ISSUE 60
ISSUE 60
LETTING PEOPLE AND TECHNOLOGY CREATE THE FUTURE
The firm’s success can be attributed to investing in people and technology. – Philippe Ghanem, CEO and Vice Chairman of ADS Securities
LETTING PEOPLE AND TECHNOLOGY
CREATE THE FUTURE INSIDE
Wearable art (pg 16) Assisting GCC job seekers (pg 42) FME 60 cover.indd 1 Co resized.indd 1 Comprehensive Leasing
21/05/2017 16:10
P16
P42 9/24/17 12:54 PM
AS EASY AS GCC! THE TAXMAN IS COMING… AND that taxman could be you!
VAT – As Easy As GCC! is a special supplement to be published by CPI Financial with a long-term shelf life as a handy reference guide. of businesses facing the introduction of new tax rules.
HI-IMPACT SOCIAL MEDIA SOLUTIONS FROM CPI FINANCIAL
Omer Hussain | Sales Director Nikhil Mathur | Business Development Manager - Finance ME
CPI Financial FZ LLC • PO Box 502491 Al Shatha Tower, Office 1209 Dubai Media City, Dubai, U.A.E. Tel: +971 (0) 4 391 4681 • Fax: +971 (0) 4 390 9576 • www.cpifinancial.net
FME 60 cover.indd 2
9/24/17 12:54 PM
H
ello and welcome to the latest issue of FinanceME. This is a particularly special issue because many of the interviews with Bahraini business owners and financial bodies contained herein are as the result of a threeday trip to the Kingdom, courtesy of the Bahrain Economic Development Board (EDB). Since FinanceME caters to the SME sector across the GCC, this opportunity allowed us to see the business landscape in Bahrain first-hand, and it was truly enlightening. HE Khalid Al Rumaihi, Chief Executive, Bahrain Economic Development Board (EDB) sat down with us and explained ambitions for Bahrain to become the fintech hub of the Middle East, and touches on future financing plans for SMEs. Areije Al Shakar, Vice President and Deputy Head of Development Services, Bahrain Development Bank (BDB) elaborates on the role the banking sector plays in supporting smaller businesses, and you can read more in our Country Focus (Pg 22). To learn more about setting up a business in Bahrain, we spoke to Brian Howard, Partner, Trowers and Hamlins for our Legal Focus section (Pg 14) who took us through the changes and updates made to legislation and the availability of different online portals to expedite the registration processes, all of which support and encourage entrepreneurship in the Kingdom. The Government is also focused on developing regional companies that have an established presence in the Kingdom. We visited the Mondalēz plant in the Bahrain Investment Industrial Park (BIIP) where Plant Director Mohamed Shalaby, took us through the company’s expansion plans to become the manufacturing and logistics hub for the region (Pg 34). Closer to home, the UAE VAT implementation date of 1 January 2018 is around the corner and FinanceME and Female Fusion recently held a panel to answer questions by female business owners as to how their businesses could be affected (Pg 12). Companies can register online from mid-September, though further details from the Federal Tax Authority (FTA) are awaited.
30
42 48
I hope you enjoy this issue!
Read my blog at: http://www.cpifinancial.net/blog/author/112/jessicacombes Follow us on Twitter: @FinanceMidEast and on Instagram: @finance_middle_east
p03-04_Contents.indd 3
WWW.CPIFINANCIAL.NET
LOG ON TO WWW.FINANCEMIDDLEEAST.NET FOR NEWS, POLLS, EVENTS, ANALYSIS, BLOGS, FEATURES, COMMENTARY AND MORE.
06
3 9/19/17 9:41 AM
PUBLISHED BY
5
NEWS ANALYSIS CBB releases new crowdfunding regulations
6
FAST FACTS Saudi Arabia prepares to launch forum to support SMEs
22
COUNTRY FOCUS Sandbox clever
26
RISK MANAGEMENT Risky business
30
PITCHING TO INVESTORS Pitch perfect
8
TOP TIPS Five ways to turn stragglers into stars
34
CASE STUDY Oreo you ready?
