At a recent conference in Saudi Arabia, I overheard a conversation between two business leaders about their daughters’ marriage prospects. As the father of three daughters, I was curious to hear what they had to say. “Definitely not,” one of the businessmen said, “I am not going to let my daughter marry an entrepreneur. If he doesn’t have a stable job or predictable income, I ask you, how will he be able to support my daughter?” The other, in his traditional white thobe, nodded in agreement.
In 2011, a group of researchers conducted a survey on entrepreneurship in the MENA region and cited “non-acceptance from family members, lack of prestige, high level of competition, and fear of failure” as the top four barriers to starting a business (see Figure 1). In a region where schools and parents prioritize rote memorization over creativity, job security over entrepreneurship, and stability over risk-taking, young people naturally refrain from treading off the beaten path and launching new companies. Furthermore, other social factors, such as the lack of marriage prospects, explain why young Arabs aspire to be government employees and dream of job security.
Back in the United States, Steve Jobs, Bill Gates, and other entrepreneurs who navigated the frontier of digital industry are seen as national heroes. In public schools, students learn about the innovative endeavors of Benjamin Franklin and celebrate entrepreneurship as a national ethos. When politicians and civil society leaders speak about the American Dream, they describe tales of self-made individuals who went from rags to riches, pursued brilliant ideas, and took extraordinary risks to start businesses.
Saudi leaders have come to recognize the role of entrepreneurs in driving economic growth, and initiatives like “Saudi Fast Growth 100” and the King Abdullah University of Science and Technology (KAUST) are challenging business-minded youth to take risks. Following the 2008 tech start-up boom, the number of entrepreneurship initiatives has increased (see Figure 2). Moreover, the Kingdom is tackling a number of hurdles that entrepreneurs encounter, such as the lack of access to financing for small- and medium-sized enterprises and excessive business regulations. But while it is important to create opportunities for new businesses to compete and improve access to financial resources, policymakers often overlook an integral part of the entrepreneurial ecosystem: the cultural mindset.
At the end of the conference, I asked a local business leader to tell me about how he succeeded in the private sector. Instead of telling me about the brilliant business ideas and strategies he came up with, he focused on the number of times he failed in launching businesses. In fact, he mentioned that he was recently approached by a publisher asking him to write a book about how he dealt with his business failures. For Saudi Arabia’s young population, failure must be seen as a crucial ingredient to success, although it may be a hard fact to swallow. After all, the Arab Dream has been about job security and social prestige. However, if Saudi Arabia wants to compete in the global market, then the “fear of failure” culture will have change.
To tackle the social stigma behind entrepreneurship, we must begin with a network of support and acceptance from families and friends. Mentorship programs offer young entrepreneurs the opportunity to tap into an established network of business leaders, who can also serve as role models and save them from repeating the same mistakes. In May, Wamda’s Mix n’ Mentor in Riyadh brought together CEOs and entrepreneurs to share stories of failure in their commercial risk-taking. By pairing young graduates with experienced business leaders, workshops like the Mix n’ Mentor event can change the cultural mindset in Saudi Arabia by giving failure a human face. And as it turns out, those who have failed are doing better than all right.
Abdulwahab Alkebsi is Regional Director for the Middle East & Africa at CIPE.
Published Date: October 10, 2013