Arab Spring, Start-Up Summer?

Written by Holly Pickett for The New York Times.

Business groups are taking an interest in Egyptian entrepreneurs like Yasmine el-Mehairy, left, and Zeinab Samir, who started a site for Arab women.

LIKE so many other young people in Cairo, Yasmine el-Mehairy saw no future in Egypt. What she saw was a dead end.

Then came Tahrir Square.

Six months after an uprising led by people like her ousted Hosni Mubarak and overturned the established order of the Arab world, Ms. Mehairy has joined the ranks of Egypt’s newest business class: the entrepreneurs of the revolution. Instead of leaving Egypt as she had planned, she is staying to nurture a start-up called SuperMama, an Arabic-language Web site for women that has 10 local employees.

“The revolution really made my generation believe in ourselves,” Ms. Mehairy, 30, says. If Egyptians can topple Mubarak, she wonders, what else might they accomplish?

That is a sobering question for educated, affluent Egyptians like Ms. Mehairy — people who, unlike most Egyptians, have other options. She has a master’s degree in interactive media from the University of Westminster in London and hoped to move to Britain or Canada.

The revolt now known as the Arab Spring placed Egypt on an uncertain course. After years of corruption, its hidebound economy is reeling. Tourism and investment have plunged. Mass unemployment — which fed Egyptians’ anger — has worsened and protests in Tahrir Square continue. The nation will elect a new government in September, and it’s anyone’s guess what will happen then.

Yet for all the uncertainties, some of those who embraced Facebook and Twitter during those heady days in Tahrir Square are now busily trying to start or continue working on Web sites and Web applications that they hope will yield profits and jobs.

“This is an unusual revolution in that it was led by a very educated and economically conversant, forward-looking group of people,” says Khush Choksy, executive director of the United States-Egypt Business Council, which is part of the United States Chamber of Commerce. “But to secure what they really went into Tahrir Square for, there needs to be economic growth, a modern set of thinking, and a more diversified economy.”

Ms. Mehairy wants to seize the moment, and she and Zeinab Samir, the co-founder of SuperMama, have been on the move.

In June, the pair applied for a spot at the NextGen IT Boot Camp, which took place in Cairo in late June. The program was sponsored by the Global Entrepreneurship Program, a collaboration between the State Department and the United States Agency for International Development.

During the five-day program, which was also sponsored by the Danish and Egyptian governments, six American entrepreneurs — including Jeff Hoffman, co-founder of Priceline.com; Ryan Allis, chief executive of the marketing site iContact; Shama Kabani, chief operating officer of Marketing Zen; and Scott Gerber, founder of the Young Entrepreneur Council — helped 38 Egyptian entrepreneurs hone their business plans. On the last day, four winning teams were chosen. Two will go to North Carolina this fall for a three-week internship at iContact, and two will attend a three-month training program in Denmark. (Ms. Mehairy and Ms. Samir will be heading to Denmark.)

Most of the entrepreneurs in the program are well educated, have jobs, and are from middle- and upper-middle class families. But they still face much uncertainty.

“Everyone is worried about what will happen next,” said Marwan Roushdy, 20, a student at the American University of Cairo who is developing an app called Inkezny to locate hospitals anywhere in the world. The name means “rescue me” in Arabic.

Despite the political situation, Mr. Roushdy, who participated in the boot camp and won an internship at iContact, is working on his app. He is trying to block out his worries about the future and focus on his business. After all, what else can he do?

“Part of being an entrepreneur is being an optimist,” says Steven R. Koltai, senior adviser for Global Entrepreneurship at the State Department, who has visited Egypt a dozen times in the last year. “Entrepreneurs are like the crab grass that grows up in the city: they are going to make it through the cracks in the sidewalk.”

Still, these young entrepreneurs eventually will have to navigate the bureaucratic hurdles of registering their company with the Egyptian government, a notoriously difficult step that Ms. Mehairy says she won’t take until a client or business partner insists.

“The paperwork is a nightmare,” she said. “And in the past, prerevolution, you needed bribery to get your paperwork through.”

Ms. Mehairy has heard some encouraging stories, however. “My friend finished the registration for his company in a day and half,” she says, “because the person handling it was ‘all fueled up with the values of the revolution,’ as we say.”

Mohamed Rafea, 30, and his cousin Ali Rafea, 23, are also optimistic. They along with three other young relatives co-founded Bey2ollak, an app that lets users warn each other about congested traffic routes. “We are lucky that we don’t need the support of anything except good wattage, as opposed to manufacturing goods or opening a store. Those kinds of businesses need the support of the government,” Ali Rafea explained.

