The AUC Venture Lab at the School of Business celebrated the graduation of the 11th cycle of the Startup Acceleration Program and the fifth cycle of the FinTech Acceleration Program.

"This Demo Day, we graduate a new cycle of innovative and impactful startups that contribute to different industries in our ecosystem, including energy, education, e-commerce, health care and fintech," said Ayman Ismail, Abdul Latif Jameel Endowed Chair of Entrepreneurship and AUC Venture Lab director. "As AUC V-Lab moves past its five-year marker, we continue to celebrate dedicated work and creative business ideas to support the growing impact of entrepreneurial mindsets.”

As Egypt’s first University-based accelerator, AUC Venture Lab provides acceleration services to startups, leveraging AUC’s intellectual capital, world-class facilities and research capacities. It connects entrepreneurs with a wide network of alumni, faculty, mentors and investors. Over five years, AUC V-Lab has graduated more than 120 startups.

Through its Startup Accelerator, AUC V-Lab offers a 16-week program providing business support for innovative startups to grow their business and boost the Egyptian economy.

AUC V-Lab also houses the FinTech Accelerator, which offers a 16-week customized program for FinTech startups providing entrepreneurs with specialized business finance and technology support, where startups gain valuable insights from some of the smartest minds in the startup and fintech worlds.

Startup Acceleration Program

Health Care

The Startup Accelerator cycle incubated startups across a myriad of sectors. Focusing on health care, CDOC is a medical consultation app for patients to connect, chat and consult with physicians. The service is provided by specialized doctors who are legally registered at the Egyptian Medical Syndicate in different specialties.

There is also MoDo, a local healthcare directory with more than 44,000 service providers, which enables users to locate the best nearest service provider. It gives them the option to filter providers using insurance network, as well as rate the service and share their experiences in just a few clicks.

Also incubated in this cycle is Instadiet, a web and mobile app that connects users with certified dietitians to address diet challenges. It allows dietitians to maximize their patient capacity while offering patients a hassle-free journey as they can select their dietician, receive tailored meal plans and track their progress, all online. 

“AUC V-Lab added value to my startup in two key areas," said Ahmed Tawfik, founder of Instadiet. "First, they introduced me to their network of partners and mentors who helped me close B2B deals that I hadn’t considered before. Second, they introduced me to a network of high-caliber fellow founders with a complementary set of skills that helped push my startup even further."

Sustainability 

The cycle also hosts Bio Life, provider of an affordable alternative source of energy for sustainable rural development, as it offers a biogas digester that is easily installed at homes and is both cost- and energy-efficient.

Fintech Acceleration Program

Facilitating Procedures

As for the FinTech Acceleration Program, it incubated Gigaaa, an intelligent personal assistant platform that provides users access to all range of products and services through voice command and automatically processes user payments through the Gigaaa wallet while continuously gathering data through machine learning for a more personalized experience.

To ease the routine and red tape, Egr2atk offers a platform to connect individuals with licensed offices to issue governmental documents, to minimize time and effort for users while increasing the capacity of licensed governmental offices. “Being part of the AUC Venture Lab for such a small time helped me build a stronger network as well as discover new opportunities I did not know were available," said Ayman Mostafa, founder of Egr2atk. "Also, I am now equipped with strong tools that will enable me to move forward with my business."

Other startups are FINSOFT SWITCH, a middleware between banks' host and offline delivery channels (POS, E-Commerce and MPOS) supporting banks' payment gateway system and XPay, a digital platform facilitating cashless payments within communities. Through its secure portal and app, XPay works to swiftly manage payments and financial transactions ruling out weak financial controls and time consuming cash-based operations.

Mohamed Abdelmottaleb, co-founder of X Pay, said: “One clear value we gained from the Venture Lab is that we’ve learnt how to challenge our business model and our impact model. We have also been introduced to a good selection of mentors.” 

Egypt has moved from being in a “crisis zone” only two years ago to an “investor haven” now, according to Bloomberg.

Tarek Selim ’92, ’95, economics professor and most recently a research fellow in emerging markets at the Massachusetts Institute of Technology, explains why the Egyptian economy is on the rise and what it can do to continue to improve.