10
VAT WATCH GCC VAT–update
38
FACE TIME Safe in the clouds
VAT WATCH FinanceME and Female Fusion talk VAT
12
14
LEGAL FOCUS SMEs, Bahrain, and the law
16
CHALK TALK Nada Alawi
18
Chairman SALEH F. AL AKRABI C45 • M35 • Y30 • K100
Chief Executive Officer ROBIN AMLÔT robin@cpifinancial.net Tel: +971 4 391 4681 Managing Editor GEORGINA ENZER georgina@cpifinancial.net Tel: +971 4 391 3728 Sales Director OMER HUSSAIN omer@cpifinancial.net Tel: +971 4 391 5419
BRAND Crazy for Kooples
Editors JESSICA COMBES jessica@cpifinancial.net Tel: +971 4 364 2024
42
START-UP All for one!
WILLIAM MULLALLY william@cpifinancial.net Tel: +971 4 391 3718
44
AWARDS FinanceME Business Vision Awards
NABILAH ANNUAR nabilah.annuar@ cpifinancial.net Tel: +971 4 391 3726
SIMON MOTWALI simon.motwali@cpifinancial.net +971 4 4335321
48
BEHIND THE SCENES Sheikha Reem Al Khalifa
MATT AMLÔT matt@cpifinancial.net Tel: +971 4 391 3716
MOHAMED MAKSOUD mohamed@cpifinancial.net Tel: +971 4 391 5320
50
LAST WORD Spinning plates
London Bureau ISLA MACFARLANE isla@cpifinancial.net Tel: +44 7857 429476
DANIEL BATEMAN daniel@cpifinancial.net Tel: +971 4 375 2526
40
CEO CHAT Letting people and technology create the future
C7 • M30 • Y80 • K40 PANTONE 871 C
Get the next issue of FinanceME before it is published. Full details at www.financemiddleeast.net
Chief Designer BUENAVENTURA R. JALUAG, JR. jun@cpifinancial.net Senior Designer FLORANTE MAGSAKAY florante@cpifinancial.net
ISSUE 60
ISSUE 60
LETTING PEOPLE AND TECHNOLOGY CREATE THE FUTURE
The firm’s success can be attributed to investing in people and technology.
Advertising sales@cpifinancial.net Business Development Managers NIKHIL NIDHAN nikhil@cpifinancial.net Tel: +971 4 391 3717
Data Analyst NADINE ABOUZEID nadine@cpifinancial.net Finance Manager SHAIS MEMON, ACCA, CMA shais.memon@cpifinancial.net +971 4 3913727
Creative Designer ANA MAKSIĆ ana@cpifinancial.net
Database Administrator RIZZA RECTO INFANTE rizza@cpifinancial.net Tel: +971 4 391 4682
Online Content Manager SIYA PAINAYIL siya@cpifinancial.net Tel: +971 4 391 3722
Administrative Assistant CAROL C. ROSALES carol@cpifinancial.net Tel: +971 4 391 3709
– Philippe Ghanem, CEO and Vice Chairman of ADS Securities
Administration & Subscriptions enquiries@cpifinancial.net Tel: +971 4 391 4682 Tel: +971 4 391 3709
LETTING PEOPLE AND TECHNOLOGY ISSUE 59
CREATE THE FUTURE ISSUE 59
INSIDE
Wearable art (pg 16) Assisting GCC job seekers (pg 42)
MAKING GAINS
P16
P42
Overall, we feel GAIN Capital is well positioned to extend our market share globally in the coming year, which includes our continued commitment to serving traders across the Middle East region. – Glenn Stevens, Chief Executive Officer, GAIN Capital
MAKING
GAINS
INSIDE
Accessing your lawyer online (pg 14) Focusing on female health (pg 44) FME 59 cover.indd 1 bleed guide.indd 1
17/04/2017 14:58
4 p03-04_Contents.indd 4
P14
P44 6/28/17 3:58 PM
Head Office P.O. Box 502491, Dubai Media City Dubai, UAE Fax: +971 4 390 9576 WWW.CPIFINANCIAL.NET Registered at the Dubai Media City Traffic Media FZ LLC, Dubai, UAE © 2017 CPI Financial FZ LLC All rights reserved. No part of this publication may be reproduced or used in any form of advertising without prior permission in writing from the Managing Editor.
