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A chat with ArabNet founder
Omar Christidis talks to Kipp Report about, among other things, his five most compelling reasons to attend ArabNet's Digital Summit in Dubai.
June 23, 2013 5:45 by Muhammad Aldalou
Are investors generally more risk-averse in the region?
You have to understand that investors here have to be a lot more careful. They don’t have the same exit strategies and opportunities as they do in the US or other markets. Since there aren’t many acquisitions in the region, investors can’t acquire a company that isn’t profitable, pump money into it and sell it to someone who will figure out how to monetise it. They have to look at companies that will generate revenue in the long run.
Look at Tumblr for instance. It has a tiny revenue stream and yet they were bought by Yahoo for $1 billion, because several investors were coming on board and pumping money into it. They believed in it and knew it would be worth something to someone who can monetise it properly. As long as your users and metrics are growing, even if you’re not making money, it still becomes a sexy asset to buy.
Exit deals like that aren’t clear enough yet in this region.
Do you think companies here are still unconvinced about Return on Investment on social media?
I think they haven’t quite figured out how to measure ROI on social media, and that’s on a global scale. I mean, how do you measure return on a community? On the other hand, I do think companies have become convinced that they have to be present on social media platforms, because there’s no question about the value proposition of being there, whereas ROI is just about measurement.
Look at the number of companies that, merely three years ago, didn’t have a presence and now do. What banks do you know in the UAE that aren’t on social media? Everyone, from retailers to car manufacturers, is getting involved because it’s more than making money. It’s about building a voice, a community and a brand.
It definitely requires a big investment, though. You have to be ready to be on there; being transparent, talking to people and responding. It’s a communication tool, but it’s also a potential sale platform and a customer service forum.
You have to be aware of what you’re going to do it. You’ll make mistakes and learn along the way, but carry a roadmap with you and have a vision. What content will I share? What sort of tone will my community have and what will I respond and not respond to? You need to have some answers otherwise you’ll end up with a disjointed presence.