Bringing Sustainability to MENA’s Cleantech Startups
Middle East and North African countries arguably need local cleantech investment more than any other region in the world. Why? Because by 2050, the region’s electricity demand will more than double, and its per-capita water availability will have halved. In less than a decade its waste production will also more than double.
The good news is that more cleantech companies were launched in MENA during the last two years than in the six years between 2007-2012. In fact, 90% were created in just the last five years, according to a whitepaper issued by Wamda Research Lab and supported by GE as part of the MEMakers GE initiative with Wamda.
The report, which represents the first dedicated study of MENA cleantech startups, identifies top barriers to faster growth in the sector. These roadblocks include limited cleantech awareness among consumers, which dampens prospective demand; a small investment pool, with 43% of surveyed startups relying on self funding and only two venture capital firms identified with a mandate to invest in cleantech; small pool of qualified staff; small number of mentors in the cleantech space; and a dearth of funding, facilities, and human capital for cleantech startup R&D.
Among the dozens of successful cleantech startups identified by the study, three were noted in particular. They are Tunisia-based Saphon Energy, which makes the Saphonian Zero-Blade, which is designed to convert the kinetic force of the wind into electrical power.
Another example is Jordan-based Satchnet Electronic Systems, which provides intelligent systems integration services for energy optimization in infrastructure. As well, Saudi-based NOMADD Desert Solar Solutions is developing a robotic machine used to clean solar panels in the desert. It was created at the King Abdullah University for Science and Technology.
The report, titled, “MENA’s Cleantech Startups: Unlocking the path to scale to solve environmental challenges,” makes a number of recommendations to help energize this sector’s startup ecosystem. They include: encouraging large corporations to partner with startups to create more opportunities for cleantech entrepreneurs to commercialize solutions, encouraging more R&D funding, and an increased focus on R&D in higher education.
Other recommendations include attracting and identifying more investors who understand the cleantech startup space, have a higher tolerance for risk, and can help startups sustain and scale. Growing the capacity and the quantity of cleantech pre-incubators, is another suggestion, as is developing more cleantech-relevant training opportunities and university courses to build the talent pipelines.
The whitepaper interviewed 50 entrepreneurs, seven investors, five incubators and accelerators, and 30 thought leaders operating in the renewable energy, energy efficiency and energy storage, water, agriculture and waste sectors.
GE supports the region’s startups through a range of activities, including GE Garages in Algeria; Innovation Centers in Saudi Arabia, the UAE and Turkey, and a startup accelerator in Egypt.