Middle Eastern Youth See Business as a Solution to Unemployment

By: Hyacinth Mascarenhas

As global economies slowly begin to find their footing again, certain industries such as the newspaper industry are still struggling after the world-wide economic crisis. With declining revenues from print sales, modest flow of revenue from paywalls and drooping employment rates, times are bleak for the newspaper business. Research firm IBISWorld even ranked newspaper publishing No. 5 on the list of fastest-dying industries in the US at an average rate of 6.4 percent.

One startup, however, hopes to address the number one problem for the newspaper industry – making money.

Presseract, a web app that allows users to subscribe to their favorite news sites on a single, shareable page, is in the works by a group of entrepreneurs from NYU-Poly. The app, which will be presented at the NYU Entrepreneurs Challenge, allows users to “become the editor and publisher of their own newspaper” and opt to buy certain sections of their favorite newspapers, like the NYT Opinion section or the LA Times Culture section for 99 cents a month, as opposed to purchasing the entire newspaper.

Calling it a “Netflix for subscriptions,” Ali Al-Ebrahim, the founder of Presseract, says the app also would also allow users to add their favorite blogs, Tumblrs, and Twitter feeds making it a complete interactive newspaper experience catered to their personal preferences.

“Netflix changed the movie and TV industry. They created a new way for people to buy and watch movies, a way that made more money for the creators and was a better experience for users. iTunes did that for music,” said Al-Ebrahim. “We’re going to do it for the news industry.”

Born and raised in Kuwait, Al-Ebrahim is just one of many budding entrepreneurs emerging from the Middle East, a trend buzzing in the Arab world.

With half of its population under the age of 25 and youth unemployment currently at 26.4 percent the Arab region continues to struggle to generate jobs, according to the International Labor Organization. Entrepreneurship and business is, therefore, seen as a popular venture for Arab youth to generate employment opportunities and jobs for themselves.

Although seen a rising trend in the region, entrepreneurship as a career path, is not an encouraged one in the Middle East.

New York Times’ Vinita Bharadwaj writes that risk-taking is actually culturally discouraged due to fear of failure in the Middle East. “Emphasis is placed on safer education and career choices…,” Bharadwaj writes. “Bankruptcy is considered a criminal offense in several countries; a bounced check in the Emirates can land a person in prison.”

When it comes to funding these ideas, young entrepreneurs with limited experience are often seen as high-risk, unreliable ventures for banking systems as opposed to the more reliable family business models that have thrived for generations.

However, many companies are emerging in the Middle East with the goal to encourage entrepreneurship by bridging the gap between innovative ideas and funding through networking, investment and business support.

Investment network company, SILA Tech, for example, works to promote and encourage job creation through entrepreneurship by connecting investors and startup companies.

Founded by Her Highness Sheikha Moza bint Nasser in 2008, the company aims to bridge the “funding gap for startups and early stage companies” in Qatar in addition to promoting participation and engagement of Arab youth in the country’s economic and social spheres.

Originating as a term for investors in Broadway theater, ‘angel investors’ form the core of the company and are defined as wealthy individuals who provide funding for investment purposes, personal fulfillment and networking paired with “a sense of responsibility to contribute to their community or country.”

“If the SILA Investment network can bring the two [young entrepreneurs and experienced investors] together and begin the process of creating alternatives to traditional banking provision and finance, you could possibly unlock the space of entrepreneurship and provide one answer for young entrepreneurs to see their projects move from the space of conceptualization to the real world…,” said Silatech CEO Dr. Tarik Yousef.

With a focus on entrepreneurship, many universities encourage their students through programs, courses, and even majors in entrepreneurship and innovations.

Al-Ebrahim said he knew he needed another way to stand out after his grades in high school weren’t up to par, and NYU-Poly gave him the push he needed to venture out into the field.

“There’s constant talk about startups and business plan competitions on campus, and they make all students take an innovation class, where we read about successful inventors and entrepreneurs. I decided to give it a shot, so I started looking for problems to solve and build a business around.”

After working on the app for a year now and the beta version of the product online, Presseract is still in its initial stages with the team still talking to professors, journalists, lawyers and media experts including New York-based venture capitalist Fred Wilson, the NYT, Reuters, AP. However, most have asked to see growth and users before diving into this venture.

“They all agreed that a big change is going to happen in this space,” said Al-Ebrahim. “They just still don’t know that it’s going to be us.”