(MENAFN- Nam News Network)
by Dana Halawi
BEIRUT, Jan 11 (NNN-XINHUA) – Lebanon's startups are facing numerous challenges, in light of the country's political instability and the economic crisis that started in 2019.
Wassim Kari, a co-founder of Parallel Health and Beauty, a group of companies focusing on digital content and e-commerce in the beauty field in the Levant region, told Xinhua that, one significant challenge facing Lebanese startups is the lack of access to funds, as the local venture capital ecosystem slowed its activity, amid the current political instability.
“It is challenging to operate a business in a hyperinflation environment, where we strive to grow faster than inflation rates and reduce our costs to secure sustainable operations ... So growth and profitability are big challenges in Lebanon, but it also provides an opportunity to learn new ways to run our startup,” he said.
Kari said, the crisis in Lebanon pushed startups to expand outside the country, to maintain their growth and survival. His company, for example, has already succeeded in expanding its operations to Jordan and Egypt, while also registering a holding company for his business in Cyprus, to attract additional funding to his business.
Kari's company is also facing the challenge of rebuilding talent, amid the brain drain, following the Beirut blast and financial crisis.
“My partners and I had to recreate the whole team and provide training all over again to our new people,” he said.
Toufic Azar, a co-founder of Meacor, a startup developing a novel catheter for the treatment of heart valves, said, the lengthy governmental procedures and paperwork, as well as, the outdated laws impede business in Lebanon.
Azar now puts the company's headquarters in the United States, where he thought, the entity registration and fundraising are much quicker, leaving only an R&D office in Beirut.
Maroun Chammas, CEO of Berytech, an institution that supports Lebanese entrepreneurs, startups and business owners, noted that, Lebanese entrepreneurs need help accessing overseas markets, mainly when exporting food products, which requires a series of certifications.
An additional challenge facing entrepreneurs in Lebanon is the high cost of electricity, which could make up around 35 to 50 percent of the total operational costs, said Chammas.
Chammas said that, the startups in Lebanon currently provide around 10,000 direct and indirect jobs, mainly in agricultural technology and clean technology.
He stated that, the future of entrepreneurship could be promising in Lebanon, if the country succeeds in restoring security and stability, to provide the investor with a law-based framework. At the same time, he emphasised the need to undertake reforms, restructure the banking sector, and improve the infrastructure, including electricity.– NNN-XINHUA