Startups in the Middle East: Does government help or hurt?

Chris Schroeder at 1776


“When diplomats get involved, it’s not a good thing.”

That’s what Chris Schroeder, author of Startup Rising: The Entrepreneurial Revolution in the Middle East, had to say about government involvement in entrepreneurship in the region, at an event on Thursday, October 10, 2013, sponsored by 1776, the startup incubator in D.C., and Meridian International Center.

Schroeder’s book documents the explosion of startups in the Middle East, a break from the narrative of conflict and gender inequality cast by the media.

This boom in startups stems from a combination of capital, increasing access to technology, and an optimistic, problem-solving mindset. “Entrepreneurs are saying ‘I’m tired of waiting for a solution, I’m gonna make my own solution,’” Schroeder says.

But according to Schroeder, the boom doesn’t come from public-private involvement. If anything, it hinders.

He gave an anecdote of a tech startup competing for a partnership with Google, which required them to travel to Silicon Valley to pitch their idea. When they went to get their Visas, the embassy turned them away, saying, “After Libya, we can’t stick our necks out.”

Getting visas is always a battle, even for programs within the State Department. But the idea that government should “stop talking about it,” turns some heads.

Meridian International Center, the co-sponsor of the event, gets most of its business through State Department grants to arrange international exchange programs. Entrepreneurship is often a theme for these projects. For the past two years, we have administered an International Visitor Leadership Program project entitled “A New Beginning,” a partnership between the State Department and the Entrepreneurs’ Organization. The project brought 28 entrepreneurs from around the world to the U.S. on an all-expenses-paid three-week networking tour of the United States.

Schroeder described two big problems with government programs 1) They are often top-down big, inefficient projects and 2) politics tend to mess things up.

The oh-so-common top-down thinking is a problem because it suggests a one-way flow of ideas, from the United States to those deemed less knowledgeable.  And we don’t need a reminder of how politics can mess things up.

So can these exchanges be viewed as more government programs which waste entrepreneurs’ time?

If the exchange is a one-way top-down conversation, then perhaps Schroeder is right. But if there is truly a two-way exchange of ideas and resources, the potential really expands.

While Schroeder’s comments may have focused on programs that aim to shift the economic environment to one which favors innovation, it’s a valid question to ask. As Schroeder said, it is rare to question the narratives we know and love.

This month, I’ll reach out to those entrepreneurs and find out the real impact on them and those they met with. If entrepreneurs teach us anything, it’s that we should never stop making the inquiry.