'Too much venture money chasing too few start-ups', says ArabNet founder

Tech start-ups in the Arab world face an unlikely impediment: that of too much venture funding in the market.

That is the view of Omar Christidis, the founder of ArabNet, which organises what is arguably the region's foremost event for digital entrepreneurs.

While there is a lot of money sloshing around to support tech-based ventures, smaller start-ups are missing out, Mr Christidis said.

"In my opinion there is too much venture money chasing too few start-ups. The venture money is [for] deals of half a million, $1 million or more. But there are not that many start-ups that are at that phase," said Mr Christidis.

"What's really lacking is the angel-level funding: the $50,000, $100,000 or $200,000. That's where the gap is. It's harder to find the smaller amounts. When you have a big fund the due diligence process prevents you from being able to do many smaller deals," he added.

As the man behind the ArabNet Digital Summit, due to be held in Beirut at the end of March, Mr Christidis knows a thing or two about start-ups.

The event features competitions for Arab entrepreneurs keen to pitch their ideas to potential investors.

Over 100 start-ups applied to take part in an ArabNet event held in Cairo last year, compared with 70 who went to the annual Beirut festival in 2011.

Previous participants have seen success, said Mr Christidis.

"If you look at our first set of start-ups, from 2010, four out 10 start-ups have since raised funds," he said.

Read The National's interview with ArabNet founder Omar Christidis here.