What exactly does “floatation” mean?

In economic terms, the recent floatation of the Egyptian pound is called a "shock," which implies the economy takes several years to absorb it. Historically in similar countries, it takes up to five to seven years to fully absorb such a shock. The first three years after the shock are the most critical, and the next few years tend to be minor. Egypt’s economy has almost passed three of the critical years with inflationary pressures on the quality of life.

The floatation of the pound has been costly to the average citizen in terms of inflation. The wage rate did not increase in proportion to the increase in prices. This caused a decline in the quality of life and the people’s purchasing power of goods and services, which is a critical challenge moving forward.

Why did the Central Bank of Egypt (CBE) choose to float the Egyptian pound?

The floatation policy basically creates an incentive to export because the currency becomes cheaper relative to other currencies abroad. For example, suppose Egypt is producing a product costing EGP 100. If the exchange rate is $1 to EGP 1 and Egypt exports the product, then it will cost $100 to the receiver abroad. However, when the exchange rate changes dramatically to EGP 10 per dollar, the value of the same EGP 100 decreases to $10, so it should be cheaper to export. One of the major benefits after the flotation of the pound is export potential, and this is not yet realized. But I am optimistic. However, the potential to increase exports for Egypt has many constraints, including scale, infrastructure, and bureaucracy.

What if the CBE had not decided to float the Egyptian pound?

The country’s reserves would have been depleted fast, rather than increasing the way they are right now. Egypt doesn't have the resources to sustain such a depletion, so I think the “shock” was needed. However, complementary policies should have been put into place to make sure that quality of life was not affected in a very drastic way. This includes wage adjustments, anti-monopoly policies, scale incentives, and less bureaucracy. Right now, this should be one of the government’s priorities.

Can you explain why the floatation of the Egyptian pound put Egypt in a “crisis zone?”

The Egyptian economy has gone through a lot in the past couple of years. Especially after the revolution — all the turbulence, all the uncertainty. Uncertainty is a risk factor, especially for international investors who are looking for emerging markets. Countries are competing in the world market, quite similar to companies in domestic markets, hence a competitive advantage for Egypt must be strategized. The local market is the global market now.

Why do you think Egypt is becoming an “investor haven?”

The term “investor haven” might be an over-statement. If I'm an investor and I consider my options, the first thing I look for is the rate of return — which is the yield. Egypt has one of the highest yields on consumption-driven investments due to its market size. Also, Egypt’s yield on certificates on investment, which are considered a safe investment, is around 18 percent. The second thing is the risk factor. Egypt’s risk ratings have been improving, and the currency risk factor has been stable. The exchange rate has been stabilized over the past year, contrary to expectations. In the past one or two years, a lot of people expected the currency to devalue and continue to devalue. I think now it has stabilized, but there is a risk of such stabilization not to be maintained. Although there has been a stable political environment, yet an improvement in the economic returns of critical sectors, such as tourism and the Suez canal, in addition to a needed surge in manufacturing scale exports, are of high importance. Natural gas is helping the economy move forward, which is very good but not sufficient in the long run.

What can Egypt do to keep improving investor confidence?

Egypt has a lot of natural resources in addition to energy, like cement, marble, granite, aluminum and fertilizers. There are a lot of industries that could actually flourish and expand into the international market, and I think this should be our next step economically. It's not really the number or amount of investments alone; it’s the quality of investments that we should focus on. Egypt is in need of labor-intensive investments –– investments that absorb a lot of labor. When investments absorb more labor, this solves the unemployment problem. Also, local innovation is needed, such as in digital manufacturing. In the latest World Economic Forum’s Global Competitiveness Index, Egypt has jumped 15 ranks upwards, yet its level is still low at 100th place out of around 140 countries. Egypt can do better. There is huge, yet unrealized, potential. Quality of the labor force, government bureaucracy, education-work matching, and huge public debt are major challenges to improve the country’s competitiveness.

Are there any additional factors that make Egypt an investor haven?

