2,968 crowdsourcing and crowdfunding sites
Despite the region’s long history of innovation and its many cultural contributions, the Middle East and North Africa (MENA) haven’t seen many crowdfunding campaigns successfully meet their goals. While there are platforms in the region like Aflamnah, Yomken, and Shekra (an equity crowdfunding portal), these platforms aren’t seeing the same level of activity as their peers in other regions.
Still, given MENA's potential as a hotbed for crowdfunding activity, there are hopeful entrepreneurs looking to establish themselves as leaders in the field. One of these entrepreneurs is Joanna Truffaut, director at Mawwell (“fund” in Arabic), a recently launched crowdfunding platform focused on the Middle East, Africa, as well as Europe (EMEA).
The platform is available in both English and Arabic, and is currently hosting three projects: a travel app, a music album, and a children’s book. We reached out to Truffaut via email with a few questions about the platform and about crowdfunding in the Middle East in general; below are some of her most interesting responses.
On how the platform came to be:
Three years ago, I launched Ibtikarati.com, a virtual incubator which gained a lot of traction in the 12 months from its launch by building a strong community of startups, investors, and developers. Unfortunately, it became a sunk cost as we were not able to monetize it, and it became too expensive to maintain.
Then I came across the concept of crowdfunding through Kickstarter and I thought that after all, it could be possible to monetize online the idea of connecting creative or innovative projects with supporters willing to financially help a creator. So, Mawwell was born where Ibtikarati failed.
On her goals for the platform:
Mawwell hopes to become the leading EMEA rewards based crowdfunding destination for creative and innovative projects within the next 36 months, and number one in terms of funds raised in the MEA within the next 24 months.
On lack of platforms and crowdfunding campaigns coming from the region:
Although MENA currently represents the fastest growing region in the world, there are not many payment gateway options that can address the MENA region needs. This represents a significant barrier to entry for crowdfunding platforms.
Regarding the projects, actually you would be surprised by the number of creative projects and innovative people in the MENA region. The problem is the lack of information about funding possibilities, although there are a growing number of initiatives in the region, such as incubators (oasis500, In5, Afkar.me), seed investments, venture capital (MEVP, Beco Capital, N2V, STC Ventures), and now crowdfunding. Hopefully, this [problem of lack of information] is changing, and the crowd is becoming aware of the various financing platforms.
On why crowdfunding can make an impact in the Middle East:
In 2013, crowdfunding is expected to have reached $5.1 billion in funds raised, which accounts for an 81 percent increase from 2012, yet crowdfunding is still very much centered in North America and Europe. According to Massolution [a Crowdsourcing.org sister company – Ed.] more than half of the funding raised in 2012, $1.6 billion, came from North America and $945 million was raised in Europe.
So crowdfunding is still fairly untapped in developing countries, and it can make a huge impact on ecommerce development, and boost entrepreneurship in MENA. As you may know, MENA has a soaring ecommerce market — estimated to reach $15 billion in 2015 (up from $9 billion in 2012),according to market studies. And MENA countries need to tackle social problems by helping [to make it easier to] start businesses and boosting entrepreneurship. MENA has the world highest youth unemployment rates.
On its relatively high (7 percent) fee for successful campaigns:
We do not charge anything when a project creator posts a project like other platforms [Aflamnah, the most active platform in the region, charges a $100 flat rate to post a project, as well as a 6 percent success fee – Ed.] and we carefully choose projects. Mawwell is very selective with the projects fundraising campaigns it is enabling, which is a sign of quality for the project owners.
Projects campaigns need to match certain categories (music, art, films, gaming, comics, publishing, photography, technology, fashion, design), meet our guidelines. We do not accept charity, or fund my life type of projects contrary to most crowdfunding platforms with the exception of Kickstarter.
On obstacles to success, and getting around them:
Crowdfunding awareness in the MENA is definitively a challenge, as is payment processing choice. We are planning to integrate additional payment possibilities in the medium term, and are participating in lots of conferences and talks to build awareness around crowdfunding.