Endeavor Saudi Arabia and Strategy& Middle East host joint event to unleash KSA scale-ups potential

Wednesday 03 April 2019
Riyadh - MENA Herald:

Endeavor Saudi Arabia and Strategy&, part of the PwC network, held a joint event on the challenges of scaling up small and medium-sized enterprises (SMEs) in the Middle East and North Africa (MENA) region. With a particular emphasis on Saudi Arabia, discussions at the event centered on how to enrich the Kingdom’s entrepreneurial ecosystem to accelerate economic growth.

In a recent study, Strategy& and Endeavor assessed the state of the region’s scale-ups—SMEs with a proven business model that are poised for exponential growth—and found that governments have a huge opportunity to make a significant economic impact if they give the scale-ups segment the focus it needs.

Musaab AlMuhaidib, Endeavor Board Chairman, welcomed guests by saying: “As Saudi Arabia undergoes an unprecedented period of growth and transformation, there has never been a more important time for us to come together and spark a national dialogue on the importance of scale-ups to the economy. Focusing on this distinct segment will not only create a more vibrant eco-system, but also significantly drive economic growth.”

The event started with a presentation delivered by Mahmoud Makki, Partner with Strategy& Middle East, on the challenges involved in scaling up and what initiatives the Saudi government is currently undertaking in this area.

Makki said: “Saudi Arabia’s leadership is effectively pursuing a number of reforms and initiatives that benefit scale-ups and catalyze the entire entrepreneurship ecosystem. However, scale-ups across the Kingdom and wider region still face a number of challenges, mostly related to funding, talent, and access to customers. Successful scale-ups in KSA generated on average 8 times more revenues and 20 times more jobs than SMEs, so it is an extremely important segment that we cannot overlook.”

The presentation was followed by a panel discussion moderated by Lateefa Alwaalan, Managing Director of Endeavor Saudi Arabia featuring Abdul Aziz Al Omran, Chairman of Impact 46 and founding board member of Endeavor Saudi Arabia; Loai Naseem, Founder & CEO of Lomar; Abdulaziz AlJouf, Founder & CEO of Paytabs; and Noor Alabdulkarim, General Manager of Strategic Initiatives and partnerships at the Social Development Bank.

The panel discussed the main external challenges facing scale-ups, including the difficulties in accessing talent because of competition from the public sector and increasingly expensive expats; accessing growth finance (as opposed to seed funding); and accessing customers, particularly large public sector buyers.

They also outlined the key areas that should be focused on to address these challenges and support the scale-ups ecosystem such as promoting career opportunities with scale-ups that target leading executives and students, as well as digital training programs in partnership with leading technology firms. The government can also incentivize banks to facilitate loans for high growth companies to improve scale-ups’ access to finance, and become the customer itself by dedicating a minimum share of its procurement budget to scale-ups to help them access customers.

Finally, they explored the reasons as to why it is so important to have a “champion” that takes the lead on supporting the growth of scale-ups in Saudi Arabia, and the significance of public-private partnership to advocate for this agenda, a role that the Saudi Small and Medium Enterprises General Authority (Monshaat) could fulfill.

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