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December 14, 2021updated 28 Jan 2022 11:37am

How B2B start-ups in the Middle East are being empowered to solve business challenges

Microsoft for Startups’ Middle East GrowthX Accelerator connects B2B tech start-ups in the region with large corporates, helping them solve some of the world’s most pressing business challenges. The first cohort, who ‘graduate’ in December 2021, also serve as a fitting showcase for the increasing sophistication and talent evident in the Middle East’s start-up scene.

A 12-week programme, the GrowthX Accelerator is first and foremost a co-creation scheme. The 3,000 start-ups that applied did so because they believed their technology could help address a specific challenge being faced by one of the programme’s corporate partners. Those who made the cut were able to test, validate and hone their solution with the goal of delivering a prototype within three months.

Conversational AI provider Spitch was among the 15 successful candidates. Within GrowthX, they have teamed up with Etihad Airways to create a voice bot that can answer questions about Covid restrictions across the airline’s global network. They will deliver the English-language prototype in December and are already in the process of developing further use cases.

Meanwhile, digital payroll scheme Hi55 Ventures worked with Turkey-based Akbank to build a system that could provide working capital for SMEs. When they were first asked to get involved in the scheme, the team at Hi team didn’t even realise it was a competition. As their 12 weeks draw to an end, they plan to have agreed upon a proof of concept with Akbank, which they can then develop into a prototype, to be further refined over the next few months.

According to Roberto Croci, managing director of Microsoft for Startups Middle East, the organisation’s role as facilitator of the programme has been to remove the roadblocks that can prevent start-ups and corporates working together effectively. “Our main objective for this first cohort wasn’t to convert everything into paid proof of concepts; we wanted to help the two players work together, set the right expectations, avoid surprises and be aligned on their objectives,” he says.

The partnership between Etihad and Spitch was an example of the best-case scenario. “Spitch understood the challenge from Etihad and there was an openness from Etihad to evaluate the proposal and figure out how they could work together. This is invaluable for B2B start-ups,” Croci explains. “If a start-up can thrive in an environment with a big corporate and Microsoft can support on the tech side, what else can you dream for? It’s an opportunity to build a case study, amplify your story and then leverage that with other customers.”

Workshops: ‘A volley of knowledge’

On the tech support side, all the start-ups involved in the scheme received credits they could use towards training, support and licenses for Azure, Microsoft’s open cloud computing platform. In addition, they were invited to attend workshops and knowledge sessions on everything from pitching to investors to payment platforms.

“There was a volley of knowledge and meetings from very interesting speakers on how to pitch and how to approach funders,” says Hans-Nicolai Hars, managing director of Hi55 Ventures EMEA. If anything, Croci admits there was perhaps too much information being made available. “Some companies told us they didn’t have time to attend all the sessions, so we want to calibrate this a bit better next time so as not to overwhelm them,” he says.

Piergiorgio Vittori, VP of business development at Spitch, also appreciated the opportunity to network with his fellow entrepreneurs. “The companies that got through were pre-selected so we’ve been able to talk to the best you can find in the market, in a variety of sectors,” he says. “I was very interested to exchange ideas in brainstorming sessions with companies from different parts of the world under the umbrella of Microsoft.”

A gateway to the Middle East market and beyond

Both Hi and Spitch plan to use the GrowthX Accelerator programme as a jumping-off point to grow their businesses in the Middle East. Vittori says Spitch plans to start discussions with another partner of Etihad and Microsoft, which he believes will open doors to other customers in the region.  Microsoft has also offered to support the company in the process of setting up a Middle East office, if they decide to go down that route.

Hi also wants to build up its capability to support clients in the Middle East. The company has recently signed a joint venture for Saudi Arabia and is in discussions with a potential partner in the UAE. “It’s really on us to start to think about how we are going to maximise that opportunity,” says founder and CEO David Brown.

It’s no small opportunity. In 2021, investment into start-ups in the Middle East is set to double compared to 2020, crossing the $2bn barrier for the first time, with FinTech and FoodTech the most popular sectors. “It’s still very small compared to more mature ecosystems, but it’s expanding year over year and the number and size of deals is also growing,” says Croci.

The quality of start-ups is following the same trajectory. “We see more mature start-ups that are trying to think more globally. They don’t want to be copycats or simply localise an existing business model; they’re coming up with original ideas that could potentially be exported from here to the rest of the world,” Croci explains.

“We’re also seeing signals of more B2B start-ups being created, as opposed to the traditional focus in this region on consumer business. They’re becoming more sophisticated and using more advanced use cases that require machine learning, IoT and blockchain.”

Companies that have the opportunity to learn from – and co-create with – market-leading corporates through the GrowthX Accelerator will undoubtedly have an edge on their competition. The first cohort looks set to prove that, with a little support, the Middle East can be in the vanguard of generating and delivering real-world solutions, bringing genuine, real-world value to the region and beyond.

Tech entrepreneurs in the Middle East can apply to join the Microsoft for Startups community now

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