Yahoo acquires Maktoob: the Jordanians did it!

25/8/2009

Maktoob acquired by Yahoo

As all eyes were on Dubai in the past hour to follow the official news of Yahoo’s acquisition of Maktoob.com, my mind wandered to an old stone house near Amman’s 2nd Circle, which, for over a decade was the ‘house of Maktoob’, and the birthplace of what is now the biggest success story of the Arab internet to date.

Husam Khoury and Samih Toukan Husam and Samih in front of the old Maktoob House in Jabal Amman. In the end, it was the Jordanians who did it. The first Arab portal acquired by a global internet players is Maktoob, a company started in Jordan, by Jordanians (who of course were joined by Arabs of various nationalities, as the company grew). This story was long in the making. Maktoob was founded in 1997, was bought and sold by various investors over the years. The rumors about an acquisition have been swirling for years. The Arab internet is very late to the part indeed, but it is quite thrilling, nonetheless, that it was a Jordanian-founded company that now stands as the first example of an Arab internet portal able to attract the interest of a global internet brand.

In the mid 1990′s, when all of us first generation Arab internet entrepreneurs were young and foolish (and had more hair) it must have seemed totally outlandish to start a business on the “internet”. At that time, most people in Amman had first heard of the internet through a badly subtitled American TV documentary, aired on the local station.

Starting an internet business during those early internet days (early even by global standards), in a market where essentially no one had access to the internet can only be explained by geeky enthusiasm of 20-somethings and, I may add, a healthy exposure of Jordanians to the wonders of pre-internet tech entrepreneurship.

In 1995, I was part of the team that started BYTE Middle East, the Arabic edition of the famous tech journal. At the same time and in the same office, I also was witness (and first designer) of the birth of Arabia On Line at the hand of Khaldoon Tabaza, who both brought BYTE to the region and was already browsing the net before anybody in Jordan knew what the internet was. He also managed to interview Bill Gates for a cover story of BYTE.

Our email connection to the world was being provided by NETS, another early pioneer of the Jordanian internet market. Imad Ayoub and Marwan Juma are two names that come to mind here. The first Jordanian email connection was established from Amman to the dorm room of one of those guys’ brother, who was studying in the USA! Email was gathered in the NETS office in Amman and then sent, twice daily to the US.

As we were designing some of the early websites in the region, we also started hearing of another web design and development firm, called Business Optimization Consultants (BOC) who where also getting involved in the tiny internet market (although their name sounded more like a management consulting firm!). The guys at BOC, Samih Toukan and Husam Khoury then invented one of the first ways to write Arabic emails on the internet. So, they launched the first Arabic email service. They called it Maktoob. The rest is history.

Remember, all of this was happening BEFORE the turn of the century and before the official Jordanian push for IT which only happened after 2000.

It’s been a long road from the startups of the mid 1990s to today’s deal. Maybe too long, in fact. And a shrewd, cold hearted business person might say that all the people who insisted on being web entrepreneurs would have done better financially had they concentrated on buying and selling land in Amman.

It is also worth investigating what percentage of shares the original entrepreneurs behind Maktoob managed to hold onto before the acquisition, knowing that many investors successively bought and sold the company.

But while selling land and real estate is the more proven and accepted path for making money in Jordan, the only way for REAL progress for this country is the investment in technology and knowledge, not just in IT, but also in agriculture, publishing, design, engineering, architecture and so on.

And although the road may have been long for a company like Maktoob, we also have to acknowledge that, in Jordan, we have an interesting, even unique, environment that combines just about enough intellectual freedom, entrepreneurship, global exposure and local rootedness that makes tech startups possible. In Dubai, your fate is to be a salesman. It is a trading place. In Jordan, you have the option of starting your own little thing based on your knowledge or skill and hope for making a life for yourself and your family.

The Yahoo-Maktoob deal is great news for any tech entrepreneur in Arabia. But it should be a great motivator for us in Jordan. Let’s hope it is also a motivator to investors to open their eyes, even if just a little bit, to the fact that investing in ideas and technical know-how is an option (instead of just investing in land or shopping malls). It is great that Samih Toukan, after selling Maktoob, is continuing with the development of his group’s other internet assets, such as CashU, Souq.com and Araby.com, under the new name Jabbar. This deal is not the finish line for the Arab internet industry. It is merely the beginning.

Jabbar internet group

8 Comments

  1. Ahmed our dear friend over the years, reading your article made me reminisce and recall the good old days… Indeed no other candidate can succinctly narrate Maktoob’s (originally BOC) story other than a branding guru like your good-self.

    Ahmed, Jordan appreciates you! Amman appreciates you!… Maktoob-Yahoo! appreciates you :-)

  2. Muhammad says:

    Very interesting and inspiring story, I’m very optimistic about Jordan being the center of web technology, art and design in the Arab world.

    I’m only disappointed that Jabbar’s logo
    worths only $39.

  3. Husam USA says:

    Congratulations for this success and we hope that you want stop there and we need to have a reversed investment tools to pull the west investments to our region, by time we have someone have the initiative and the drive to believe in their dreams.

    In the near future I’m looking to launch an idea that should have an impact and i will do it from my homeland Jordan.

    Respectfully yours

  4. Moe says:

    Hi,

    Sorry for being the only one here to look negatively on this, but if Maktoob was successful why sell it? And why is selling it considered a success story? is it for the “Investment”? What is the profit when all of us knows that when a company buys a company (or part of it). Layoffs become the main subject.

    Again sorry for being negative but it would have been a success story if Maktoob was on the “Best of” list, not the “part of” list.

    Regards,

  5. Moe says:

    I Just have been informed that Jabbar has layed off a number of employees???!!!!! if the sell was successfull why are they doing this? (a big question mark)

  6. [...] A bleak picture? Perhaps. Some people call me a pessimist when I describe the Arab web landscape as I just did. A successful global web entrepreneur I recently met at the European web conference LeWeb was even skeptical about the investment opportunities in the Arab web. While we all have been enthusiastic about the Maktoob-Yahoo deal (rightly so, of course) it is still a lonely example of a major investment. Other regions, like south America (let’s forget China and India for a moment) are offering investors a much more vibrant market. [...]

  7. [...] Nashef heeft met zijn Israelische partner, de ervaren investeerder Yadin Kaufman, daarom het Middle East Venture Capital Fund opgericht waarin de Europese Investeringsbank al 5 miljoen Euro heeft geïnvesteerd. Nashef en Kaufman willen in twaalf tot vijftien Palestijnse bedrijven binnen vijf jaar ongeveer drie miljoen dollar per bedrijf investeren. Voorbeeld voor Nashef is de deal van vorig jaar waarbij Yahoo in Jordanië voor ongeveer 100 miljoen dollar de Arabische portal Maktoob kocht. Ook technologiegigant Intel investeerde al in twee Jordaanse bedrijven. De verwachtingen zijn hooggespannen, zoals ook blijkt uit de site van de Palestijnse branchevereniging en de Palestijnse incubator. [...]

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