Egypt is a consumption-driven economy, and local investors tend to be family businesses. That's why the sectors that are low-risk and high-return tend to be food, clothing and real estate. In Egypt, 90 percent of our income is spent, when the world average is around 77 percent. This, by itself, is an indicator to attract investments in certain sectors. Social economic behavior has consumption ripple effects. Once you start investments in Egypt, the supply in your investments will be enough to attract as much demand as possible. What is needed is local innovation, better governance, scale enhancement for export-led investments, and successful Egyptian brand penetration into the world market.

Is it likely that Egypt will stay an investor haven?  

Egypt has huge but unrealized potential, and we need to plan for realizing such potential. Having investments is important, but not sufficient. We need to complement it with other things — labor-intensiveness, local innovation, human capital mapping, technology transfers, competitiveness and bold strategies to enhance the overall efficiency for each of the different sectors. Policies play an important role. In the past, the priority was more on the infrastructure, physical capital and mega projects. Now, the focus should be on human capital and quality and scale of investments, which I think is the right shift of policy that will result in long-term economic success.

The AUC Venture Lab, Egypt’s first University-based startup incubator and accelerator, recently celebrated its fifth anniversary. During those five years, the V-Lab incubated 115 startups that generated EGP 88 million in revenues, raised more than EGP 220 million in investments and created more than 500 new jobs. V-Lab was also recognized as a top university business incubator in Africa and high-impact incubator in the Middle East and North Africa region by UBI-Global.

“AUC Venture Lab had a distinctive impact on Egypt’s entrepreneurial ecosystem,” said Ayman Ismail ’95, ’97, director of the AUC V-Lab and the Abdul Latif Jameel Endowed Chair in Entrepreneurship. “[This impact is] not only by supporting innovative, high-growth startups, but also by connecting them with AUC’s educational mission through experiential learning, where students and entrepreneurs work together and collaborate to create value for the startups.”

Since its launch in 2013, AUC Venture Lab has provided more than 1,500 hours of mentoring and training to its entrepreneurs. These V-Lab graduates, driven by creativity and determination, went on to provide life-changing services and experiences, contributing to facilitating lives across Egypt and the region.

Since its founding, the AUC Ventura Lab Startup Accelerator was supported by several corporate partners, including the Arab African International Bank (AAIB), a corporate leadership co-founder, as well as SODIC, Shell and General Electric. “The collaboration between AAIB and AUC Venture Lab marks a unique alignment between financial and academic institutions for the interest of entrepreneurs,” said Hassan Abdalla, chief executive officer of the AAIB. “As a main driver in the Egyptian economic scene, the financial sector must play a role in empowering the entrepreneurship ecosystem in the country.”

FinTech Future

People are constantly trying to find ways to better manage their money and time, and financial technology (FinTech) is helping the world move in that direction, with the AUC V-Lab becoming a regional and local hub for this transformation. In Fall 2016, V-Lab launched the AUC Venture Lab FinTech Accelerator in partnership with the Commercial International Bank (CIB). Since then, the V-Lab FinTech Accelerator has graduated 18 FinTech startups, contributing to the growth of the FinTech ecosystem in Egypt.

With the FinTech field growing in Egypt, both financial and non-financial institutions are becoming more open to these innovations, and entrepreneurs are finding more ways to stand out when they enter the world of FinTech. Q-Less, founded by AUC student Walid Wael Abou ElNour, Saeed Talaat ’16, Hashim Ibrahim ’16 and Youssef Galal, is a startup that’s out to tackle one of the country’s most frustrating experiences: being in queues and hoping to not waste your day while trying to make a payment. Q-Less is an online platform built on a system that facilitates transactions between customers and service providers. It allows customers to make everyday payments, renew subscriptions and pay tuition without having to stand in endless queues.

Abou ElNour, finance and accounting major at AUC and financial analyst of Q-Less, said that the startup joined the AUC Venture Lab at a mature stage, with a developed prototype and business model. Nonetheless, the lab played the role of a mentor and supporter. “The V-Lab was more of validation,” Abou ElNour explained. “We had access to different mentors with high expertise in their fields who were able either to validate and support what we did or guide us to more efficient and profitable alternatives,” he said. “Both were beneficial for all of us. They greatly expanded our knowledge and understanding.”

