Saudis need more than a good idea to create the next app hit

Saudis need more than a good idea to create the next app hit
The coronavirus disease pandemic has given a new impetus to the digital transformation in Saudi Arabia, which is a key pillar of the Vision 2030. Social media
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Updated 04 October 2021

Saudis need more than a good idea to create the next app hit

Saudis need more than a good idea to create the next app hit

RIYADH: The KSA sees itself as a leading player in the vast and growing smartphone app race.

Saudi ‘buy now pay later’ fintech app Tamara (with 120 employees) raised $110 million in debt and equity funding from Checkout.com earlier this year.

And food delivery app HungerStation (founded in Dammam with over 1,400 employees) merged with Foodpanda, owned by Germany’s Delivery Hero, for an undisclosed sum in 2016.

With smartphone penetration at over 80 percent of the population, positioning it at number three globally, “Saudi Arabia dominates the region’s mobile app use because of its size and its purchasing power”, Imad Jaroudi, CEO of Jaroudi Media (a digital marketing firm based in Riyadh, Manama and Beirut) told Arab News. 

While tech might have been a luxury before COVID-19, it soon became a necessity

Kholoud Al Mohammadi, a startup mentor and Investment Manager at FII Institute

“The majority of its population is under the age of 40. These are young and talented individuals who are quick to embrace the new tech era and want to be part of it.” 

The coronavirus pandemic has been an additional driver of app use in Saudi Arabia as it was across the world. 

“Sectors normally slow to embrace tech, such as government and healthcare, were compelled by the pandemic to deliver their services online”, says Kholoud Al Mohammadi, a startup mentor and Investment Manager at FII Institute. “While tech might have been a luxury before COVID-19, it soon became a necessity.” 

Most Saudis can attest to that, as public service apps such as Covid passport app Tawakkaina and health services app Sehhaty became an essential part of daily life — in addition to the host of retail, gaming and social media apps already present on most smartphones.

Market research firm Grand View Research values the global mobile app market at over $170 billion and projects growth at a compound annual growth rate (CAGR) of 11.5 percent between 2021 and 2027.

But there are some 9 million apps available worldwide and counting fast - so how does a Saudi app developer stand out from the crowd and establish a new brand in such a competitive environment?

It requires a lot more than just a good idea. Initial development costs run from SR60,000 to SR150,000 — with some e-commerce apps going into the millions. But the creation of the app is only part of the story, and many would-be innovators are not fully aware of that.

“If someone asks me to help develop an app, I’ll first see if it is simply replicating many other apps”, says Jaroudi. “After all, why spend time and money on something that is already out there? Then I will ask about the feasibility study. Someone might come up with a good concept — but they want to embark on it right away, without any market research or thought about budgeting and management.”  

If someone asks me to help develop an app, I’ll first see if it is simply replicating many other apps

Imad Jaroudi, CEO of Jaroudi Media

Khurram Ali, CEO of Riksof (a Gulf-wide app developer), agrees, stressing that the viability of an app “is mainly about execution. You start off with an idea – this is a problem I see and this is my solution. But the execution is how you take your idea to the market: Obviously having a fast and streamlined app that provides clear value – but then handling customer service, managing cashflow and raising the funds to carry you through to the point that your product takes hold.” 

No innovator will have all of those skills, or that ability to multitask — therefore an app developer must have a strong team from the outset, and that includes IT talent. For while it may be tempting to outsource all development to a low-cost region such as India or Pakistan, this poses a risk of the management team not fully understanding their own product – a painfully evident shortcoming when seeking further investment. 

Even with sound management in place, a solid feasibility study and business plan, and a unique offering that delivers real value, an app could still receive negative feedback if its functionality is below par in the early stages. 

Ali is reassuring on this point. “It happens all the time”, he says. “You get poor reviews and improve the app based on that. It’s just not possible for the first release to be perfect - but if you address that negative feedback, you can improve your solution and grow your business. Someone might install and then delete your app - but install it again six months later if it’s recommended by a friend.”

