Beyond Unicorns: Why the Future of Tech in Emerging Markets May Lie in Startups + SMEs

A bold rethink of the startup-only model sparks a hybrid narrative better suited for regions like MENA.

Introduction

“Are startups alone capable of solving deep-rooted, structural problems?”

That’s the million-dollar question Wassl poses in a recent LinkedIn post that challenges the prevailing obsession with startups in emerging markets. Rather than romanticizing the unicorn dream, the post dares to explore whether hybrid startup SME model—those that pair the innovation of startups with the stability of SMEs—might offer a more grounded path forward for the MENA region and other similar ecosystems.

Background & Context

Wassl, a platform known for curating insights on tech, venture, and entrepreneurship in emerging markets, dropped a sharp perspective piece titled:
“The Future of Tech in Emerging Markets: Are Startups Enough?”

The post comes at a time when the startup ecosystem in MENA is both booming with record funding rounds and grappling with sustainability challenges. While startups bring speed, agility, and disruption, many struggle with scaling infrastructure, cash flow discipline, or retaining operational talent.

SMEs, on the other hand, are often underleveraged in innovation discussions despite representing the backbone of local economies.

Wassl’s thesis: Why not combine both? The hybrid startup SME model offers a solution that balances the strengths of both approaches.

Key Takeaways from the Post

The Limits of the Startup-Only Model
Startups, though valuable, may be too risky, volatile, or narrowly focused to solve systemic challenges—especially in sectors like healthcare, logistics, and education. The hybrid startup SME model offers a way to address these limitations by integrating the stability of SMEs.

The Case for Hybrid Models
Wassl explores how startups could partner with SMEs—using the former’s agility and tech capabilities and the latter’s distribution power, local market knowledge, and credibility—to scale impact responsibly. The hybrid startup SME model could become the driving force for sustainable business growth in emerging markets.

Local Innovation Requires Local Context
Instead of copying Silicon Valley blueprints, emerging markets need tech narratives rooted in local infrastructure, labor dynamics, and policy frameworks. The hybrid startup SME model is pitched as more adaptable and durable, offering a solution that’s better aligned with the region’s needs.

Real-World Momentum Is Already Building
The post notes early signs of this shift already underway in the MENA region, where incubators, policy frameworks, and VC firms are beginning to value sustainable growth over blitzscaling. The hybrid startup SME model is gaining traction as a more feasible long-term solution.

Community Reaction

While no specific comments are highlighted in the post itself, the underlying message clearly resonates. It echoes what many regional founders, investors, and policymakers have been whispering for years: speed alone is not the goal—resilience is. Expect further discussions around how SME integration into tech ecosystems could reshape accelerators, grant models, and procurement policies, especially within the hybrid startup SME model.

Our Perspective

From a legal and business development standpoint, the hybrid startup SME model opens new strategic and contractual horizons:

• Joint ventures between startups and SMEs will require clear IP ownership terms, profit-sharing structures, and governance frameworks.
• Startup policies might need revisions to include SME collaborators in tax incentives, incubator programs, and investor protections.
• It also brings implications for mergers, acquisitions, and equity swaps, especially if founders begin sharing growth equity with SME operators.

In short, this model requires new contract templates, new thinking, and new stakeholder alignment—all of which legal advisors must be ready to navigate.

Call to Reflection

If the West builds unicorns, what should we build in emerging markets? What if instead of chasing speed, we prioritized scale + sustainability—together, through a hybrid startup SME model?

Click here to view LinkedIn post