Yet we have millions of very productive expatriates. Why ? Is it the job type, the salary, culture, what is it that prevents our youth from taking these jobs ??
Yet we have millions of very productive expatriates. Why ? Is it the job type, the salary, culture, what is it that prevents our youth from taking these jobs ??
How I Did It: The CEO of Aramex on Turning a Failed Sale into a Huge Opportunity
by Fadi Ghandour
The Idea: Fadi Ghandour has built one of the most successful entrepreneurial enterprises to emerge from the Arab world, Aramex International, overcoming rejections, cash-flow crises, and naysayers in every country where he tried to do business. Read the Executive Summary
In 1984, two years into building the express delivery company Aramex, I was preparing for the most important meeting I’d ever had. My partner, Bill Kingson, and I were hoping to persuade the Seattle-based Airborne Express to buy 50% of Aramex for $100,000.
At the time, out of a modest office in Amman, Jordan, we had launched several other small offices in the Middle East, hoping to become the first courier company based in that region. Our operations were tiny (we hadn’t yet exceeded $1 million in revenue), I was personally playing a range of roles from chief salesman to occasional delivery guy, and the cash flow was uncomfortably tight. We were what I would describe as a guerrilla setup—a scrappy, hand-to-mouth business.
The Middle East was not yet seen as a growth opportunity for global courier companies: Skirting civil wars and complex political relationships was an enormous logistical and bureaucratic challenge. In addition, in some countries the business market wasn’t yet demanding courier services; in others those services were monopolized by companies or the postal authorities. We thought that such an investment from Airborne, along with the explicit endorsement of one of the world’s most respected logistics companies, could seal the future of our start-up.
Bill and I did get in to meet with both the CEO and the COO of Airborne Express, but they swiftly turned us down. Airborne was just starting to explore expansion outside the U.S. and wasn’t ready to invest in a small market like the Middle East, let alone in a start-up. That was a huge disappointment to Bill and me. But we left the meeting with a valuable consolation prize: the promise of some business. At that time Airborne was occasionally asked to courier packages to various Arab countries; it would use either a competitor or some small London-based company to deliver in the region. Because the Middle East was such an insignificant part of Airborne’s business, there would be little risk in giving those packages to Aramex. But to us it meant the largest and most important account for a long time. Our pitch had been that we could reliably handle whatever business Airborne acquired in the region—so it wouldn’t have to turn to a competitor. We could be a neutral partner, acting on its behalf.
I realized immediately that Airborne’s offer would give us an opportunity to learn from one of the world’s most successful courier companies—and, more crucial, to take advantage of its technology and global reach. Instead of getting a 50% owner, we would get a master class on how to grow our own business. That partnership would make the difference to our survival—and provide us with the rapid learning curve to set our own ambitions high. Nineteen years later, when Airborne was sold to its former archrival, DHL, not only had we learned everything we could from it, but we were ready to be a global leader in our own right.
“We Are Airborne Express…and Federal Express…and…”
Business from Airborne gave us enough credibility to knock on other doors. I realized that the prime competitors in the logistics and courier business feared one another more than they would fear us. So we sold our services as being provided by safe, neutral hands. We would call clients and say, “We are Airborne Express,” or “We are Emery”—whatever company we were representing. We wore many hats and customized our services to suit whoever gave us business. If you looked back at the global offices of some of the major package-delivery companies in the 1980s and 1990s, you’d find some recurring addresses. Those were actually Aramex offices.
After knocking on the door at Federal Express time and time again, we finally gained it as a client in 1987. Aramex thus acquired its single largest account to date, because FedEx had more packages going into the Middle East than all its competitors combined, giving us a healthy monthly infusion of cash.
