The rise of the co-Founders

It is no longer a technology race, its a marketing race. Almost any software can be built or copied at a similar quality, its all up to marketing and customer grabbing at early stages of the product life cycle.

Recently I noticed an increasing trend of using the term “CoFounder and CEO of” on linkedin. The majority of the self described CEOs are fresh graduates or have just joined the IT field. Few of these startups are significant or were ever heard of out of the scope of their owners’ immediate circle of friends. It doesn’t stop at tech startups really it seems like everybody is trying to build something to call his own for a whole array of different reasons be it financial or the mere thirst to get the bragging rights or even in some cases peer pressure. (i.e. “in” people and fashion blogs)

Silicon valley parodied the culture of launching irrelevant startups quite nicely

Silicon valley parodied the culture of launching irrelevant startups quite nicely

The notion of being a middle-class salary man is no longer fashionable, As a generation we were raised that each and everyone of us is unique and destined for greatness settling into a life of corporate obscurity is not something can cope with easily. Financial reasons play a role here as well as startups appear to some as a quick way to make it into the double commas club (millionaires club) after all how hard can it be to build up a company and then sell it later for a couple of millions right. Given how the entry barrier is particularly low the common perception is that you don’t have to put a lot on stake in order to build a tech startup, All whats needed is a good idea and a couple of customer and things will organically evolve. Everybody can be an over night entrepreneur.

A website can be built and launched and wouldn’t cost more than a month’s salary hosting the product on the cloud can guarantee a easily affordable operational cost, in theory you can run the website forever securing the “entrepreneur” status for as long as you have it online. I’ve written an article not so long ago about the rise of social entrepreneurs in post 25 January Egypt and how few if any ever make a profit. People confuse having a successful product with having a successful startup, For the first the success is measured by hits/downloads/user-base while for the latter it all comes down to being revenue positive at some point (or at least the prospect of it). More importantly owning your website and URL doesn’t equate being an entrepreneur managing your own startup. Having a killer idea is not as valuable as it used to be, almost any idea can be replicated at an even higher quality what really matters is traction and a growing user base, given the social nature of most products it all comes down to the critical mass of users. Even if you are moving into a new area with no competitors once you achieve anything that resembles a success -and given the low barrier of entry- competition will show up.

Being an entrepreneur and managing your own startup is much more complicated than simply launching a site and getting a couple of hits everyday, there is a certain leap of faith required in order to actually manage your own startup towards success, usually this entails quitting your job and relying on your newly found venture for income. Being a part time entrepreneur almost never works, a CEO/co-founder is expected to spend 16 or 18 hours a day working on his brain child, doing it in the few hours you’ve got left after work would never cut it. So unless you are willing to do that please do not call yourself CEO/Co-Founder of one thing or another.

Still why not do it, with a low entry barrier and almost zero operational cost all of us can be entrepreneurs, the co-founders and CEOs of one thing or another. Profit, value and sustainability are all irrelevant, after all it is all about the bragging rights and the 15 minutes of fame.

**note : To be clear I realise that I sound as if I’m making sweeping generalisations there, however this is not the case, this article is about the type of “entrepreneurs” who do it for all the wrong reasons.

On Local Open Source Products

I was called earlier this week by some technology show inquiring if I’d join a forum discussing the local Open Source Projects, and the reasons why the are rather scarce. I ended up not being able to join that forum, but it did get me thinking, I can’t think of even a handful of products that originated in our region, or even contributions to existing products. Even with the recent startups/innovation boom, I don’t recall seeing any opensource code to speak off.

After spending some time googling around and searching for any serious opensource project i was only able to find a Linux distro (Ojuba) that was developed in our region and seems like even that project was stopped 2 years ago. I also recalled seeing some Egyptian themed redhat based distro but can’t recall its name, I’m sure however it was discontinued. Other than that I wasn’t really able to find any mention worthy Open Source projects to speak off. Still I was able to find several Open Source fonts and even music…so seems the Open Source shortage is limited to code.

In the last 5 years several products emerged, some where complex enough for its code to be open source worthy, kngine for instance with their semantic web based search engine…it faded out of the scene now, but i believe it’d have persisted if he chose to open source it. Same applies to several other projects that may have failed business wise, but would have definitely left an impact if its code was shared with the world. So why aren’t people sharing their code with the world in our region as they do in other places.

There are several approaches to open source code development for instance:

  1. an individuals building such an amazing algorithm then sharing it on github for the world to use.
  2. A Company builds a really interesting product and decides to release its code for developers knowing that they still own it as intellectual property even though the world can see the code you can’t use it to earn money without contacting that company first.
  3. A group of developers collaborate to build a project then share its code to the world.

