After a week in Dubai for business, I headed over to Cairo for the RiseUp Entrepreneurship Summit. The conference was stunning in its scale. Some 4,000 registrants crowded into several sprawling campuses to network, listen to speakers, and get exposed to the entrepreneurial dream. I also spent a day being a tourist. As always, the locals on the ground were exceptionally nice and helpful and oftentimes inspiring.
Here were some of my takeaways from visiting Egypt for the first time.
Pure chaos. From the moment you land in Cairo, you begin to spot cultural norms that are telling. After the plane touched down, while it was still moving and taxi-ing to the gate, the local Egyptians just got up and started taking their bags out of the overheard compartments. The flight attendants didn’t bother to try to stop them. Then, upon exiting the airport and getting in my driver’s car, the driver noticed me looking for a seatbelt that doesn’t exist. “Don’t worry,” he says, “You don’t need one. You’ll see.” We began our seatbelt-less drive into downtown Cairo. We never moved faster than 15 MPH. The traffic is so stifling that even if there were an accident no one would get hurt since everyone’s moving so slowly. The slow speeds don’t stop folks from honking, though. The honking squeals non-stop throughout the city as cars maneuver on roads without lanes and pedestrians attempt to cross streets with no cross walk signal.
One day, with a guide, we stopped and watched a bunch of drivers attempt, through sheer force, to convert a two-way street into a one-way street to accommodate the direction they were heading. Quite literally they all just turned into the two way street and took over both lanes in order to block the cars trying to head down the street toward them. The tour guide, an Egyptian who’s traveled a lot internationally, cursed his compatriots for ignoring most the basic rules of the road. And then he said wistfully, “The thing I love most about the U.S. is how cars pull over to the side when emergency vehicles flash their sirens.”
When I relayed these anecdotes to some locals, they affectionally referred to Cairo as “organized chaos,” a phrase that didn’t totally resonate. I found the chaos more energy-draining than energy-adding — especially as a pedestrian.
The legacy of the revolution. “There was no Egypt for the couple years after the revolution of 2011,” one local told me. By which he meant: laws were not really enforced. Uncertainty reigned. The uprisings — which gave rise to the broader Arab Spring — ejected an unelected despot but created a power vacuum then filled by the Muslim Brotherhood, who were subsequently overthrown in a coup by the military. During these years of tumult, the civic institutions of Egypt eroded. Smart people left. Tourism plunged. The country is trying to pull itself up and out of all this. It’s a work in progress. Those who have stayed are committed to defining the next chapter in Egypt’s history. They are the reason for hope.
Entrepreneurship ecosystem. Many smart people who feel powerless to change the politics of the country are turning to entrepreneurship instead. And many people who are simply lifelong entrepreneurs through and through are stepping up and beginning to organize themselves. There’s a nascent entrepreneurship ecosystem in Egypt led in large part by the remarkable Ahmed El Alfi, who’s renovated the Greek Campus to be a hotbed of startup activity in Cairo. He also launched the regional startup accelerator Flat6Labs. My good friend Chris Schroeder (who’s in the photo above with me) wrote a book that is the definitive account of 21st century middle east tech entrepreneurship — it features Alfi. On the flip side of most of what’s broken in the middle east lies an opportunity for an entrepreneur to build a solution. Opportunity is the flip side of frustration.
Interestingly, one entrepreneur we met with described his very impressive business as a “form of resistance” against the government. Resistance through capitalism; resistance through global trade. It’s quite moving to hear these sentiments and quite true, I think. Running his company is one of the best ways to shape Egypt’s future with the values that he believes in. This motivation does complicate a traditional business analysis of his company, though, since it’s not purely — or even primarily — being driven to maximize shareholder returns.
The word among Egyptian entrepreneurship ecosystem leaders is that what’s holding back the entrepreneurs is lack of capital. Money hasn’t caught up with the talent yet. Seems likely. Markets tend to be efficient…eventually. In Silicon Valley, where capital for startups is abundant, perhaps too abundant, we tend to forget just how special it is to have dozens of investors compete for the opportunity to invest in a startup. Growth markets like Egypt seem to be a couple institutional, mid to late stage investors away from an environment in which most of the credible local entrepreneurs can raise seed and early stage funding from local investors (and get terms that are ever more founder friendly). Will these investors be funding billion dollar Silicon Valley style unicorns? Not for awhile, but that’s not the only way to generate great venture returns — and it’s certainly not the only model for building a great business.
One small but interesting regional dynamic: Given the overall volatility in the middle east, Dubai has emerged as a regional hub that attracts the most international talent and capital. More than one Egyptian entrepreneur prefaced a conversation with me in Cairo by saying, “I haven’t moved to Dubai because…” Where the best local talent ends up will determine which ecosystems thrive.
I didn’t spend enough time in Egypt to make any meaningful conclusions about what’s happening there economically (and certainly politically). But the shift of geo-political power from west to east, the rise of a global middle class empowered by technology, the faster spread of innovation through interconnected populations — these are some of the central stories of our lifetime. Egypt will be part of this story. American investors like Dave McClure recognize this macro trend and are putting their money where their mouths are. More from Silicon Valley will follow. Why? Because entrepreneurial people chase opportunity even when there’s risk — perhaps especially when there’s risk. And the next great opportunity is on the frontier, where billions of people are coming online with smartphones…
Pyramids. As Richard Nixon might have said, the Great Pyramid of Giza is a very great pyramid indeed. So amazing to see the scale up close and personal. It’s a short drive from Cairo and it’s a great time to visit because of the lack of tourists.
Embassy areas that feel like war zones. It’s eerie to walk around the row of embassies in Cairo, including the streets around the U.S. Embassy. It’s quiet because armed soldiers walk around on blocked off streets. Ginormous blocks of concrete stack up along the roads. Our tour guide reminisced that when he was a kid growing up in Cairo he would go over to the American embassy on the weekends and watch movies in the grass yard inside the courtyard, right under the American flag. American kids would pass out candy. Today, you can hardly see the flag from the outside, obscured as it is by the concrete and barbed wire. Our guide asked wistfully, “What has happened to the world?”
Selfies for everyone. A striking moment in the gate area flying from Dubai to Cairo: A woman fully veiled in a burqa making multiple attempts at the perfect selfie.
Trump in the Muslim world. Muslims are listening to Donald Trump’s bigoted proposals. The damage to the American idea is incalculable.