But our first serious relationship was to be our most significant. Airborne Express started to build a global alliance of regional courier companies like Aramex in order to offer customers service in every corner of the world without having to run or acquire all those operations itself. We were among the first of what would eventually be roughly 40 companies in the alliance—which was called Overseas Express Carriers (OEC)—whose responsibilities included establishing common operating procedures, rates, and quality assurance. Because Airborne provided its package-tracking technology to all its OEC partners, we had an enormous competitive advantage at a very low cost. (We also acquired e-mail early on, achieving a quantum leap in management efficiency.) Previously Aramex had relied on faxes and telex machines for tracking and tracing; we didn’t have the resources or the expertise to create our own system. Suddenly we were part of a sophisticated global operation. We’d been given access to similar systems from FedEx and Emery, but without permission to use them for our own Middle Eastern customers. Airborne’s system elevated us to a whole new level of service.
My comment on this article is that it is too general and the writer does know what is really happening on the ground in the region … bearing in mind that;
Rentier state mentality is the domain of certain groups who got intoxicated by it … solution is a better education system, and showing our youth how to own their future, through entrepreneurship and building their skills for better chances of employability, to liberate them from rent mentality and state dependency
At the end of each year Bertrand Russell comes to mind, a moment of silence to reflect …
Happy New Year
Three passions have governed my life
Three passions have governed my life:
The longings for love, the search for knowledge,
And unbearable pity for the suffering of [humankind].
Love brings ecstasy and relieves loneliness.
In the union of love I have seen
In a mystic miniature the prefiguring vision
Of the heavens that saints and poets have imagined.
With equal passion I have sought knowledge.
I have wished to understand the hearts of [people].
I have wished to know why the stars shine.
Love and knowledge led upwards to the heavens,
But always pity brought me back to earth;
Cries of pain reverberated in my heart
Of children in famine, of victims tortured
And of old people left helpless.
I long to alleviate the evil, but I cannot,
And I too suffer.
This has been my life; I found it worth living.
I posted this piece with my good friends at 7iber …
مسؤوليتنا تجاه البيئة
بقلم: فادي غندور
انطلاقاً من التزامنا بمسؤوليتنا اتجاه جميع شركائنا – بمن فيهم المجتمعات التي ننتمي إليها، وعملائنا، ومساهمينا، وشركائنا التجاريين، وموظفينا – وكنتيجة للتغيرات المناخية المرتبطة بمشاكل الاحتباس الحراري والتلوث البيئي التي شهدها كوكبنا في ال 20 سنة الأخيرة، فإننا نعي حجم التلوث الناتج عن قطاع النقل الذي شكل جزءأ لا يتجزأ من عملياتنا ونلتزم بمسؤوليتنا اتجاه البيئة، حيث تشكل الانبعاثات الغازية الناتجة عن قطاع النقل وحده 14% من نسبة التلوث في العالم. لذلك فقد قمنا بوضع أهدافٍ طموحة على الصعيدين الداخلي والخارجي، للحد من الأثر البيئي لعملياتنا ولترشيد استخدام الطاقة وايجاد مصادر طاقة بديلة.
فعلى الصعيد الداخلي لأرامكس، قمنا بتحويل مركباتنا لتتناسب مع أعلى المعايير العالمية؛ حيث تم تحويل 78% من أسطولنا الى مركبات ذات انبعاثات خفيفية، 44% منها مطابقة للمعيار الاوروبي EURO 4. كما بدأنا في عام 2009 بتحويل مركباتنا للعمل على الغاز الطبيعي أينما توفر في مناطق عملياتنا، كما في مصر والهند، وسنستكمل هذا التحويل خلال الأشهر القادمة. أما في الأردن فقد كناَ أول شركةٍ تستخدم السيارات الهجينة في أسطولها، وبدأ مكتبنا في لبنان بتزويد عملياته بدراجات هجينة لخفض معدلات الانبعاثات الكربونية. وفي الهند فقد بدأنا بتحويل أسطولنا من الدراجات النارية الى دراجات كهربائية ذات انبعاث كربوني يعادل الصفر. ونتيجة لهذه البرامج فقد تمكنا من تخفيض استهلاكنا للوقود لكل شحنة بما يعادل 21%، مما أدى الى تخفيض انبعاث الكربون لكل شحنة بنفس النسبة.