My thought process led me to question the motivations that lead source code to be shared. I believe in cases of individuals code is shared as a way to gain credit, after all who doesn’t know Linus Torvalds, or Phil Zimmermann, and their contributions. Even though their code is free to use, they still made more fame and subsequently money out of their products than they’d have if they sold it to some corporation. As for corporations, sharing the code serves to allow people to port and improve it, also to go over the code and increase the resilience through a process of global peer review, a really decent example here would be Android OS, open source and with millions of variations out and yet not nearly as many security issues as iOS.

I believe the following reasons are why we don’t see that many open source projects originating in our side of the world:

Lack of Time (individuals): Time being one of the most expensive assets we have (and the only one we can’t replenish) is wasted in traffic, red tape and other smaller fruitless activities, the time left after doing all of this isn’t nearly enough to be donate to open source development. Developing elegant share worthy code takes a lot of effort, not to mention the clarity of mind to sit down and plan something.

Lack of Recognition (Individuals): The local eco-systems doesn’t reward people who’ve been involved in even successful open source projects. Most corporate would dismiss that as irrelevant.

Lack of Resources (for Companies): Managing a project to completion is expensive, sharing the code isn’t nearly as rewarding in our region due to the lax intellectual property laws. Your competitors can just take your code and use it as is without crediting or consulting you. and good luck trying to convince a judge that this was actually your code, I don’t believe they have computer code technical advisers in our judiciary system to being with. Furthermore I’m not really sure you can patent code. Sharing your code wouldn’t result in people porting and improving it while retaining the credit, instead it’d result in creating competition and wasting the resources invested in the product.

Please feel free to share your opinions and your points of view on this topic…

Local Products Data Security Concerns

Last week a mini scandal broke out when Pavel Durov the founder of Vkontakte Russia’s dominant social network fled Russia and made really disturbing statements about the Kremlin trying to coerce him into divulging information about Ukrainian citizens and anti-corruption activists. Already the Russian Government is the majority stockholder of Vkontakte and they are in full control of the company.

Today, Durov announced he has fled Russia, citing security concerns after resisting pressure from the Kremlin to share user information from the Vkontakte network. In his public statements he has said that, in particular, the Kremlin had tried to force him to turn over information about Ukrainian citizens and anti-corruption activists in Russia.

PavelDurovvKontakte

This fits perfectly with a concern I’ve had for a while now about the privacy and security of local products and services. In my opinion privacy laws implementation in our region isn’t sufficient to protect our data from preying eyes, especially if backed by the government. It is quite easy to subpoena the entire database of a social network company for instance, or even require direct live access to the service based on the telecom laws. It gets even more interesting when you think of all the different ways the government can use to coerce “convince” the product founder to divulge the information he has about anonymous users he doesn’t know personally.

The concern here is not about technical security of the product as much as it is about the physical security of the founder and his family. Personally I don’t believe it’d take a lot of effort from the correct authority to extract all the info he has on any of the products users. After all such authorities have really convincing methods.

Another concern would be the political affiliation of the founder, since the product is local, his political affiliation may match or be quite different from yours. There is no guarantee that his access to your data wont be use either way. Again referring to our lax privacy laws implementation. Even if implemented without proper periodical auditing there is no way to be 100% sure no one is snooping on your data.

That is why I choose not to use local apps and services as much as possible. Most offer geo-services (cairo360-bey2ollak-wasalny-circle tie-etc…) and the last thing I want is for some entity to have real time access to my where abouts 24×7. Also their is that inherent risk associated with installing any mobile app on your phone, most request access to your contacts anyway (all android have access to all photos stored on device), just think about where your data may end up migrating to without your knowledge.

Naturally these risks are associated with almost any product you end up installing or using but I feel a lot more comfortable knowing that my data MAY end up getting exposed to some XYZ developer in some obscure country who knows nothing about me and has zero interest on our current local affairs. And knowing that it’d be quite hard to coerce someone that far away.

The Egyptian Techtopus

Techtopus I’ve been closely following the class action law suite filed on behalf of 100,000 tech employees whose wages were artificially lowered in silicone valley due to agreements between tech employers (Intel, Adobe, Google and Apple) not to hire each other’s employees  and sharing wage scale information, Thus they were able to control salaries knowing that no one would tempt the employees with better salaries. As an Egyptian tech worker I was initially surprised, after all such agreements are common practice in Egypt, these gentlemen’s agreements as they call them prevent us from moving to better offers even if we were fully qualified for announced vacancy just because of the company we are currently working in. You get to learn about these agreements early on your career and you never think about their fairness or legality, they become “the norm”. I don’t think anyone ever asked why are they none documented gentlemen’s agreement rather than contractual obligations you sign in your contract, like for instance the clause that states you can’t work for a competitor for as long as 2 years after you leave your hiring company. Maybe just maybe this agreement is not legal, perhaps thats why you cant find any documentations, and hence it is called a gentlemen’s agreement.

