HRH Prince Fahad Al Saud : US-based VCs do not support startups that think global from day one

ITProPortal met with HRH Prince Fahad Al Saud who is in London to officially launch a new application called InstaFeed. He is a former Stanford graduate from Saudi Arabia and co-founded, with Daniel Corso and Ranier Gadduang, Appiphany, a new breed of startups who seek to differentiate themselves through the way they produce apps. We discussed about his past as a former Facebook employee, InstaFeed and how it improves the Instagram experience, the growing role of social media in redefining the global fabric of civilisation and a lot more.

You describe yourself as a social entrepreneur. What does that entail?

Men are confined to traditional sectors, pretty much to the expectations in Africa and Asia (white collar jobs like doctors, lawyers, engineers). It’s a very cultural thing and women are definitely hungry for any opportunity that allows them to get a new skillset. Generally, in tech forums in Saudi Arabia and the Middle East, the ratio of women to men is high [skewed towards the former]. Anything that has a creative and flexible [will appeal to them], because they’re got a schedule to stick to. I did a talk about a service called Glowork which matches women with job opportunities, using the database from the government, looking at the country’s needs, figuring out what are the opportunities here for women, then looking at the CVs and doing a “Match.com”, training them and helping them understand, that for the first time in history, men and women have equal opportunities. It’s now about how much you want to utilise these tools. Part of social entrepreneurship is about investing in individuals through entrepreneurial programmes, thinking and creative problem solving, allowing them to see the opportunities available and how to utilise these tools in a really different way. In the US, they do it to promote themselves or their products, in other countries they use it to create revolutions.

When did your tech epiphany happen? When was it that you decided to go tech?

You know what they said about the acting bug? I got the tech bug. When I graduated from Stanford, my degrees were in mechanical engineering with a focus on product design, management and science engineering and Middle Eastern studies and literature, so none of it is computer science, although I programmed a little bit. The attraction came through a chance encounter with one of my friends at Facebook. It was starting to grow in the Middle East and they needed to translate some of the Arabic content that they were getting and I was actually one of the few Arabs in the US post 9/11, one of 10 Saudis there and the only Saudi undergrad from Stanford. That exposure to Arabs was limited just based on that. I started translating for them, made a joke, saying that they might as well pay me for this, I came in for an interview and literally history was made. Once I saw the opportunities and a group of people from different races, religions, sexual orientations and education backgrounds, getting together, sharing ideas and changing the world, that’s when I got the bug, want to bring change and that’s something I could not walk away from. When I left Facebook, I ended up working for the Saudi consulate and the government in charge of student affairs, trying to help them integrate into the community and the culture because it was difficult, a true culture shock. Many came in fear and lived in fear because they feel they were guilty before being proven innocent. But even as “noble” as that work was, I couldn’t get away from technology, so I went back because I believe that it is a platform that allows me to deliver more change. So I blame Facebook for giving me the tech bug.

Can you tell us more about Appiphany and InstaFeed?

Appiphany is a company started by me and two of my best friends (Daniel Corso, CFO, and Ranier Gadduang, CEO) and fraternity brothers. The concept is that of a superlean tech company, there’s three of us and we’re bizdev (business development). We manage a group of high quality developers all over the world and our focus is creating applications and services filling gaps and adding value and experiences to proven markets. Basically taking markets that we believe are the next big thing and looking at whether the needs are not being presented right now. More than ever before, growth happens on new platforms at an ever increasing rate. Before you had to wait for years, now it takes place in months. With InstaFeed, we were pre-empting the growth of Instagram, trying to add features to a platform in a creative way, adding value in the process. It positions us either in partnerships or acquisitions (ed: Not unlike what Summize did with Twitter back in 2008).

Right now we’re focusing on growth, we might go the Google way and auto-populate search immediately with default opt-in to receive popular feeds. The responsibility is on the user to opt-out. Other ways we’re investigating to generate revenues include a “click and buy” option or the possibility to influence a partnership between two entities (a celebrity and a brand) that share a common core audience. We’re really proud of pushing an international section for Instagrammers worldwide and highlight this and more; for example pointing to those in Saudi Arabia who are only doing business through their Instagram account. The ranking in that section is based both on content and on popularity. The value of Instagram as a platform is that it is very straight-forward, compared to Twitter. You can also comment, like pictures and repost content. Next will be an update which will allow users to become producers as well.

Why do you love London so much?