وفي نفس الإطار، وضعنا اجراءات استراتيجية للتقليل من استخدام المواد البلاستيكية في عملياتنا، حيث قمنا باستبدال مغلفات الطرود البلاستيكية بمغلفات مصنعة من مواد عضوية قابلة للتحلل. أما في مجال استهلاكنا للورق ومنتجاته، فقد اتخذنا اجراءات لتقليل وترشيد وتدوير الورق، وقد أدت هذه الإجراءات الى توفير ما يعادل 100 طن من الورق، أي ما يعادل 1,700 شجرة على مدى 3 سنوات.
أما على الصعيد الخارجي، فنحن ندعم ونشجع المبادارات الريادية التي تنشر الوعي البيئي وتحفز على تطبيق الممارسات البيئية الفاعلة. ومن أمثلة هذا الدعم، مشاركة متطوعين من أرامكس ومؤسسة رواد للتنمية في زراعة الأشجار في منطقة المفرق في الأردن، كجزء من فعاليات “أسبوع حبر الأخضر”، أحد نماذج المبادرات الريادية الواعية لأهمية الشراكة المجتمعية للحفاظ على البيئة من خلال التواصل مع أفراد المجتمع عبر الشبكات الاجتماعية على الانترنت.
وفي الختام، نود أن نؤكد على دور كل من القطاع خاص، والحكومات، والأفراد، كلٌ على حدٍ سواء في دعم وتشجيع مثل هذه المبادرات، كما وندعوهم لاتخاذ منحى جديدا تجاه الخيارات والسلوكيات البيئية التي يتبعونها، للتعلم من الأخطاء، والتكيف والتأقلم مع التحديات الجديدة، والالتزام بالمحافظة على البيئة، من أجل العيش والبقاء في هذا العالم.
*المؤسس والرئيس التنفيذي لشركة أرامكس
Saad Khan’s commentary in Forbes is worth reading, I think he is absolutely right, Venture capitalists and angel investors need to be “Talent Scouts” … As an angel investor, I find myself assessing the person more than the idea. It is not to say that the idea is not important but it makes a huge difference who is behind it, his/her character, his/her skill set, his/her passion, his/her world view, his/her team … The idea is important but more importantly it is about who takes it to implementation…it is much easier to come up with ideas and much more difficult to execute… lots of dreamers out there and that is great… but dreamers need to wake up, role up their sleeves, find the tools, find the partners, and get to work to realize their dreams.
Entrepreneurs As The New Asset Class
Saad Khan, 08.18.10, 6:00 AM ET
As a reputed hacker and a serial entrepreneur, Rich Skrenta personifies the kind of person that I love to invest in. He is by most accounts a prodigy–his technical prowess showcased to the world while still in the ninth grade. Early successes in his career include NewHoo (subsequently the Netscape Open Directory) and Topix. Our paths crossed while Rich was still at Topix, and it was instantly clear that his future was infinitely bright. I jumped at the chance to invest when he started Blekko, but the reality is I’m just as excited about what tomorrow will bring.
Enter my new lens on investing: Entrepreneur equity. Specifically, equity in all the commercially productive activities of a person’s career. I want to invest in the innate drive, talent and potential of a person. I want to invest in what they’re working on now, what they’re thinking about next, and whatever they dream up in the future. When it comes to exceptional talent, I’ve stopped worrying about technology, market sizes, product-market fit, etc. I just want to invest before the valuation gets frothy (seed is so 2010).
In case you’re wondering, no, I’m not a feudal overlord. I’m not talking about payday loans and cement boots. In fact, what I’m talking about is not a new idea at all. The concept of making long-term investments on a person’s complete body of work has analogues in many industries. Bowie Bonds (and the further music-backed securities that followed) in 1997 were an example of what can happen when you securitize the intellectual output and associated property rights that span the career of an artist (starting notably with David Bowie and much of his work).
