate policies to cope with the nature of the emerging entrepreneurial activities.
In the end, numbers speak. According to 2ndSite Inc, a company that handles accounting work for small and medium companies in the United States of America, 97% of founders of successful startups and small companies in the United States of America will not return in any way to a fixed-income job. However, without discussing the sacrifices that follow this decision, it can be argued that it is the success that supports this belief.
No one talked about the extent of the suffering in finding employees and work teams to work for startups, for example! In the same study of the aforementioned CBInsights, the reason for the failure of 23% of startups is due to the lack of harmony between a good team with the necessary competencies.
Likewise, no one spoke about the difficulty of obtaining the necessary investments to ensure the company’s progress. About 29% of the startups fail to reach a profitable equation that preserves their capital before the investment pump stops.
Final Words
Now, we are at a crossroads between keeping entrepreneurship in a theatrical form or turning it into a real contributor to the growth and development of the region’s economy. To live the scene with complete and real details devoid of any pretense or dramatization, let us move forward in achieving the necessary roadmap that I mentioned in this article and follow GoDaddy’s steps of supporting startups and entrepreneurs. You can find many inspiring stories of entrepreneurs and startups who succeeded in creating their mark within the MENA region here.