Creativity is still celebrated in London, it is a very eager and early stage, but not in a negative way. Not that Londoners are behind, they are instead more selective about where they want to get into when it comes to the tech industry. Nobody wants to be the next snapchat. They (the startup industry in the UK) are focused on revolutionary platforms, having a purpose and a focus, which reminds me of Silicon Valley in the early days (2008 to 2010) where people were actually solving problems, as opposed to just trying to make money as fast as possible. Here it is still creatively-driven. We want to set up here as I believe it would be a good thing for my partners to experience being Americans rather than being singled out for their ethnicity. You are very much “protected” and thus limited while in the US but not when you’re here. One of the beautiful things I’ve discovered here, and I understand well that it might not be everywhere, is the way Britons I’ve met do not tend to identify themselves with their countries of origin unlike Americans. I wanted my two other co-founders to come here and be referred to as “you”, Americans. So that they understand how that cultural difference affects an individual socially, on a creative level and how it can affect the product development. This is why I think London is comfortable enough for me. It is familiar but at the same time extremely different. What is happening in music, fashion and arts in London is great; there’s a generation here that’s very aware of things moving and that has dialogue. It is something we feel we need to be part of. In the US, everything is so centered on political correctness that you become numb.

I am hoping to come here and I want to convince Daniel and Ranier to come here. I am ready and the theory I have is that they feel so different in the US that they will feel as comfortable here. It is easier to talk to people and they are generally more genuine. People here think in terms of what you are about, what you offer as an individual, not what clothes you wear or how much money you have.

What do you think about the US startup market?

The US VC market is saturated with the focus being money and how fast you can make a quick buck. Valuations are being hit right and left and many think they’re experts when they’re not. Trying to follow a trend is not a genuine way of building a business, IMHO. It is not innovative and there seems to be an aversion within the VC community in the US for startups that, from the onset, want to go global. They are not really supported because it translates into a long term investment. VC want to have returns as quickly as possible; this can be very detrimental to startups as it instills a trader-like mentality in the ecosystem, which in turn encourages the rise of the superficial entrepreneurs rather than innovators.

There is a definite trend whereby bigger established companies, Google being one of them, create obstacles for startups to flourish until they can buy them. I didn’t want to be part of that, seeking a more natural, organic way to grow. That doesn’t mean that we can’t collaborate with them. Appiphany is working with a well known brand as an independent consultant to enhance a key feature on its product range range and working with other brands to present themselves in more sleek and innovative ways. We have gained a lot of experience since we’re part of that first generation of entrepreneurs in the social space and we’re eager to share it as well.

There’s also a new generation of what I’d call lazy media or social advocates or so-called experts who are, in reality, teams of interns hired to tweet and comment on Facebook. There’s no real skillset needed and no real value added to the company or the user. Big companies do not appear to be taking social media seriously, adding to a sense of superficiality that can only hurt, if not degrade, the value of social.

You need to have empathy to understand who your users, your followers and your audience are, what it means to communicate with them. My experience taught me that brands and companies want to communicate but don’t want to hear anything negative being said or written about them. In other words, they want to control the communication process. It is important that they understand who they are dealing with and how to engage with their stakeholders. Brands need to appreciate that their audiences want to feel that they matter, being recognised as human beings rather than just numbers.

You can bring as many so-called social experts as you want but until and unless you appreciate that basic requirement, the need of social empathy, that approach will be flawed. Brands can also capitalise on this by building solutions that allow audiences to engage with brands. Walmart did a great job recently, so did Nike and Red Bull, to interact with their fans and build relationships in different ways. Disruptive technologies, like social networking, have come about to eliminate the middlemen and brands can’t have it both ways.

Should big brands therefore have “social” built within them? Engrained in their DNA?

A hundred million per cent yes! Because if we look at how trade and commerce evolved over the millennia, they were based on trust and relationships. Brands used to so; culture was created around brands. Now, they are just being used to encourage people to spend and consume superficially, without trying to go beyond the purchase process. I blame the current economic situation for that, for forcing brands to focus on selling, selling, selling. Brands need to go back to their roots and integrate (or reintegrate) social. Creating an entrepreneurial spirit within the company may be part of the solution; the key is to allow employees to get together and brainstorm about how to create a new experience with this brand and not just for campaign as it is short-sighted, limited and all about hitting targets.

Appiphany’s focus is on fast monetising apps, ones that can be constructed in a short period of time. One of our apps for example took us only two months to build from conception to realisation. The innovation in the company is our brains; it’s all about the ideas and how you can execute it. It’s about prototyping, failing fast and failing often. If it doesn’t work, remove it and go to the next one. We want to be a factory of companies where the average is great and the great is a superstar. We don’t reinvent the wheel though. If we find an algorithm or a system that is useful to our plans. Services are going to be the same for social; curation, organisation, data collection and distribution are all very standard. The underlining infrastructure is similar, it is more about how you repackage the whole thing.

