BEIRUT: More deals may be made at ArabNet Riyadh, but Beirut is the host city that people get truly excited about the regional technology conference.
In Beirut, a supportive IT community, a growing network of venture capitalists and a creative environment generate a buzz unlike that of any other city in the region, ArabNet founder Omar Christidis says.
At his office in the capital’s Hamra district, the young CEO is counting down the days until the big gathering that attracts speakers from all over the world.
He excitedly discusses how far Lebanon’s IT sector has come in the five years since he started the conference, even as the country’s political tension has grown.
“People who come here have an amazing time. I can tell you that people get a lot more excited about ArabNet Beirut than ArabNet Riyadh – even though people do more business there,” Christidis says.
“This is the fifth time we’re doing the conference in Beirut, and the local community is still supportive.”
“In other markets people are busier. People are focused on their work. We’re still here, good or bad.”
It is perhaps these bad times that make the growing success of the sector, which stands in stark contrast with other struggling industries such as hospitality and tourism, all the more rewarding.
Christidis points to an engaged caretaker telecoms minister, Nicolas Sehnaoui, who has become a regular participant in local technology events. The CEO also credits a Central Bank that has begun easing difficulties of startup funding through $400 million dedicated to equity investment in VC funds and startup incubators and accelerators. And he mentions a plethora of relatively new entrepreneurship associations that work to nurture local talent and creativity – all of which will take part in the upcoming conference.
“Nowhere is as vibrant as Lebanon,” Christidis says. “People come here to spot talent, and that’s not going to change.”
Indeed, the numbers show that interest in Lebanon’s digital sector continues to grow – a testament to the country’s highly skilled, creative and resilient workforce.
Online advertising in the MENA region is increasing at a rate of around 35 percent a year, and is projected to reach $1 billion by 2017.
Lebanon is the unmatched leader of the sector in the Levant, with $463 million in advertising spending.
The trend is only expected to accelerate with more people switching to digital media for their news and social networking. Last year marked the first time that Americans spent more time using digital media than TV, a habit that will likely soon become a worldwide norm.
Investors are taking note of the changing times.
Three times as many IT investments took place between 2010-12 than 2006-09 in the MENA region, with most ventures occurring in Lebanon, Morocco and Tunisia.
Investment initiatives in IT throughout the region show the confidence the sector is generating.
Berytech is slated to invest $30 million in startups with a focus on the creative sectors, while Fadi Ghandour, founder of the Jordanian logistics and shipping company Aramex, is raising $75 million to $100 million for early-stage ventures in Egypt, Jordan, Lebanon and Palestine.
Christidis notes that most of these regional investments are aimed at Lebanon, which has become a major exporter of mobile products and services, despite the country’s notoriously weak infrastructure and security.
“A lot of Lebanese businesses are selling to clients outside of Lebanon. They’re living on airplanes,” Christidis says, remarking on the perseverance of Lebanese IT companies in a difficult climate at home – whether they are coders behind the scenes or are capitalizing on Lebanon’s role as a regional trendsetter in the creative sectors, such as selling up-and-coming fashion through e-commerce.
Christidis predicts that in the next 12 months the Middle East region will see $250 million smart VC investment for startups.