For a hugely popular Lebanese-founded company, Woopra has had almost no success in the Middle East. The real-time web analytics company – which provides analysis of customer behavior on websites as well as aggregate numbers of visitors – has over 200,000 global users to its free service, while its premium service has 3,000 companies registered, each paying up to $30,000 a month. But of those 3,000, founder Elie Khoury estimates that fewer than 10 are from the Middle East.
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“We have customers all over the world – Japan, Sweden, Germany and of course the US, [which makes up] around 40 percent of our revenue, [but] the Middle East is our weakest spot.”
The reason, he says, is that technology trends in the region, such as e-commerce and online tech startups, are years behind the rest of the world. As such the service they provide, which gives companies the ability to track in-depth their customers’ actions online and even interact with them live, is still not really understood. “Whatever they are doing in the Middle East right now, they were doing in the Bay Area [of San Francisco] like four or five years ago,” he says. “As a market size the Middle East is not very appealing for us – there are far fewer companies, [companies are] much less educated and it takes a long time to close a sale with them. We would rather skip it for now.”
It is perhaps admirable, then, that Khoury and co-founder Jad Younan made such a strong effort to remain in Lebanon despite the lack of business opportunities. Ultimately, however, they found that the lack of talented Lebanese in the technical sectors made the move to America inevitable. “I was always trying to keep Woopra in Lebanon. Not many companies manage to run a global B2B business from Lebanon. We tried everything possible with the resources that were available,” he says. “If we managed to hire the right developers I think we could have definitely left an office in Lebanon.” Perhaps, he jokes, the “Lebanese people are not made to be techies.”
So it was that in January 2012, five years after setting the company up in the northern Lebanese town of Byblos, Woopra moved its entire operations to Silicon Valley, San Francisco. The company has grown rapidly, being tipped by e-week as the top analytics company to watch out for and increasing its staff to 15. Though its share of the market remains small, with Google Analytics the dominant force, the remarkably accurate real-time service it provides has enabled the company to carve out a niche in an incredibly competitive field.
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Despite this, Woopra has yet to turn a profit, a fact that Khoury is perhaps surprisingly proud of. “The second [we] become profitable, [we] hire more people to grow faster. What we are pushing to do is to stay breaking even at any point in time. As we grow the revenue we hire more people and add more expenses to the company. But we are not at a stage where we can be profitable – I wouldn’t let this happen!”
Khoury willingly admits that the company is still battling against the odds, referring to their ‘bootstrapping’ – meaning a keeping costs low to become self-sustainable without external help. But he enjoys the thrill of trying to compete in the most competitive tech environment in the world. “Honestly until now Woopra is still bootstrapping, we have done a couple of rounds of funding – we didn’t raise a lot of money. But we are still able to compete on the global level by just bootstrapping.”
Yet this small fish, big pond situation may change if they get the investment he wants. Later in the year the company aims to work on a major financing package. Khoury refuses to give specific details of the amount they expect to raise but described it as their “first mega round of funding, raising the money here in the Bay Area.”
Pining for home?
What then, of Lebanon. When Executive first interviewed Khoury back in 2008, he bemoaned the lack of support for entrepreneurs in the Middle East, saying “our universities are generally producing employees, instead of creating long-term inspirational projects.” Does he still feel that way? Yes and no.
“Some of the colleges in Lebanon are now more aware at this, [for example] the American University of Beirut now has an entrepreneurship center. Back in 2007 I remember when I was graduating if you said to anybody you wanted to build a tech company, they would look at you in a weird way. One of my professors even said ‘do you really want to compete with Google or YouTube?’”
Now, Khoury argues, there has been such a buzz around entrepreneurship in the Middle East in recent years that the problem is not lack of capital for entrepreneurs but of good ideas. “In my opinion looking at the scene there is more money than potential successful startups,” he says. “You need a better education system, you need mentorship, we have started seeing development but it is still not good enough.”
What, then, would his advice be for budding Lebanese entrepreneurs, either in the tech sector or outside. “I want people to stay in Lebanon and bootstrap the way we did. We stayed in Lebanon for four or five years building a world-class product… I think people should work on building prototypes, proving themselves – especially as first-time entrepreneurs.”