I want a cross between Bowie Bonds and the MacArthur “Genius Award,” the $500,000 grant given by the MacArthur Foundation to exceptional people to work on projects of their choosing. Perhaps a more recent analogue is the social venture Enzi, which is like Kiva for education. They’re finishing up pilots at Stanford University to allow peer-to-peer investments in Stanford international students with financial need. Help pay their tuition and you get a share of their income streams for a fixed period in their future. The first batch of these students has already graduated and is now entering the productive period of the cycle.
Let’s take a test case–Jim Everingham. He was the technical cofounder of LiveOps, and most recently the founder of image monetization platform Pixazza. Both are portfolio companies and repeat bets on people, notably ex-Netscape veterans, Everingham and his team (including hacker-ninja Lloyd Tabb). To date, my firm has had to make multiple discrete investments in both entities, but the reality is those investments were just a proxy for following the career of a prolific talent. If there had been a mechanism to invest directly in Jim (and others in the nexus), I’d be the first to do it and posit that it would be a more accurate reflection of our actual investing behavior.
Venture capitalists, today more than ever, need to be talent scouts. In “Why Entrepreneurs Don’t Need VCs,” I outlined the reasons why the current landscape has fundamentally altered the role of venture capital, and as embryonic investors we have to think in terms of people, not companies. It’s well established that most start-ups pivot multiple times, and the idea we invest in is rarely what the company ultimately does.
More recently, I started to ask the question, if the art of investing is really about identifying great talent early, then lately I feel like I’m working at the wrong abstraction layer. Investing in financials, products, market opportunities, companies, ideas even–these are all second-order consequences of something more basic. I want to invest in the underlying asset. I want to invest in first principles. I want to invest in him (or her).
It seems to me it should be possible to make an equity investment in a person’s future. It can be proscribed for entrepreneurial activities, or it can be structured around future income. The point is to give future entrepreneurs the validation and resources to take chances early in their careers. Imagine the Omar Hamouis and Caterina Fakes that could have been if they just had the flexibility to leave their day job and take a chance.
How does one actually make any of this happen? How do you value entrepreneurs? I hand-wave for now and leave that to wiser folks (like Forbes readers). But I do know where I’d put a couple of these bets. I’ve seen a twinkle in a few eyes lately and I want to double down.
Saad Khan is a partner at venture capital firm CMEA Capital where he leads CMEA’s Web, digital media, and twinkle-stage investments in Pixazza, Blekko and Jobvite. He blogs at SaadWired.com and cmea.com/blog. You can follow him on Twitter @saadventures.
Excellent blog post on the CSR debate by Matthew Bishop and Michael Green in their Philanthrocapitalism blog, http://tinyurl.com/2u5mo3x
I would add that we need to steer away from the concept of giving back, or giving … it is not giving, it is investing, and it is entrepreneurial at the same time. When you invest you expect a return and investing in solving social, environmental and other challenges have a return and a benefit to society at large, so it is part and parcel of the entrepreneurial mind of finding solution, innovating, and expecting a return. Except here the return is of no immediate financial benefit, but it will certainly have a long term indirect fiancial benefit. Case in point; investing in education. A generation from now you will have an educated society that is productive, with more opportunities. Returns and impact might take a very long time, our current social ailments are complex and need patient investing.
I wrote this a year ago, I think it is worth sharing again
While the global media was racing to cover the biggest story yet about entrepreneurship in the Arab world, while the story itself was hitting the sixth top spot on Twitter, a feat never before achieved by an Arab event, while the regional online community was abuzz with the news, the Arab mainstream media, with a few telling exceptions, was snoozing through it all.
