desert refrigerators in Morocco, a bracelet that prevents heart attacks in Tunisia or a charitable fundraising system in Egypt: there is no shortage of solidarity innovations in these three countries, which are positioned at the forefront of social entrepreneurship.

Morocco now has more than 250 start-ups. Tunisia, with a hundred start-ups, is for its part in 7th place in the Seedstars World ranking, an investment company that has listed the countries offering the best conditions to launch a start-up. Finally, Egypt crushes all records with thousands of start-ups born between 2012 and 2013 according to the Egyptian census institute.

How to explain the rapid growth of this type of business in countries with fragile economic indicators?

According to data from Mattermark from 2015, if, for several years, start-ups were mainly developing in sectors such as mailing and dating, they are now interested since 2012-2015 also in banking, health , loans, bitcoin, e-commerce etc. More traditional fields of activity such as transport and housing are also at the heart of concerns, the objective being to consume differently by promoting social assistance. According to the Atlas of start-ups, which focuses on the French ecosystem, we find the same trends in the collaborative economy, big data, MOOCs or even crowdfunding or “the financial power of the crowd”.

Collaborative economy and young societies

This trend towards a so-called collaborative economy finds its full meaning in emerging countries where start-ups have been launching for a little less than ten years. These countries have started to interest foreign donors and since then, several start-up acceleration programs in general have been born, such as Flat6labs in Tunisia, Innov Invest and Numa in Morocco.

These foreign funds come to meet a financing need of this type of business considered volatile and insecure, hence the virtual absence of traditional bank financing which remains reluctant in the face of a slow return on investment. It should be noted that these countries have kept a so-called continental mode of financing mainly focused on banking establishments. For young entrepreneurs this may even be the only mode of financing available.

Apart from the “financial gap” left by the banking sector of these countries which have refused to finance start-ups, foreign investors (investment funds, investment accelerators) have also seen social potential far from negligible.

These companies are made up of young populations with an average age between 25 and 32 years (according to the Tunisian National Statistics Institute, INS and the National Institute of Statistics and Applied Economics Morocco). The latter, and especially young graduates, are terrorized by the fear of endemic unemployment, the figures for which border on indecency. According to the INS, in 2016 Tunisia had 267,7000 unemployed graduates for the third quarter, a rate of 31.9% of the total number of unemployed.

However, the very profile of these young unemployed, for the most part fond of new technologies, talented, ambitious and in no way averse to change, is a particularly beneficial point for investors betting on the new economy.

Tunisia, 2011. Social and political movements in Egypt and Tunisia have influenced the promoters of innovative projects. Habib M’henni / Wikimedia, CC BY-ND

The revolutions in Egypt and Tunisia were not necessarily the starting point for these start-ups but rather the engine of their proliferation. This new generation has realized that it is capable of changing the rules of the game. The Arab Spring has uninhibited young people who have learned that change is not impossible and that they are able to take their destiny in hand .

Carriers of citizen projects

From our many readings on start-ups and young people who have chosen the path of entrepreneurship, we realized that a strong point unites most of them whether they are Tunisians, Moroccans or Egyptians. : their social sensitivity. Aware of the economic difficulties of their countries, they are driven by the desire to fight unemployment by creating their businesses but also by improving the lives of their fellow citizens.

Many of these start-uppers are promoters of transport and health projects, the objective is to compensate for insufficient public investment.

Thus, BeThree, a Tunisian start-up created by three students of the Esprit engineering school, has succeeded in developing a smart bracelet that detects sudden changes in heart rate as well as high blood pressure, preventing a possible heart attack. This start-up which was born in 2015 in the lab of Esprit (engineering school in Tunis) mentioned a few months ago the possibility of a partnership with the Wonka Lab, an accelerator based in Los Angeles, California . “With our incubation at Esprit drawing to a close, Wonka Lab offered to help us expand into the American market,” said one of the entrepreneurs at Le Monde.

Carmine, born in Casablanca, promotes car sharing, a solution for young workers who cannot afford a vehicle. It still exists and sees more and more stations available, the company is thinking of generalizing its concept and applying it to other Moroccan cities

Meetings of innovative project leaders in the MENA region organized by Start-Up MENA. Start Up Mena / Flickr, CC BY

Others are positioning themselves in clickfunding such as Bassita (simple in Arabic) in Egypt who used an innovative fundraising mechanism allowing access to clean water in more than 1,000 households. This model enabled her in 2014 to finance a thousand pairs of glasses to embroiderers in one of the poorest provinces. In 2015, 30 children who have never seen the sea, spent one day at the Red Sea.

Safa, a Moroccan startup also started by students from Mohammadia Engineering School, has developed a water filter in clay and wood. The creators decided that the product would be made by housewives and that part of the proceeds went to the manufacturers.

However, whatever its nationality, whatever its field of activity, the start-up today keeps the same Achilles heel: a strong dependence on private financing during its start-up phase which can make it fragile and alienated from its funders.

The economic future of these countries will henceforth be co-written by these start-ups. The goal today is to successfully bring them to the attention of government policies in order to provide them with the best regulatory and fiscal conditions to keep them going.

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By Ben Hamadi Zouhour, Teacher and researcher in finance, accounting, management control, Normandy School of Management

The original version of this article appeared on The Conversation.

About The Author

CEO AfrikaTech

Comme beaucoup de personnes j’ai connu l’Afrique à travers des stéréotypes : l’Afrique est pauvre, il y a la guerre, famine… Je suis devenu entrepreneur pour briser ces clichés et participer à la construction du continent. J’ai lancé plusieurs entreprises dont Kareea (Formation et développement web), Tutorys (Plate-forme de e-learning), AfrikanFunding (Plate-forme de crowdfunding). Après un échec sur ma startup Tutorys, à cause d’une mauvaise exécution Business, un manque de réseau, pas de mentor, je suis parti 6 mois en immersion dans l’écosystème Tech au Sénégal. J’ai rencontré de nombreux entrepreneurs passionnés, talentueux et déterminés. A mon retour sur Paris je décide de raconter leur histoire en créant le média AfrikaTech. L'objectif est de soutenir les entrepreneurs qui se battent quotidiennement en Afrique en leur offrant la visibilité, les connaissances, le réseautage et les capitaux nécessaires pour réussir. L'Afrique de demain se construit aujourd'hui ensemble. Rejoignez-nous ! LinkedIn: https://www.linkedin.com/in/boubacardiallo

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