The process of entering the V-Lab takes startups through several stages. It starts with applications, screening, mentoring and judging, then it becomes serious business, where startups go through the acceleration process, where they receive intensive training. Then on Demo Day, startups are presented, and finally, there is incubation, where startups are granted an extended amount of time to use the V-Lab’s services.

“It gave us more trust in our startup,” said Abou ElNour. “As entrepreneurs, we are always on a ride in an emotional rollercoaster of doubts, hope, success and failure. However, having your idea mentored and supported by people with very high expertise, knowledge and impact in the entrepreneurship field at the V-Lab gave us a boost and assurance that we are on the right track.”

Startups Serving Society

Swvl

Startups who graduate from the V-Lab all have one thing in common: serving different communities and sects of societies. One of them is Egypt’s most recent and useful transportation options: Swvl – a mobile app that organizes convenient transportation routes around Egypt at reasonable prices. Co-founding CEO Mostafa Kandil ’15 and his team are alumni of the AUC Venture Lab. Today, Swvl has raised $8 million in its first round of venture capital financing, which is the largest round of funding for a tech startup in Egypt and one of the largest in the Middle East.

“V-Lab was instrumental in Swvl's early days,” Kandil affirmed. “The team's mentorship and constant feedback on how to take Swvl from zero to one was key in how we shaped our marketing, operations and other key functions. Being a V-Lab graduate was a stamp of confidence when we started fundraising.”

With its entrepreneurial support and the knowledge and guidance of mentors, the team was able to launch the application before graduating from the cycle. Kandil confirms that Swvl is on a mission to create 5,000 micro-entrepreneurs who own their vehicles to make a better living.

“What we’re doing is building public transportation for emerging markets,” said Kandil. “Often, people outside of emerging markets don’t understand the magnitude of this global issue. In these markets, the middle class doesn’t have affordable ways to commute. We’re going to these markets and building the infrastructure for them.”

La Reina

Many may have seen ads around Facebook about wearing their favorite designers’ sartorial masterpieces at an affordable price — it’s the unique V-Lab graduate, La Reina, founded by Ghada ElTanawy and Amr Diab. La Reina, which is based in a platform that allows customers to rent formal gowns, recently raised $1 million in a first round of investment from Algebra Ventures and 500 Startups.

La Reina’s service is targeted at women, with 75 percent of the team behind it being women. The couture service allows customers to rent gowns according to their occasion — whether it’s a formal evening or their wedding. In return, it allows others to make use of gowns that were bought and worn once, but are in great condition ready to be reused.

In the two years since its launch, La Reina brought in more than EGP 3.5 million in total for gown owners. “The AUC V-Lab was my first window to the startup ecosystem,” said ElTanawy. “After I joined, I was mentored by many entrepreneurs and got to know them, and they who helped me in my journey. They encouraged me to apply in competitions, one of which was RiseUp Explorer, where we were named one of six most promising startups in the Middle East and went to Silicon Valley.”

With a growing team of talented and determined individuals, La Reina is looking forward to creating a “humble boost for the local economy,” through increasing the number of items to 5,000. This will result in an increased revenue — up to 8 million for dress owners — as well as expansion to the regional market.

ElTanawy noted that V-Lab has been there every step of the way, and she expects it to always be there for support as her business grows. “The AUC V- Lab was a supporting partner all the way,” she explained. “I have always reached them for advice, and the mentors are mentors for life — not for a three-month cycle.”

She added, “When I am faced with challenges or different opportunities and I need guidance, I always reach out to them — specifically Professor Ayman Ismail. They follow up with me along the way and warn me if I have a blind spot in my business. I advise future entrepreneurs to get the most out the AUC V-Lab because it really can change your life. Consider them family because they are willing to go above and beyond for your success.”

From apps for student life, course registration, grades and sports tournaments to the creation of blended learning spaces combining in-class seminars with online resources, AUC’s new Office of Information Management, headed by Sherif Kamel, management professor and former founding dean of the School of Business, aims to bring together people and technology in innovative ways that reflect the continuous and changing academic needs in today’s digital world.

