Algerian Entrepreneur Takes Venture to a Higher Level at WSU

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Feb, 1 2013

Algerian entrepreneur takes venture to a higher level at WSU

For most Americans, life without e-commerce seems unfathomable, but in Algeria, cash transactions are the rule – not the exception. The North African nation has traditionally maintained a cash-based society, but that may change soon thanks to the innovation of a young Algerian entrepreneur and his recent experience at Wayne State University.

Youghourta Benali, who returned to Algeria at the middle of December, spent the Fall 2012 semester at Wayne State as one of three recipients of the NAPEO TechTown Incubation Prize, an award of the North Africa Partnership for Economic Opportunity. Along with an entrepreneur from Tunisia and another from Morocco, Benali received complimentary business incubation at TechTown, Wayne State’s research and technology park and business incubator, as well as educational services at the university.

Launched three years ago, NAPEO is a private-public partnership of U.S. and North African business and civic leaders, entrepreneurs and governments that fosters economic development and cooperation between the two regions. Benali, who spoke to an audience of WSU staff and students about his experience on Dec. 12 in the David Adamany Undergraduate Library, personified the objective of the partnership as he discussed the assistance he received from Blackstone LaunchPad, Wayne State’s entrepreneurship lab, in refining his business plan and pitching his ideas to investors in Detroit, New York and California.

“My business plan changed a lot,” Benali said. “I discovered mistakes and how to correct them. I met a lot of entrepreneurs, and I learned from each of them how to improve my ideas. And the choice of Detroit as a city for incubation was great, because I see people building up parts of the city from scratch, and this is a similar situation to what is occurring in Algeria.”

But NAPEO’s goal of engagement was also realized by Benali’s exposure to the United States, he said.

“I didn’t just develop my business plan, I made friends, discovered American culture, spent Thanksgiving with an American family, and worked on my English,” he said.

Phones as commercial conduits

Benali is the founder of Walletix, which takes advantage of Algeria’s well-established mobile phone infrastructure to provide Algerians with an inexpensive way to make purchases without cash. For Algerians wishing to make an online purchase, Benali said, the current practice is to wire money to the retailer “and wait.” Given that Algerians don’t use debit or credit cards, and that “more Algerians have mobile phones than bank accounts,”  Benali launched Walletix to provide the country with an interim electronic payment solution, he said.

As conceived, Walletix, which is slated for launch this spring, will use phone numbers as identification numbers that can be used to transfer money from Walletix accounts maintained by each phone’s owner to a point of purchase. A Walletix customer wishing to make a purchase will use his or her phone to text a transaction code identifying the purchase place and amount to Walletix, which in turn will transfer money from the customer’s private account to the retailer. Customer’s accounts will be supplied by prepaid money cards, which will honor the preference of Algerians to avoid buying items on credit.

Benali believes Algeria’s e-commerce sector is his to conquer. He has met with information technology officials in Algeria, he said, who have encouraged his venture and assured him he will not run afoul of regulation.

“They said, ‘Get working on it and we’ll catch up,’” Benali said.

Benali said the guidance he received on his business plan at Wayne State has given him confidence that he can grow his business without fear of copy cats or competitors.

“What’s important is not the idea,” Benali said, “it’s how to execute the idea.”