Yahoo!, the global Internet portal and search engine, acquires Maktoob, the largest Arabic portal, in a landmark deal that speaks volumes about Arab entrepreneurship, and our media was just not interested because, well, it was clueless.
So, for these snoozers, here are a few clues about why this acquisition is such a big deal.
It finally puts us Arabs on the global Internet map. It will get people to pay attention to this region’s knowledge-based industry, where there is an impressive number of technology entrepreneurs.
It is the ultimate success story in a region long used to failure. For our younger generations, it is a wonderful example of how a dream can turn into a brilliant achievement through a combination of boundless creativity and down-to-earth business sense.
For our leaders, it is hopefully a painful reminder of the distance between their priorities and the ambitions of an increasingly wired younger generation (16.5 million of whom are unique visitors of Maktoob’s) eager to move away from a state-driven, oil-dominated future.
For our wealthy Arab investors, it is a wakeup call that true value lies in our youth rather than in real estate, and that talent is closer to home than they could have ever imagined.
For the Arab world, it is proof that money may count for something but, in the final analysis, an education, smarts and determination count for much more, because the two entrepreneurial gentlemen who made Maktoob started out in Jordan – their home and, it just so happens, one of our area’s more resource-poor countries – and, even when their company reached way beyond it, never left.
We should, therefore, celebrate the story of Maktoob, and we should hail its founders, Samih Toukan and Hussam Khoury, for being such tenacious entrepreneurs, at once innovative, patient and practical. But before the acquisition becomes yesterday’s news, as an early investor in Maktoob, as a friend of Samih and Hussam’s and, yes, as an occasional mentor to both, I would like to share with you the lessons learned from this experience.
Lesson 1: It is not about vision; it is about a tedious process of discovery. It is about a unique product at the right time for the right geography. Maktoob started as a consulting company, then changed to become one of the first (if not the first) Arab website developers, and then moved on to inventing Arabic web email. They saw the niche and they went all the way, building everything around that niche.
Lesson 2: Conserve your cash. There is nothing more important for your survival than cash. Cash burn is not something to be proud of, so burn the least amount possible. That means founders should not take salaries as long as the business cannot afford them. Maktoob lived off bread crumbs for the longest time; they kept developing the business until the first venture investor came.
Lesson 3: Don’t fall for the hype. When Maktoob happened, cash burn was the fashion, but Samih and Hussam kept their eyes on the company, did not become seduced by sexy trends and kept building value. None of their much richer competitors survived the dotcom crash. Maktoob flourished.
Lesson 4: Build your team. This is a no brainer, but few entrepreneurs realize that it is always about your team no matter how good you are. Build the team, retain it, reward it with stock and give it freedom to innovate.
Lesson 5: Mentors are important, so listen to them and seek them out all the time. They will always give you a different perspective, challenge you and keep you on your toes. Dig deep into their knowledge: It is priceless.
Lesson 6: Aim for success not exits. Two decades of building a business is a long time. Samih and Hussam knew the exit will come only with a good brand and a viable business.
Lesson 7: Your shareholding percentage does not matter. What matters is building value for your clients, and the rewards will not be too far behind. The value of your business is what you build, and how much you own is relative to that value. It is about how to get to the exit in dollar terms, not the percentage you own; 50 percent of $10 million is half of 10 percent of $100 million.
Lesson 8: Partner with your venture and PE capital investors. Set the terms of reference early on to make sure that they understand your business and leave you alone to run it. Abraaj and Tiger understood that, and Samih and Hussam were left to build value. All equity partners made lots of money because they understood this basic rule.
Lesson 9: Split your responsibilities very clearly and very early on. The combination of Samih and Hussam as a team, as friends and as partners is unique. I don’t know anyone that had the ability to split responsibilities the way they did – and with a smile.
Lesson 10: When exiting or negotiating with someone like Yahoo, keep your eye on the ball, don’t get arrogant and keep someone to run the business in case of a no go. When Samih was on the road Hussam kept the engines greased and running.