In a city where commutes can average two hours each way, their app found an instant audience. As of this month, it had more than 50,000 subscribers and a strategic marketing and advertising partnership with Vodafone, one of the largest mobile phone operators in Egypt.

Like many in their cohort, Mohammed and Ali Rafea, who won one of the internships at iContact, are trying to solve some of Egypt’s problems through technology — and hope to turn a profit in the process. After the revolution, they said, Egyptians were turning to Bey2ollak to pass along information about the safety of the roads. “We added a new status to say that a road is a danger zone and there are protests and thugs,” Mohamed Rafea said.

Mr. Roushdy is trying to solve another problem with his app — unreliable medical services. “In Egypt, even if you dial the emergency number 123, it is not always a guarantee that an ambulance will come,” Mr. Roushdy explained. “So I thought an app that showed the nearest hospital and phone number would be a useful service.”

For some of the six American entrepreneurs who visited Cairo in June, it came as a surprise that there was such a vibrant start-up community in Egypt.

“Reading the newspapers and seeing the news, the observation coming in was that there really wasn’t a culture of entrepreneurship here,” said Kevin Langley, who was part of the American delegation and is global chairman of the Entrepreneurs’ Organization, a network of business owners.

The goal of the Global Entrepreneurship Program is pragmatic, explained Mr. Koltai, who came up with the idea for it.

“The point is to create jobs,” he said. “Jobs are the single most important underpinning for civil society and economic growth, and that is true whether you are in Ohio or Egypt, and the biggest driver of job growth is entrepreneurship.”

Egypt is certainly no stranger to the relationship between civil unrest and joblessness. Youth unemployment, which still hovers in the double digits but is more of an issue for those without a college degree, was one of the underlying forces that led to the revolution.

FOR some of the Web entrepreneurs, there are already some success stories. In January, through a delegation organized by the Global Entrepreneurship Program, a group of United States investors and entrepreneurs traveled to Cairo to meet with Egyptian entrepreneurs. During that visit, organizations like the Chamber of Commerce, the American University in Cairo and Sawari Ventures, a Cairo-based venture capital firm, hosted a business plan competition that awarded two companies $20,000. One of the winners was Kngine, a search engine, which was started by two brothers, Ashraf el-Fadeel, 30, and Haytham el-Fadeel, 23.

The competition helped persuade Ahmed el-Alfi, the founder Sawari Ventures, to bankroll Kngine. He had connected with the founders on Twitter.

“Having eight outside people look at the company, and the fact that they won, helped with my decision,” Mr. Alfi said. Kngine now has 12 employees. The company recently met with a number of investors in Silicon Valley. For investors, there is certainly a case to be made to look at this new crop of companies: there’s an opportunity to get in early in a much less saturated Internet market because only a third of Egyptians use the Internet at home, according to the Ministry of Information and Technology. In other words, these young entrepreneurs have the first mover advantage in spaces that are already crowded in other parts of the world.

Seeing the potential in Egypt, Mr. Alfi left Southern California in 2006 to move to Cairo. “Most of my friends questioned my sanity for making that move,” Mr. Alfi said. “But I was very encouraged by what I saw.”

At SuperMama, Ms. Mehairy and Ms. Samir, 29, who financed their venture with personal savings, are positioning themselves to be one of the first Arab-language Web sites focused on mothers. The site, plus a smartphone application, is to be introduced in September, and will offer information on child care, pregnancy, nutrition, cooking and health. They are hoping to capitalize on the fact that women make up almost half of Internet users in Egypt.

Those in the entrepreneurial trenches are certainly aware of the challenges to being on the forefront of a movement. The lexicon has not even caught up with the times yet. “We went to a training camp and they were calling us ‘businessmen.’ We are not businessmen, we are entrepreneurs,” Ms. Mehairy said.

The hope is that with a little money and a lot of hard work, Egypt could leverage its huge population of young people — over half the population is under 29 — and a strong pool of technical talent. Low start-up costs for Internet businesses could turn Egypt into one of the region’s entrepreneurial hot spots.

That is the dream, anyway. But Mr. Allis, the co-founder of iContact and an investor in East African tech companies, said he was encouraged by what he saw in Cairo.

“These entrepreneurs are thinking big and globally, and they are creating Web apps that you could see in Dumbo or Palo Alto,” he said, referring to the neighborhood in Brooklyn. “They are building companies and products that can be very influential. I would invest 30, 40 or 50 thousand dollars in these young entrepreneurs.”

And, actually, he will buy into these ventures.

At the end of the boot camp, the six American entrepreneurs and one member of the Danish delegation decided to create a $125,000 fund of their own money to invest in Egyptian tech companies.

As Mr. Gerber, one of the American delegates, put it: “We were just so amazed by the business acumen we found in Egypt.”