And based on customer feedback, the app can evolve in unexpected ways – so flexibility is key. For instance, Dubai’s Careem – a regional unicorn - started as a corporate car booking solution, and morphed into taxi services, then into food delivery. Careem (with over 1000 employees, not including driver ‘partners’) was acquired by Uber in a $3.1 billion transaction in 2019.

The app space is no doubt tough to crack — in Saudi Arabia as anywhere else. But this is a rapidly expanding online industry, worth many billions. With a smart approach, and with lessons learned from others’ successes and challenges, there is still plenty of room for innovative new players.


John Kerry to attend Middle East Green Initiative Summit in Saudi Arabia

John Kerry to attend Middle East Green Initiative Summit in Saudi Arabia
Updated 6 sec ago

John Kerry to attend Middle East Green Initiative Summit in Saudi Arabia

John Kerry to attend Middle East Green Initiative Summit in Saudi Arabia
  • Kerry will “engage with government counterparts and private sector leaders on climate crisis

LONDON: US climate envoy John Kerry will travel to Saudi Arabia on Sunday to take part in the Middle East Green Initiative Summit.

During his two-day visit to the Kingdom, Kerry will “engage with government counterparts and private sector leaders on efforts to address the climate crisis,” the State Department said.

Kerry’s meetings will “bolster the United States’ bilateral and multilateral climate diplomacy” ahead of the COP26 climate summit in Glasgow that starts on Oct. 31.

Saudi Arabia will host the inaugural Saudi Green Initiative Forum and Middle East Green Initiative Summit in Riyadh on Oct. 23-25.

The environmental initiatives were launched in March by Crown Prince Mohammed bin Salman. Together they aim to plant 50 billion trees in the region and reduce Middle East carbon emissions by 60 percent.


NEOM’s green hydrogen plant to operate in 2026: Air Product’s CEO

NEOM’s green hydrogen plant to operate in 2026: Air Product’s CEO
Updated 21 October 2021

NEOM’s green hydrogen plant to operate in 2026: Air Product’s CEO

NEOM’s green hydrogen plant to operate in 2026: Air Product’s CEO
  • Seifi Ghasemi noted that the project is the biggest in the world and that it is the first time for the company to handle a project with this scale, echoing a similar comment from ACWA Power CEO to Arab News. 

NEOM’s green hydrogen plant will start operations in 2026, the chief executive officer of Air Products & Chemicals revealed in an interview with Alarabiya.

The project will export hydrogen in the form of liquid ammonia to the world market for use as a biofuel that feeds transportation systems.

Seifi Ghasemi noted that the project is the biggest in the world and that it is the first time for the company to handle a project with this scale, echoing a similar comment from ACWA Power CEO to Arab News. 

This comes amid the Kingdom’s directions towards green energy. 

 


US jobless claims fall; Turkey’s central bank slashes interest rate again: Economic wrap

US jobless claims fall; Turkey’s central bank slashes interest rate again: Economic wrap
Updated 21 October 2021

US jobless claims fall; Turkey’s central bank slashes interest rate again: Economic wrap

US jobless claims fall; Turkey’s central bank slashes interest rate again: Economic wrap

Americans applying for jobless benefits declined to 290,000 in the week ending 16 October, compared to the previous seven day's 296,00 claims, official data showed. 

This is the lowest level since March 2020 as job hirers hold on to their employees as a result of worker shortages.

Turkish interest rate falls once more

The Turkish Central Bank decided to cut its interest rate again from 18 percent to 16 percent, despite rising inflation and a depreciating currency. 

This decision came after the president renewed calls to alleviate borrowing costs to promote economic growth. Economists considered this confirmation of the bank's loss of independence as the president sacked the last three central bank governors.

South Korea's exports

Based on data released by its customs agency, South Korea's exports jumped in the first 20 days of October by 36.1 percent compared to a year earlier, while imports soared by 48 percent, causing a provisional trade deficit of $2.49 billion.

Exports rose the most for petroleum products and vessels as they leapt by 128.7 percent and 93.5 percent respectively.

