To make this mark, all actors in the ecosystem have specific roles to embrace in order to expand access to finance—a crucial piece of successful entrepreneurial ecosystems. From interviews with nearly 20 influential Lebanese actors in the entrepreneurial ecosystem (including VCs, incubators, entrepreneurs, etc.), it is evident that entrepreneurs themselves have an important, immediate role to play in the development of the Lebanese funding landscape. Be on the lookout for actionable recommendations for other ecosystem actors over the next few days. Below are key actions which emerged in interviews:
1) Learn to bootstrap: Too many entrepreneurs see successes in Silicon Valley as evidence that funding should fall into their lap. As Elie Khoury, co-founder of YallaStartup says, “YallaStartup means ‘start working!’ YOU as an entrepreneur have to start figuring out how to make it work with low funding.” Entrepreneurs in Lebanon need to learn the importance of making sacrifices and bootstrapping. Plenty of entrepreneurs have created highly successful businesses with only limited funding in the early stages, but it required great sacrifice to pursue what they believed in.
2) Be investment-ready: Entrepreneurs should not worry about approaching VCs until they are ready. They need to have something to show–a prototype, a demo or a proven model–before approaching funders. Too often, entrepreneurs show up with a “great idea” and a business plan without any proof of concept or revenue model. “Take the time to go through the process,” advises Walid Hanna of MEVP. “Build the business, work with incubators, be patient, get good mentors and wait until you are ready to approach VCs.”
3) Look for strategic partnerships: After seeking out family and friends, most Lebanese entrepreneurs approach VC firms for funding. However, there is an alternative to traditional VC that can often be a better match – strategic partnerships or smart money. “Liaise with bigger companies that can benefit you in ways other than capital,” recommends Fadi Daou, serial entrepreneur and founder of MultiLane SAL. For example, rather than seeking traditional VC funding, a startup focused on providing media services might consider developing a partnership with a top media agency in Beirut. These types of partnerships can provide strategic direction in addition to funding.
To learn more about where Lebanon is now, as well as read recommendations for how it can fully capitalize on its bright future, please read the full report here.