When Morten Lund, the co-founder of Skype, came to Dubai in 2004 seeking support for the internet phone service from UAE telecoms officials, he was turned away in a taxi and given a one-way business class flight back to Denmark. Now he is back to launch a new business venture, and this time the officials are listening.
Coders Trust is a micro-financing company that is aimed at freelancers and students in emerging markets who want to upgrade their programming skills. The company provides loans to students to take courses and charges a 10 per cent commission from their freelance fees in return.
Mr Lund, the chairman of Coders Trust, and its founder Ferdinand Kjærulff chose Dubai to announce the launch of the company.
The two are targeting sovereign wealth funds in the region to help finance their operations. Coders Trust is already close to closing a “small round of funding of a couple of millions of dollars” before it embarks on local partnerships, said Mr Lund.
“We are talking to educational institutions, microfinance companies as well as investors in the technology space. What we find interesting in the Middle East is the huge potential in terms of youth. What everyone is telling us is the lack of education which is the problem for companies in recruiting talent,” said Mr Kjærulff.
Skype, which was bought by Microsoft for US$8.5 billion in 2011, is no longer blocked in the UAE but voice over internet protocol (VoIP) services are not authorised by the regulator TRA unless provided by the main operators du and Etisalat, whose revenues and traditional business models have been disrupted by VoIP.
Coders Trust’s first project will be in Dhaka, Bangladesh, which accounts for some 12 per cent of the total market of freelancers worldwide. The company has the backing of the Danish government and is currently working with Grameen Bank in Bangladesh. It is aiming to have 5,000 students using its service within the first 18 months.
“I don’t believe you can save the world by hugging trees and doing yoga. We are a business, we will give them [students] a mentor and cash to get there,” said Mr Lund.
By providing them with the tools to attain new skills – from data entry to advanced coding – Coders Trust will empower students in remote areas around the world to generate an income.
“We are here to engage with the local start-up community and have a discussion on how to work together. We’ve been talking about Syrian refugees in Jordan that are currently highly educated, but have no access to the labour market. Doing a project for them would really be a symbol of the potential of the business model,” added Mr Kjærulff.
According to a report by McKinsey and Company, online freelance portals will create more than 150 million jobs by 2025. Freelance portals such as Odesk, Elance and Freelancer already have close to 20 million registered users.
Speaking about the local digital start-up sector in the Middle East, Mr Lund said that the talent is here, but investors are too concerned with a “local angle”.
“Investors here always want a local angle and I think that is wrong. In my opinion it is dangerous to do something with a local angle. Start-ups on the internet should be global [because] the internet is global and the competition is global,” said Mr Lund.
thamid@thenational.ae
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