Against all odds: inside Gaza’s first start-up accelerator

We meet a growing band of young Gazan entrepreneurs, intent on forging careers, scaling businesses, and bringing jobs to an impoverished local market

Hadeel El Safadi thinks big. At 24, the founder of digital animation start-up Newtoon has grand plans to grow her nascent business into a regional behemoth – if she could just secure the funding. “My biggest dream is for my company to go from being a start-up, to being the largest producer of animation in the Middle East,” she says. “We need support and investment to scale beyond the local market.”

El Safadi is in good company. From Cairo to Amman, the Arab world’s startup scene is abuzz, fired by tens of thousands of fresh-faced hopefuls seeking to capitalise on the Middle East’s changing business culture and put their ideas into action. Less typical, however, is El Safadi’s location. Newtoon is based out of Gaza, a sliver of land more commonly associated with strife than start-ups, and home to one of the world’s deepest-running geopolitical conflicts. Even more remarkable, is that she is one of a growing band of young Gazan entrepreneurs, all intent on defying gloomy economic odds to forge careers, scale businesses, and bring jobs to an impoverished local market.

“This is something Gaza has never seen before and young people are hungry for it,” says Iliana Montauk. “They want to show that even in one of the most conflict-ridden parts of the Middle East, there is opportunity.”

Montauk works for a group called Gaza Sky Geeks, the first start-up accelerator in the Gaza Strip. Created in 2011 by Mercy Corps, a global aid agency, with a $900,000 grant from Google, it has helped trigger a leap in entrepreneurial enthusiasm. In a city strewn with rubble, where power blackouts are a daily event and where GNI per capita is just $1,665, Gaza Sky Geeks offers advice, free office space and investment exposure to dozens of fledgling local ventures. Its pipeline includes Gaza’s answer to Uber, a ride-sharing app called Wasselni that hails taxis and private cars; Datrios, a social network for Arabic sports fans; and DWBI Solutions, a fix for big data management in governments or large companies. Half of start-ups under its wing are headed by women.

“There are no jobs. Even for the most talented graduates, there are few opportunities” “Our aim is to give start-ups in Gaza the means to succeed,” says Montauk, one of three staff members at Sky Geeks. “Our goal in the next three to five years is to see a start-up secure follow-on investment, and to start providing jobs. In 10 or 20 years from now, Gaza could be a tech hub.”

For local youth, this might be a tipping point. Gaza’s economy is broken, bowed by three Israeli offensives in five years and an eight-year economic siege that bars people, goods and crucial reconstruction materials from entering – and Gazans from leaving. The blockade has all but extinguished the prospects of the younger generation, helping to foster sky-high youth joblessness. More than half of young men are unemployed, according to the UN’s International Labour Organisation. Among women aged 15 to 24, the rate soars to 86.3 per cent.

“There are no jobs,” says Said Hassan, an entrepreneur who also serves as outreach and acceleration manager for Sky Geeks. “Even for the most talented graduates, there are few opportunities.”

Born and raised in Gaza, Hassan earned his stripes in Egypt with the former start-up Souq.com, now one of the biggest e-commerce players in the Middle East. When his mother fell sick, he returned home to support his family. He recalls seeing the best and brightest of his friends relegated to taking menial, part-time jobs in an attempt to generate an income. “I thought I would never work with something like Souq again,” he says. “I thought in Gaza I would be lucky to find any job.”

In June 2014, he launched his own start-up, a second-screen social network built around television shows called Tevy. To date, with Sky Geeks’ backing, it has secured $30,000 in early funding. “There is so much potential, here,” says Hassan. “We’re shaping Palestine’s future.”

Tevy is not the only win. In the four years since its launch, Sky Geeks has run more than 100 events in Gaza, reaching over 1,500 individuals and banging the drum for entrepreneurship. In 2011, some 300 people applied to attend its first Start-up Weekend for a rare chance to mingle with international mentors and venture capitalists. Applications for the June 2014 event, held to a soundtrack of rocket fire and airstrikes, topped 600.

Four of its start-ups have netted investments from regional players, such as Jordan’s Oasis500 and Palestine’s Palinno, ranging in size from $15,000 to $20,000. Sky Geeks has also funded overseas trips for its start-ups – to an incubator in Jordan and an event in Egypt – and hopes to send teams to Silicon Valley later this year.

Closer to home, it has inked a deal with recruitment giant Bayt.com to gift salaries and mentorship to two start-ups, freeing them up to focus full-time on getting their ideas off the ground, while gaining real-world work experience. “There’s a level of success now that didn’t previously exist, and it’s inspiring more people to want to participate,” says Montauk.

Bridging the gap between start-ups and the outside world through travel and access to experts is critical to ramping up this success, she says. Most aspiring entrepreneurs in Gaza have never left the strip. “The main barrier they face isn’t conflict, it’s a lack of connection to the wider world,” she explains. “When our start-ups were in Jordan, they were surprised to learn there was electricity available there the whole time.”

The contrast between Gaza and other digital hubs around the world is stark. Yet the tiny territory boasts one of the highest tertiary education rates in the Arab world, and a surprisingly robust tech infrastructure. Amid the Israeli bombing campaign of last summer, which obliterated whole districts, Gaza’s internet held steady.

“People want to see new solutions in Gaza, and they believe in the potential of entrepreneurship”Launch costs are also low: local developers earn around $400 a month, compared to $100,000 a year in Silicon Valley, so a $20,000 seed investment goes a long way. For savvy young Gazans, web-based start-ups offer a way to pierce the blockade and take part in an economy that transcends borders. For Sky Geeks, they are vital to its efforts to redraw Gaza’s image abroad, and flip its narrative from that of a war-torn ghetto, to one of a humming entrepreneurial hub.

“We want to show it’s possible to create a successful and vibrant tech sector in a frontier market,” says Montauk. “We want to lead that charge.”

Business in Gaza is not for the timid. Added to the usual risks inherent in hatching a new venture is intermittent electricity, the threat of conflict and the brutal isolation of daily life under siege. Entrepreneurs are nothing if not tenacious. One, recalls Montauk, pitched coolly to US investors as bombs exploded nearby. “They are desperate to contribute to the world in positive ways, and show Gaza has more to offer,” she says.

Sky Geeks ran aground in mid-2014 when its funding dried up. While Mercy Corps dug deep to keep the accelerator afloat, Sky Geeks turned to the crowd in a bid to keep its lights on. The response was electric: from a first goal of $70,000, the #GazaStarts campaign drummed up more than $267,000 in donations, capturing dollars from 60 countries and territories. Nearly half of funds came from the US. According to Sky Geeks, it is the biggest crowdfunding campaign the Arab world has seen.

“There is a grassroots desire for this to succeed, from around the world,” says Montauk. “People want to see new solutions in Gaza, and they believe in the potential of entrepreneurship.”

The next goal is to raise $1.5m, giving Sky Geeks a runway of three years. To do so, the accelerator is calling for backing from regional blue chips and philanthropists – “people with skin in the game”, Montauk says – keen to ignite change in one of the Middle East’s most embattled neighbourhoods. It is no exaggeration to say the future of potentially hundreds of young Gazans hangs on whether they answer.

“Sky Geeks is the reason for me to smile and have hope every day,” says Nalan al-Sarrah, an entrepreneur who has also helped with the group’s marketing push. “I swear this place is magical.”

Photo credit: Magic Lens