gentlemen’s agreement (or gentleman’s agreement) is an informal and legally non-binding agreement between two or more parties. It is typically oral

The rise of such agreements took place after the infamous Etisalat Egypt head hunt, when they poached entire teams from all the usual tech-giants / competitors promising them double and sometimes triple the salary they were making, in turn that lead to a market wide salaries hike. In an attempt to make sure salaries will stay manageable several of the multinational tech giants struck these agreements to not cross hire. Knowing that this would guarantee that employees wouldn’t have a way out, and thus would settle for whichever salary they were getting.

After 2006’s Salaries hike, Egyptian tech giants decided to keep their employees salaries under control

In our highly specialized field usually you can only work in a handful in multinationals so there aren’t as many options as you’d imagine. I believe the company with the largest number of gentlemen’s agreements is Vodafone I think its common knowledge that employees can’t move from Vodafone to EMC, Alcatel Lucent or even IBM. Whom in turn must have their own agreements with a bunch of other companies. Oracle on the other hand doesn’t follow suite, since its mode of operation relies on poaching from others, and they have another technique they use to guarantee employee retention under a fixed salary (but thats another story). Try going on linkedin and go through various Egyptian accounts you’ll find that there is a growing trend, exiting a telecom to oracle and then to another vendor. The red giant is much more than a brand, its the escape door for all who’ve given up on moving out/on.

 

I know a couple of friends whose aspirations to get a much better job hit the wall of gentlemen’s agreement, talented engineers who applied in vacancies in vendors initially got accepted, then got rejected with a call from HR referring to the gentlemen’s agreement, some were able to overturn that through negotiating with the current employers. However by the time you are done negotiating your exit the vacancy is usually filled by someone else. Naturally the lax labor laws we have in Egypt would make following the american model quite hard, I can only imagine how hard it’d be to file a law suite claiming market wide salary fixing between tech giants. What really surprises me though is the none nonchalant attitude adopted by the HR departments in the mentioned multinational tech giants, how they talk about these agreements as if they are normal fair and the only way to do business.

 

Sources :

http://pando.com/2014/01/23/the-techtopus-how-silicon-valleys-most-celebrated-ceos-conspired-to-drive-down-100000-tech-engineers-wages/

http://pando.com/2014/03/25/newly-unsealed-documents-show-steve-jobs-brutally-callous-response-after-getting-a-google-employee-fired/

Wasalny’s Next Big Step

Last year I wrote an entry on how Wasalny is technically superior to Bey2ollak but due to how social apps work Bey2ollak is much more reliable. Which explained why Bey2ollak won the Google’s much coveted Ebda2 award. Seems like there is an interesting twist unfolding right now, in which Wasalny may end up having the upper hand.

Wasalny Vs Bey2ollak

Seems like the Kuwaity government is interested in using Wasalny as their official app, this twist means that Wasalny will have a new fresh start to grab the critical mass needed to maintain market superiority. This adoption grants wasalny access to this huge untapped gulf market, with most of the population being in their 20s-30s and most having access to a smart phone its a treasure trove that no one was able to break into prior to this point.

Kuwaiti leaders showed great support for the venture, installing the app on the electronic devices of every police officer and providing access to every billboards in Kuwait City to allow for real time traffic information.

Bey2ollak’s massive user base is irrelevant when it comes to global expansion, since the data set greatly relies on the location of the users contributing it. Furthermore one of the main reasons Bey2ollak was such a hit in egypt, the usage of funky franco arabi interface and street names actually works against it when we talk about regional expansion, I recon it’d be completely unreadable for none Egyptians. Bey2ollak team have been working on revamping their interface but they retained the quirky but cool franco arab routes designations, since it is one of their main selling points.

Full of terms only Egyptians would understand

Bey2ollak full of terms only Egyptians would understand

Wasalny is a bit more standard

Wasalny is a bit more standard

I believe Wasalny has a really interesting future ahead of it, with the partnership they have with Etisalat -which happens to have branches in most of gulf countries- and the official adoption by the Kuwaiti government its only a matter of time until it breaks into the gulf’s user base. Once the initial critical user base is achieved it’d be quite hard for any competitor to depose them.

**I’ll write a follow up post on the potential revenue streams traffic apps can generate.

sources http://www.wamda.com/1970/01/wasalny-co-founders-on-their-traffic-app-s-next-turn?ref=fb