what about endeavor?

One of the key missing components for aspiring entrepreneurs in the region appears to be capital. Most of the entrepreneurs I've met or heard of in Jordan are Western-educated and come from money. Thus, they have the luxury to experiment with new ideas without having to worry about how to meet next month's rent payment and put food on the table. In many cases, they also have access to family money that can fund their venture beyond just the expenses of the founding entrepreneur. The obvious question is, where does that leave the other 99% of society? What opportunity exists for the smart, hard-working Jordanian who manages to get into Jordan University on his own merits, not because he can afford to pay? (As an aside, in Jordan, if you make the grades on the entrance exams you can go to University for a small fee. If not, you can pay 4-5x the fee and attend anyway. Presumably there are still some minimum requirements even for those who can pay).

The answer is that there is virtually no opportunity. The smart and hardworking middle class Jordanian can work at a bank or some similar company for $500-600 monthly starting salary. This amount will hardly cover rent, so most young professionals live at home.

At its core, Endeavor recognizes the large gap between microfinance loans available to small mom & pop shops and private equity available to large companies. There is no funding to help establish high growth companies and take them to scale. As such, Endeavor helps its entrepreneurs gain access to capital - be it in country, in region or globally. My primary project with Endeavor Jordan this summer is to map the venture capital and private equity landscape in the region, determine which funds can be most useful for Endeavor Entrepreneurs and build relationships between these funds and Endeavor.

The Jordan venture market is nascent. Investors also tend to be more conservative here than in the U.S. This means they often under-value young companies or are simply unwilling to invest. Thus far, I have discovered about 8 funds. While this is a good number for such a small market, let's not get too excited. Most of the funds are very small, many haven't raised their full target, and several aren't focused on early stage companies. Fortunately, most people are very willing to meet with Endeavor so I have already had one meeting and have a couple more scheduled.

However, I will have to look beyond Jordan to find additional sources of capital. The challenge is that firms like to invest close to home. Gulf money prefers to either stay in the Gulf or invest in developed markets like the U.S. and Europe. This is one of the primary problems I wish to research. When people think of the Middle East, they often think of oil and money. The money is in the Gulf, not the Levant (area comprising Syria, Lebanon, Jordan and Palestine). The Levant has the knowledge and skills. However, Gulf money does not come to fund these skills. Why? There are many possible reasons including lack of exit opportunities, small markets, lack of venture finance sophistication, difficulty of screening for the best entrepreneurs.

Perhaps an organization like Endeavor can play a role. By rigorously screening for the best entrepreneurs with the greatest potential, and providing these entrepreneurs with strategic guidance, Endeavor may help make them attractive to funders outside of Jordan. My job is to find these funding sources, educate them on the Endeavor model and get them excited about the prospect of investing in Endeavor entrepreneurs.