Living Social nabs GoNabit.
The UAE E-commerce industry has certainly come of age. What was nearly a barren space two years ago is now flooded with exciting new start-ups all keen on cashing in on E-commerce. And there are a number of things that make E-commerce exciting for startups in this part of the world. Firstly, there’s the low set-up costs compared to brick and mortar ventures. It would cost you about ten times as much to open a shop in a major mall in Dubai. Let’s not forget the fact that there are plenty of great Open Source software out on the web that can help you set up an online service for free or at very little cost. Second, there are lesser regulations on the online world compared to traditional commerce. There’s a lot less paperwork involved into setting up an online store and you’re less prone to regular inspection from the authorities if you’re business is entirely online. Third, online penetration in the UAE and the Middle East as a whole is on the rise. Broadband connections are fairly common and a fair amount of people now have a data plan on their mobiles. Finally, the fact that there’s a limited amount of companies offering E-commerce services to the Middle East means that there’s plenty of users online hungry for better online services.
Two years ago when I met GoNabit’s founder Dan Stuart, he was working with UAE’s top recruitment site Bayt.com as Chief Possibility Officer. We were in the process of taking Tbreak commercial at the time and Dan was helping us find a way to better monetize our business. Dan mentioned at the time that he was working on an E-commerce venture. He didn’t say what it was but I could tell it was something exciting. As it turns out it was GoNabit and barely two years since its launch, the site has achieved major success and has been acquired by Living Social, one of GroupOn’s largest competitors.
This is certainly exciting news, not just for Dan but the entire E-commerce industry in the region. It’s a sign that not only is there a viable E-commerce industry in the region but its big enough that global players are starting to take notice. This will probably mean that the tens of emerging GroupOn clones that have emerged lately will probably turn into hundreds as more people try to follow GoNabit’s success. But that’s just good news for consumers who will get better deals.