What’s your take on the current tech landscape in the Middle East at the moment?

It’s booming. There’s so much hunger and needs at the moment. The fact that 70 per cent of inhabitants in the Middle East are under 35, under-30’s account for 70 per cent of the population in Saudi Arabia alone. They are growing up with these new technologies and there is a real need because infrastructure doesn’t exist when it comes to supporting technologies and this is what is holding us back. We, as a nation, are trying to innovate as much as we can but there are limitations when it comes to laws and regulations, IP laws are almost non-existent which is why I incorporated both of my companies in the U.S. where they are properly shielded. Innovation is already happening and infrastructure is the only major reason things have not moved forward. My contribution has been to support the government and the private sector. A lot of young VCs, seed and angel investors are amongst a wealthy, new generation of forward-thinkers that have grown up in the Middle East. Watch out for us! We claimed our rightful position as equals when it comes to content creation and more than anything else, we are trying to push content, more specifically with my other company New Arabic Media, content that’s specifically geared towards an Arabic audience, for them, by them and inspired by the region. The language is a very important aspect because it is our identity. You will see a huge rise in investment from the region in Silicon Valley but also in Middle Eastern countries as well over the next five years.

What advice would you give to a foreign VC looking to invest in this region?

I would encourage them to come and visit us. Controversially, I believe that the western world owe it to us to do it because of the campaign that happened over the past 12 years focusing on telling us and others that we are Neanderthals, terrorists and are dumb and have nothing to offer the world. A lot of us got really constricted and stuck. You owe it to us because western companies do not create jobs here or help create value locally, not do they help us build infrastructure in our respective countries. There is a need for change in the Middle East and Africa. I would encourage them to come and visit and open their hearts and reminds themselves why technology is so relevant. It brings people from all over the world together, it brought about change and solved problems. If technology solves problems then you want to go to places where there are problems and invest in them. We consume content, platforms and applications that are social and have been created by the West based on shared human behaviour and needs. However, our real social and political needs and values are very different from the West and we need to be allowed and supported in doing that. Because as much as Facebook or Twitter are trying to help us, they are inherently US companies with considerably different values and cultural cues.

You mentioned that you incorporated your company in the US because of poor IP laws. Yet you say that there should be more indigenous online social services in the Middle East. How do you reconcile those two statements?

We don’t have enough, not because we don’t want to, but more because we don’t know how to. There’s a huge generational gap between the majority, which is predominantly young, and the governing minority, made up predominantly of older, very traditional people Three years ago, there might have been a couple of VCs in Saudi Arabia. Now there are a dozen of them. We are fast learners, but we need teachers.

What’s your view about the importance of social media during the Arab Spring?

In Saudi Arabia, that means educating both the older and younger and cutting in the middle. The onus is on the 80’s babies to bridge this gap because we know the “before”, the “during” and the “after”. Most teenagers haven’t known the pre-internet era. It is usually us that will go in the system and end up getting bogged down by social responsibilities and marred by risk-aversion. That generation need to help the older generation remove the fear associated with social communication technologies. At the same time, we need to educate the younger generation about the responsibilities associated with having access to that and growing up with it. Bridging that gap and creating the conversation are the first steps to get a continuous flow of ideas. At least for Saudi Arabia, I found that butting heads does get people anywhere . How it is going to affect the face of politics in countries? Who knows? We are still learning.

How do you see the social network scene evolve over the next 10 years?

When it comes to social media, personal limitations in different governments don’t work anymore. We are creating a new connected world, a new cyber country of people that are being matched by interest. If we don’t sit and agree about a code of conduct about what it means to be online, how to protect ourselves, cyber bullying and cyber terrorism are what may cause everything to tumble down. This is because we’re being exposed. From who stores our personal data to how it is being utilised, it is currently a mess and it will be an even bigger issue in the future. Bringing that conversation at the forefront is primordial to ensure that social media remains a valuable tool. Also there is a disconnect between local laws, values and culture and what users of social media have considered to be the norm on a platform that is not controlled by any government. Governments are not willing to see that happen because they still want to fight each other. These are outside of our hands and as a technologist, I believe this is how history usually evolves and because social media is a tool, it can also be a weapon.

Note that this interview has been edited to fit an online platform.