Home Grown Apps in Middle East are Exploding. What’s Causing This Boom?

Partner Post - Promatics Mobile App Development Services

Posted: September 18, 2017

When people think of Middle-East, oil and the challenging geopolitics are the first two things that come to people’s mind. Very little is known about the startup ecosystem existing in Middle East region or the digital footprint of the people staying there. However, the truth is a handful of countries have moved beyond the oil economy and have invested in alternative industries and sources of revenue.

There are around 23 Arab states in the Middle-East region. Though there is some political unrest in these countries due to various reasons, these Arab states have an upcoming tech industry that deserves world’s attention. The acquisition of Souq.com, a largest online retailer of Middle East by Amazon.com made global news and attracted world’s attention towards less known digital business sector of the Middle East.

Middle-East mobile app development scene–huge possibilities for growth

Some of the brightest minds of the Middle-East are turning innovative technologies into exciting business models. Across Middle-East many young men and women have created new companies and technology startups that replicate startup scenes in the Western countries. These new millennial tech entrepreneurs are boon to Middle East economies that suffer from high unemployment and slow growth due to their dependence on depleting oil reserves and falling crude oil prices.

For busy millennials, mobile apps are life savers. They depend on apps for a host of things such as booking a cab, tracking location ordering food, and what not. And for markets like Dubai or other Arab countries where convenience matters most, mobile apps are selling like hot cakes.

Young entrepreneurs of Middle East countries like Dubai have a deep liking for mobile apps. The demand for mobile apps amongst the tech savvy millennials in Dubai and neighboring countries is insatiable and it is fueling the growth of mobile app start-ups.

Despite tough economic environment and stringent government regulations, the mobile app startups are able to raise funds. Majority of the funding comes from angel investors, corporate venture arms, and venture firms. Numerous Middle-East tech start-ups like Fetchr!, Souq, Careem, and ReserveOut have already shown early signs of success and many more are making a strong presence in the market. Some of them are

  • Washmen – on-demand laundry service provider
  • InstaShop – grocery delivery app
  • Eat Easily, Talabat, and Food on Click – food delivery platforms

As many mobile app development companies have not entered the Middle-East market yet, there is a good scope to take over the mobile app market.

Popular Apps in Middle East

Why is mobile east app-scene exploding in Middle-East? 

With the dip in oil prices in last few years, the member countries of GCC (Gulf Cooperation Council) have diversified their economy by supporting the growth of IT sector and technological innovations. The increased use of smartphones, availability of high-speed Internet has made apps a necessity and not a luxury.

Today a lot of millennial entrepreneurs in countries like Dubai have initiated tech start-ups to access the emerging markets with considerable support from governments, semi-government institutions representing various sectors like renewable energy, health, and education. This push has made people from Middle-east more dependent on mobile apps and almost every tech startup coming up in this regions aims to develop a mobile app that can fill the gap that exists in the market.

For career-minded and busy individuals, mobile apps allow users to multitask efficiently with minimal effort and also save valuable time. The race to build tomorrow’s coveted mobile app has already begun in the Middle-east and as time passes you will see significant developments in the mobile app arena targeted towards users in Middle-East countries.

Here are some mobile apps startups in Dubai and UAE that you need to watch for which have the capacity of disrupting industries.

Bridg

It is a mobile payment platform that facilitates payment through Bluetooth technology. It marked introduced Dubai citizens to the world of mobile banking where they were not required to connect to the network to facilitate payments. The start-up recognized the gap where it found low-income groups were not connected to the network at all times and hence stayed away from mobile banking. The Bridg app uses Bluetooth technology to make payments using the app. In short period, the Bridg app has become an alternative to traditional banking in Dubai.

Morni 

It is an interactive platform offering on-road assistance in Saudi Arabia. The app is available for iOS and Android platforms. Founded in 2014, the startup has received $1 million funding. The app is totally free to use and useful to get timely help to get the problem fixed while traveling. With Morni app in their smartphone, drivers need not worry about breakdowns.

HelloFood

The online mobile app startup allows you to order food from different restaurants including Burger King, KFC, Taco Hut, Quiznos, Canton, Amo Hamza, and Hardees. The app serves several cities of Saudi Arabia such as Mecca, Riyadh, Dhahran, Madinah and many more.

Despite more than 50+ successful start-ups in Middle-East, there are few shortcomings that might hamper the growth of mobile app start-ups in the region.

Challenges for startup ecosystem in Middle-East

While young entrepreneurs in Middle-east have started disrupting traditional markets with their innovative ideas, they still face a stiff resistance from traditionalists. The main challenge faced by mobile app startups is raising capital or funding due to various reasons.

New realm of technology entrepreneurship 

The history of business in the region has a strong impact on its economy. The Middle East economy was driven by traders and merchants and the whole technology entrepreneurship realm is new for people and investors here. The policy makers need to understand the needs of mobile app startups and engage the stakeholders to build a strong startup ecosystem for everyone.  App developers are far and few however a strong outsourcing ecosystem to tech rich countries like India is building up fast.

Lack of information

The lack of information is the primary reason behind the fear of investing. The real problems are lack of information about startups in the region and doubt of the legitimacy of the project that discourages investors. Also, startups success is not predictable and the policy makers need to encourage investors to take risks to allow tech entrepreneurs to build products that make our world better.

Challenges for startup ecosystem in Middle-East

Complicated financial systems

High cost, fragmentation, and complexity of financial systems make things difficult for mobile app startup entrepreneurs. The usage of credit cards is still low and it is a costly, difficult and complicated process to setup and send payments which is a recurring setback for most tech startups.

Immature attitude towards tech startups

The Arab world lacks highly experienced investors who are true visionaries. The Middle-East has never been home to disruptive technologies. If you are building something that never existed in the Arab world, it is difficult to convince investors to invest in your startup. The market is lagging in terms of technology and it is certainly not a place of early adoption.

Areas where mobile app development has large scope

Transport and Logistics

Freight and logistics companies have a greater role to play in the business world. They move a lot of things from one place to another and mobile apps can make their operation easier. Companies like Fetchr!, Wing and InstaShop have already created their mark in the freight and logistics industry but still, there are a lot of opportunities that can be tapped by innovative mobile app ideas.

M-commerce and E-commerce

The E-commerce and M-commerce sector is fast catching up. E-commerce sites like Souq.com and Dubizzle.com are already leading the online retail race in UAE, Saudi Arabia, and Egypt.With features like a wide range of products including apparel to electronics, easy returns, and cash on delivery, e-commerce is a booming sector in Saudi Arabia and UAE and it is expected to grow faster in next few years.

The MENA Startup Ecosystem- boosting startups ecosystem in the Middle East and North Africa

The MENA Startup Ecosystem is based on the theme on how corporates can support startups better. According to MAGNiTT report, the MENA startup ecosystem has shown signs of maturity and closer to reaching the cusp of $1 billion funding for start-ups. The year of 2016 witnessed the largest amount of investment for start-ups which was equivalent to $870m+, a 424% increase from last year.The result is startups in the region are flourishing. The Middle East startup ecosystem is also witnessing interest of International investors eager to tap the flourishing mobile app and tech startups in the Middle East.

Wrapping up

The idea behind presenting this information on mobile app startup ecosystem is to drive home the point that smartphones are being used comprehensively in Middle Eastern countries. The United Arab Emirates and Saudi Arabia might become the Silicon Valley of Middle East and you will witness the number of mobile apps startups increase in near future. As a professional app development company Promatics Technologies has been helping a lot of entrepreneurs in Middle East build and launch apps. Are you to looking forward to turn your app into reality?

Contact Promatics today and see your app dreams come to life.