An untold story of the Tunisian startup ecosystem | Hacker News Reader

An untold story of the Tunisian startup ecosystem

realisticoptimist.io

38 pointsredbell19 comments

Tunisian here. The local ecosystem isn’t that strong relative to other players in the MENA region.. for now. If you dig under the covers, the most successful examples and exits started out in Europe or NA by Tunisian founders with a secondary presence in Tunisia.

I think it comes down to two main reasons:

1) Insane levels of regulation and bureaucracy, with a sprinkle of corruption.

2) A banking system that seems diversified and modern on the surface, but is actually an oligopoly and extremely behind technologically.

That being said, I think there is a lot of talent in the country. Also, at least among the younger generation, there has been a shift towards learning English (instead of French) to better work with the US market.

Side note: I’ve always wanted to work on a fintech startup for the Tunisian market to help with point (2) above, but as soon as I think about dealing with the banking system and government regulations, I reconsider.. One interesting player in this space is Flouci.

Tunisian here too. Speaking English is also an advantage because the anglosphere isn't predisposed to prejudice against north Africans.

Good point.

Can you elaborate or point to some writing on this topic? Who is prejudiced against North Africans and why?

>Who is prejudiced against North Africans and why?

I think France, Germany and the Netherlands have some degree of prejudice against North Africans (specifically Moroccans and Algerians).

As for why, you'd need to consult at a history book and look at the socioeconomic statuses of the aforementioned North African diasporas in those countries.

Are there any French banks with a presence in the Tunisian market that would offer a smoother integration for any fintech start-up?

Not entirely sure. But just to clarify, it isn’t purely a tech problem, but also a lower level banking infra problem.

Two things to note:

1. Tunisian currency is tightly controlled by the central bank, which means it is very difficult to move currency out of the country. Therefore, you - as a fintech startup - would need to integrate with the local banking system and separately setup a legal pipeline to be able to move money out (e.g., to spend on infra costs, SaaS products, etc.).

2. Credit cards do not exist and debit cards are not widely used for payments; cash is still king. So any startup that wants wide market penetration needs to deal with cash at some level. It’s kind of a chicken and egg problem.

First of all, I love such perspectives. Could anyone point me to more similar things (describing the business worlds elsewhere)?

Aside from corruption, funding etc. the author is in a veritable smorgasbord. There are countless unsolved problems in the local market because few seek to address them. Instead of competing with a thousand other startups for a reddit clone or some sort of dev tooling, he could concentrate on solving day to day struggles of the average Tunisian, transforming people's lives through tech.

Indeed, that's what the startups in the incubator were doing! But instead of embracing that, he seems to complain that they don't want VC funding, they don't want to scale to the whole world? And then complains about how it's difficult for them to get VC funding... How strange and circular this logic!

In Eastern Europe or Latin America, many companies grew quickly doing this a few decades ago - developing alternative payment systems etc. to bank the unbanked as aogaili alludes to. How amazing it would be if today we had the chance to develop new infrastructure on which future products would be built! Alas, everything seems done and ossified. How green the grass on the other side is...

While I don't think you should have been DVd, I think that you are ignoring his argument that the Tunisian market is just not there. And, frankly, if you can compete, with local talent, on a global scale, you have a lot going for you, and, it will inevitably lead to more at-home investment to support all the money you are bringing into the local economy.

I also find it hard to justify criticizing someone's decision with years of experience in that market.

I say the above out of nostalgia for my past, when I was working in the Romanian and Russian speaking markets. In those days, charging people for software was a no go as you would just invite warz people to break them but infrastructure and business services were valid as were assisting companies who wanted to enter the markets for whatever reason. The goal was to make a self-profitable company and build it from the ground up which is how the Eastern tech hubs grew.

I believe this is a better model than chasing after VC money a la San Francisco, especially when the VC pipelines have dried up even in those areas.

Market is small but these counties have tons of issues that need to be fixed instead offshoring and mind drain their resources

Middle eastern mindset is either to migrate, work remotely for foreign company or at best get VC, copy foreign startu0p, and try to get some regional market share to be acquired later by western companies.

You can't have a society that produces global unicorns when ahmf of it doesn't have banking, name one country that managed to do this.

Looks to me the issue is with the author's mindset rather than the market.

He wants to build startups to compete on global scale, when half of his country doesn't have a bank account...maybe he is solving the wrong problems..

A VC backable startup by definition has to scale to greater than 12 million people. If you're point is "why doesn't author just start a small business?" then you are seriously missing the point

I know what a VC start-up aim is, that's basic knowledge.

But talent pool is limited and all is being either offshored or using for VC gambling when they clearly have many local problems by the author's assertion.

You seriously missed my point.

Talent pool is not limited, it is a highly educated and tech literate society.

It is a 12 million after all, and you a have a finite number of resources that can be deployed to different problems.

It's not like the US where they can import minds from all over the world and they already boost a high population.

I don't understand the point, nobody is saying that Tunisia's startup scene will rival the US

And I didn't say either. But asserting that the pool is not limited is a false statement, it is limited and small.

My point is that it has finite set and limited resources, that mind resources could be used to solve the many local issues. Instead they are offshored as cheap labor.

The author is pointing fingers and those who try to solve local problems, yet he goes later to say there are tons of local problems and half the country doesn't have bank account.

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