The data showed that exports to China, the United States and the European Union increased during this period by 30.9, 37.1 and 42.1 percent respectively.

Sub-Saharan Africa’s recovery at risk 

The IMF said that the weak vaccination rollouts in sub-Saharan Africa could setback the region’s economic recovery in the coming period.

While higher commodity prices and favorable harvests were beneficial for some countries, the overall outlook is pessimistic as the region is likely to considerably lag behind developed countries.

The international organization expects sub-Saharan economic growth to be 3.7 percent in 2021 and 3.8 percent in 2022. 

Russia’s producer prices

Russian producer prices went up by a 26.3 percent annual rate in September, official data revealed. This is the lowest level since March and was mainly driven by a 41.4 percent surge in costs of raw materials extraction and a 25.4 percent jump in manufacturing costs.

China’s investments abroad

China's non-financial outbound direct investment (ODI) grew by 2.4 percent in the first nine months of 2021 compared to the same period last year to reach $80.78 billion, the commerce ministry said.

Ukraine’s interest rate 

The Central Bank of Ukraine kept the interest rate on hold at 8.5 percent. However, the bank said there was a possible chance to increase the rate in December if needed to manage rising inflationary pressures.


TASI closes 0.3 percent higher at 11,940 points: Market Wrap

TASI closes 0.3 percent higher at 11,940 points: Market Wrap
Updated 21 October 2021

TASI closes 0.3 percent higher at 11,940 points: Market Wrap

TASI closes 0.3 percent higher at 11,940 points: Market Wrap

RIYADH: The Tadawul All-Share Index was up 35 points on Thursday, or 0.3 percent, closing at 11,939,58 points.

Some 202.4 million of shares changed hands in 305,000 deals.

Al Rajhi Bank, SABIC and Saudi Aramco rose by 1 percent.

Baazeem was the top gainer, rising 5.6 percent, to SR124.80, with about 2.2 million shares traded.

Sulaiman Al Habib jumped 5.2 percent, to SR178.20.

Alinma Bank, Arab Sea, Sipchem and Saudi National Bank recorded their highest closings since the listing.

The parallel market index “Nomu” decreased by 719.49 points, or 2.94 percent, and closed at 23730.47 points. The liquidity amounted to about SR15.6 million.

Makkah Construction declined 1.9 percent to SR77.10. In Q3 2021, the company recorded a net profit of SR12 million.

NADEC and National Gypsum closed at SR34.95 and SR46.80, respectively.


Cryptocurrencies benefit from Bitcoin's gains: Crypto wrap

Cryptocurrencies benefit from Bitcoin's gains: Crypto wrap
Updated 21 October 2021

Cryptocurrencies benefit from Bitcoin's gains: Crypto wrap

Cryptocurrencies benefit from Bitcoin's gains: Crypto wrap

RIYADH: Leading cryptocurrencies have mirrored Bitcoin’s gains with strong performances in the past 24 hours.

Ethereum and Solana are up more than 10 percent, after Bitcoin surged above $66,000 on Wednesday.

Edan Yago, the lead contributor to the Bitcoin DeFi protocol Sovryn, said: “As big as Bitcoin is now, it’s a mere fraction of what it will be.

“An entire borderless economy will be powered by sound money. An economy far larger than our current global economy. Why? Bitcoin finally brings property rights and economic access to billions of people.”

 Ruud Feltkamp, CEO of cloud-based automated crypto trading bot Cryptohopper predicted that Bitcoin’s value will continue to grow.

“As expected, Bitcoin reached its all time high. It’s expected that the long volatile route to the top starts now, where I expect Bitcoin’s peak around Christmas. We often see that when Bitcoin makes a move, the altcoins follow in the two weeks after, which could explain the latest surge in Ethereum and Solana,” he said.

Trading
 

Bitcoin, the leading cryptocurrency in trading internationally, traded lower on Thursday, falling by 0.55 percent to $65,286 at 4:49 pm Riyadh time.

Ether, the second most traded cryptocurrency, traded at $4,251 up 6.74 percent, according to data from Coindesk.