“There’s a growing trend toward on-the-go apps, and AUC should be there,” affirmed Kamel. “There are a variety of emerging learning tools and applications, and not all of them are web-based platforms. [In fact], the web is seen as the classical approach, not the most innovative and creative anymore.”

Interactivity and collaborative technologies are the way forward, Kamel noted. “I want to see more interactive communication and more apps offering a variety of services,” he said. “Some can be directly related to the learning experience, and some can be related to services and community life on campus.”

Laying the Groundwork

During this first year, Kamel will be primarily focused on conducting an overall assessment of the technology space at AUC. “This is a collective effort and should lead to the development of a strategy for information management for the next three to five years –– where we are, where we are heading and how to get there,” he said, adding that the office will always amend its strategy based on emerging and changing needs. “But we need to have something that is integrated and complements the AUC strategy,” he emphasized.   

The initial step in developing a strategy is gathering feedback from the community. “It is always important to first understand the environment by talking to different stakeholders, including students, faculty, staff and alumni, and getting their views and thoughts,” said Kamel. “We need to know what issues and challenges they’re facing. It is a community effort, and engaging different stakeholders will help bridge whatever gaps exist between what people have and what they are looking for.”

Kamel added that, as former dean of the School of Business, he had regular discussions with faculty, staff and students to understand their concerns, listen to their ideas and explore ways to improve the school. 

“I see this happening again in my new position,” said Kamel, who also met with student leaders on campus to listen to their ideas and needs.“Just a couple of days after I took on my new responsibility, I was approached by a group of students who proposed to me an app for navigating the campus. They even had an initial version built. It’s s a great suggestion and is just one example of how we hope to facilitate services offered through technology.”  

Embedded Blended Learning

A key component of Kamel’s vision for the office is revisiting technology utilization on campus, specifically, how technology is embedded in the learning experience. “It’s one thing to update the technology infrastructure and train students, faculty and staff to use it,” Kamel said,“but how are we actually embedding technology in the whole cycle?”  

A major trend in higher education, according to Kamel, is the creation of blending learning spaces. “Blended learning is the mixture of in-class seminars with online resources and webinars,” he explained. “With that combination, we can render the learning experience much more effective because after 20 years of web and online platforms, there is a huge knowledge depository out there. It’s definitely one of the things we’ll be looking at.”  

With this forward-looking vision, Kamel is exploring the different venues where existing technology on campus can be improved. This includes identifying avenues for the community to access campus services through various technology devices, expanding the way students and faculty members use technology in the classroom and offering staff members the opportunity to capitalize on the use of technology in their administrative and managerial responsibilities.

Campus Collaboration  

To accomplish all these goals, Kamel emphasized the importance of campus collaboration. A significant amount of technology infrastructure at AUC already exists, but Kamel sees an opportunity to work with different stakeholders to identify how the available resources can best benefit the University community. The office will be working with the information technology infrastructure at large and University library –– utilizing its technology tools, applications and emerging digital platforms–– to investigate the role of technology and innovative methods in the learning process, as well as explore different venues for information creation, dissemination and knowledge sharing for the AUC community. The office will also work with the academic schools, Center for Learning and Teaching, as well as the various research centers on campus.

“Coordination and collaboration will render the operation more efficient and avoid redundancy or duplication,” Kamel explained. “We should collectively be looking at how to best serve the AUC community, whether on or off campus, through technology platforms, tools and applications to meet the University’s mission.”  

For Kamel, the creation of the office is only the first step forward in a continuous effort to develop new initiatives. “I personally believe in continuous improvement and that such a process is a journey and never a destination,” he said. “This is a collective effort, and I look forward to working with different stakeholders to continuously improve students’ learning experiences, where technology is absolutely invaluable and a critical element in the learning process. With the support of the intellectual human capital on campus and with the proper and collective efforts of all, we will regularly improve the learning environment, reflecting what the different constituents want to be able to realize the positive impact on society we all desire.”

Even as Kamel discusses the technological aspects of his new position, he makes a point to never lose sight of where technology comes from and who it is for. “The most important element and building block in that space is the people; they make all the difference,” he said.