Improving access to Open Data in the UAE would give startups in the country the knowledge and tools they need to validate their business ideas and enhance their competitive edge, according to a new whitepaper released by Dubai Chamber of Commerce and Industry.
The whitepaper, entitled Validating a Startup Business Idea and published in collaboration with global strategy consulting firm Roland Berger, highlights the importance of market research and due diligence for startups to ensure the viability of their offerings and enhance their competitive edge.
Market validation was identified as one of the most commonly faced challenges by startups in the UAE. Often the case, startups in the country launch a business before determining whether their products or services serve a market need. The findings showed that 27% of difficulties faced by UAE startups resulted from a lack of a market need, while 46% of surveyed entrepreneurs noted that the availability of industry and market data remains a key obstacle to their success.
The whitepaper reported a direct correlation between a country’s position on the World Bank’s Open Data Index and their position on the organisation’s Ease of Doing Business Index, with the findings reflecting a country’s “start-up friendliness.”
The paper referenced a Deloitte Analytics whitepaper that indicated that 49 countries now have more than 220 official or unofficial open data websites that provide downloadable public datasets at a national, local, city and district level, with the list led by the United Kingdom, the United States and Canada.
Recommendations and best practices
The whitepaper encouraged private companies and government entities to share a wider number of datasets at a more granular level, enable education and training for startups on the utilisation of data and facilitate partnerships between start-ups and government agencies, corporates and other institutions to reach potential customers for product testing.
Global best practices and case studies have shown that startups in developed markets are not only relying on available data for market validation but have government data as part of their core business model. A key criterion for investors in evaluating the potential of a startup is the size of the market or scale of the problem that it aims to address, a fact that demonstrates the importance for startups to fully understand how to estimate the relevant market size and its underlying growth drivers.
Validating a startup business idea is the third whitepaper conducted by Dubai Chamber as part of Dubai Startup Hub’s Entrepreneurship Advocacy series examining key issues faced by the UAE’s startup community, including banking and funding challenges.
Dubai Chamber launched Dubai Startup Hub in 2016 as an online platform to connect startups, entrepreneurs, developers, venture capitalists and students, enabling them to learn about new opportunities and create new partnerships that stimulate economic growth.
Source: Dubai Chamber