Bahrain's Pitch For Start-Up Success

Since the launch of Bahrain's Labour Fund 12 years ago, and as part of Bahrain's continued move to diversify its economy, the government of Bahrain has placed considerable emphasis on the development of a digital, knowledge-based economy, focusing on SMEs and start-ups as well as seeking to empower eager Bahrain based millennials.

This vision of sustainable development has resulted in a continued raft of holistic legislative changes and developments and initiatives aimed at diversifying means of funding, streamlining administrative procedures, the ease of doing business, and fostering electronic transactions. These include Bahrain taking to the cloud in preparation for the regional boom in data storage and cloud computing - the community initiative bears the name 'Start-Up Bahrain' whereby investors, incubators, entrepreneurs, academic institutions and the Government have come together to help start-ups realize the full potential and gain attainable from the Gulf marketplace. Bahrain has also implemented a regulatory sandbox as a framework and process to facilitate and encourage the development of digital technology. This article sets out some of the key initiatives and changes being implemented in Bahrain to encourage the start-up, scale-up and SME sectors in the country.

The SME Directorate

The Ministry of Industry, Commerce and Tourism has taken the initiative of establishing the SME Directorate (the 'Directorate'), with the task of addressing the stumbling blocks currently facing SMEs in Bahrain, and proposing enabling legislation to assist the development of the sector.

The Directorate has categorized SME companies as per the number of employees and generated revenue in a move that defines the status of each start-up. Note that SMEs form 90% of registered businesses in Bahrain.

Category (Business size)

No. of Employees

Total revenue in BHD (per annum)

Micro

1-5

1- 50,000

Small

6-50

50,001- 1,000,000

Medium

51-100

1,000,001- 3,000,000

The Directorate understands that most SMEs are transforming their ideas into 'protectable' concepts. In a move that demonstrates a modern perspective of appreciating intangible assets, the Directorate is said to be liaising with Bahrain's banking community in pursuit of considering start-up intellectual property as a means for securing much needed loans.

Start-up and Scale-up Incubation and Acceleration Centres

Adhering to the demands of key players in the start-up scene, and closely aligned with the said...