If the Nile river represents the blood of Egypt, then coral reefs represent its heart.
Generating around USD 7 billion a year from diving and snorkeling-related activities, Egypt’s coral reefs are not just an important source of tourism revenue, but also an important source of life for marine ecosystems; protecting coastlines from storms and erosion, providing habitats and shelter for underwater organisms, and providing essential nutrients for the marine food chain. Globally, over half a billion people across different industries also rely on coral reefs for food, income, and protection.
Entering the vast marine industry market is now no longer limited to large companies, but also young entrepreneurs. Budding entrepreneur Aly Magdy, 28, who is the founder and CEO of Seavo, is one of the few who are rethinking marine electric mobility – a topic that is rarely discussed or advertised in comparison to electric urban mobility.
As the first designer and manufacturer of environmentally friendly watercraft, Seavo’s vision, according to Magdy, is to become the “marine version of Tesla”; to provide an eco-friendly alternative to fuel-based marine products, which are more affordable and more accessible to a wide range of customers. Though it is currently focused on providing products related to water sports, in the long-term, Seavo is working on providing a range of products, such as electric boats and electric sea ships.
The climate crisis is currently turning the world’s eyes on the fragility of marine life and its ecosystem. Coral reef ecosystems are threatened by pollution, unsustainable fishing practices, and rising ocean temperatures that are leading to coral bleaching and physical damage to these ecosystems.
If the current unsustainable conditions persist, Egypt could be losing USD 5.6 billion by 2100 in revenue, according to findings presented by the High Level Panel for a Sustainable Ocean Economy at COP25 in Madrid.
There are several strengths and benefits to electric marine mobility. Though marine transport carries about 80 percent of the world’s commodities, as reported by the United Nations Conference on Trade and Development, marine transport such as ships also produce a huge amount of exhaust gasses and carbon dioxide (CO2). There is also environmental impact from water sports such as boating and jet skiing, which can result in discharge of sewage from boats, high toxicity in the water; and increased pollutant concentrations in aquatic organisms and sediments.
Challenges of being a sustainable entrepreneur
For aspiring sustainable entrepreneurs, there is always the fear of being labeled as ‘too expensive’, a ‘luxury’, or simply being too risky for investment. With little political backing, it can be difficult to convince private investors and customers to resort to sustainable products, even if they are more affordable and efficient.
However, the beginning is usually seen as the main determining factor for success, and in Magdy’s case, it was about gaining enough knowledge and experience to help him later venture into the market on his own.
After completing his bachelor’s degree in mechanical engineering from the American University in Cairo (AUC) in 2016, Magdy became more curious about automation and robotics, which saw him join several projects related to the field as well as teaching robotics in schools and universities. He also joined a company called D-Kemia, which was developing an automated system for the Hepatitis C virus as an innovative solution.
Though the interest in underwater electric mobility rose after he came across the news that seven people had drowned in their attempt to save others from drowning.
“With my experience in robotics, I thought of providing an alternative to this risky operation for lifeguards. In collaboration with the team, we developed a smart marine vehicle, which you can control on the water’s surface and send it to the person without risking your life,” he says.
“But after many years of operations, we found out that people are simply not interested in risky operations and do not want to pay money or invest in a product to save a person’s life. It’s quite sad and tragic, but it’s how the market works.”
To surf ahead of the waves of the market, it is important to be alert and know very well the market’s trends and feedback, he notes.
“After feedback, we realized that people were more interested in using the product for entertainment, such as water sports. Around that time, the Ministry of Environment also began shutting down beaches due to the threats to coral reefs and the pollution coming from fuel-powered boats, despite the fact that beaches are a major source of tourism revenue.”
“This encouraged investors and customers to consider the issue of sustainability more seriously” he adds.
Tapping into the potential of Egypt to become an eco-friendly sea coast and a hub for sustainable tourism, Magdy saw that there was another significant opportunity in the market.
“We noticed that there was a huge gap in the market for electric marine mobility, because there were no competitors. To close the gap, we wanted our products to have an impact on the tourism sector but also popularize electric marine mobility as a lifestyle through entertainment and water sports, which are more commonly used by the public.”
Adapting to every challenge, and every risk, was the key that enabled Magdy to create a sustainable business up to this day. The first challenge was concerned with convincing customers at hotels and resorts to use electric marine products, because changing the mentality of customers can only happen gradually when the products become more mainstream in society.
“One of the most effective ways to convince customers to endorse sustainable products is to push the idea that it’s not just for an environmental benefit, but it is also an economic benefit. We want to raise awareness that there is an economic benefit from using these products, as the cost of electricity is much cheaper than fossil fuels, resulting in a lower operational cost,” he notes.
Being client-oriented is also another key factor, which has helped Seavo to redesign their business model according to customer needs.
“We managed to survive through executing different plans in terms of product development and the business model. After the COVID-19 pandemic, we turned into a service provider rather than just a company that sells a product. Put simply, you no longer have to buy our product or carry any capital or assets, you can simply use our product as a service, and lease it from us and we will share the revenues with you with subscription fees every month,” he explains.
“This way, we made the product more accessible and were able to reach new customers who can now afford the product. Since there is also a worldwide shift towards green products, it has become much easier with customers as they have become more aware of its importance.”
Looking ahead, what’s next for the market?
Electric marine mobility is already making progress in countries such as Sweden, Germany, the Netherlands, and Slovenia. Governments are offering subsidies and funding for infrastructure, which is regarded as an important requisite for the market to grow and expand further.
For Magdy, the growth of the electric mobility industry in Egypt is dependent on the support of the full ecosystem – government, private sector, and customers.
Creating an enabling regulatory environment and removing financial constraints – such as the reduction of taxes for people who endorse and use sustainable products – is important, but equally there is a need to provide support for startups and companies through endorsement by the Ministries of Tourism and Environment, and solving the challenges of having to import raw materials for product development.
The private sector also plays a key role, Magdy says, as there is still a lot of technical know-how that can be learned and gained from companies abroad.
“I believe encouraging private companies and sales manufacturers like Samsung and Panasonic, which are the most famous manufacturers of electric batteries, to establish industries in Egypt will not just benefit us, but also Africa,” he says. It will impact the price of the batteries that we use, and they are coming with their technical know-how, which will benefit the local engineers to gain experience in this industry and organically grow local talent and expertise in this sector.”
Last but not least, Magdy says that the media’s role is indispensable in promoting the use of sustainable products.
“We need the support of the media to raise awareness on why electric mobility is not a luxury anymore, and we are now facing global problems due to carbon emissions, which will affect our economy, our health, and our entire life.”