9/24/17 10:47 AM
NEWS ANALYSIS
CBB releases new crowdfunding regulations
T
he Central Bank of Bahrain released a series of regulations pertaining to both conventional and Shari’ahcompliant financing-based crowdfunding businesses. At the end of August 2017 it was announced that small and medium-sized businesses in Bahrain and the GCC region will be eligible to raise conventional or Shari’ah-compliant financing through crowdfunding. In the case of SMEs based outside the Kingdom the platform operators have to clearly mention any cross-border and jurisdictional risk financiers have to take, said David Parker, Executive Director of Financial Services–Bahrain Economic Development Board (EDB). “Crowdfunding offers bespoke opportunities for investors and helps grow innovative solutions and empower SMEs and start-ups. This has an impact on supporting Bahrain’s overall fintech ecosystem. Ultimately, innovation serves as the backbone to overall economic growth,” added Parker. Firms operating an electronic financing or lending platform must be licenced in Bahrain under the CBB Rulebook Volume 5: Financing Based Crowdfunding Platform Operator. General regulations are the same for both conventional and Shari’ah-compliant financing based crowdfunding platforms. To ensure that the Islamic financing structure is Shari’ah compliant, a Shari’ah advisor should be brought on board or this function should be outsourced to a third party.
The most important points of the framework include, but are not limited to: crowdfunding platform operators must meet the minimum capital requirement of BHD 50,000; only person-to-business (P2B) lending is permitted; SMEs with paid up capital not exceeding BHD 250,000 can raise funds through crowdfunding platforms; the onus is on lenders to perform their own creditworthiness assessment on borrowers; and crowdfunding platform operators have to comply with the CBB rules on anti-money laundering, combating financing of terrorism, and consumer protection. Furthermore, only expert and accredited investors are allowed to provide financing through these platforms and they can lend up to 10 per cent of their net assets to a single borrower, and sign a self-declaration form to this effect. Retail investors are not permitted to participate given the high-risk nature. Platform operators are obliged to clearly and publicly disclose their fees, charges and commissions, and they may provide financing to borrowers who use the platform subject to obtaining the required licence from the CBB to provide credit and adequate disclosure. These regulations place a heavy emphasis on consumer protection. If a borrower is unable to raise at least 80 per cent of its crowdfunding offer size, the attempt would be considered unsuccessful and any monies received
would have to be refunded within seven calendar days. A borrower can also only raise a maximum of BHD 100,000 through crowdfunding in a year; the financing tenor should not exceed five years. “We expect Bahraini entrepreneurs to benefit from the global crowdfunding trend, which provides a viable alternative to bank financing. In particular, the CBB is keen to see Bahrain dominate the Shari’ah-compliant financing-based crowdfunding market in the region. The demand for Shari’ah compliant financing is already high and we expect to see it reflected in the crowdfunding market as well,” said Khalid Hamad, Executive Director at the CBB. The announcement about the new regulations came two weeks after the Dubai Financial Services Authority (DFSA) introduced its regulations that will help small and medium enterprises and startups to raise funds through crowdfunding. The Bahrain Government has announced a series of measures to consolidate it its position as a regional financial hub, including the introduction of a regulatory sandbox to facilitate fintech initiatives, and the issuance of loan-based crowdfunding directives. These developments will support entrepreneurship and further promote the establishment of small businesses and fintech institutions in the Kingdom, added Parker. It is expected that equity-based crowdfunding regulations will be announced soon.
WWW.FINANCEMIDDLEEAST.NET WWW.CPIFINANCIAL.NET
p05_News.indd 5
SHUTTERSTOCK.COM/ALPHASPIRIT
CBB releases new crowdfunding regulations
5 9/24/17 11:11 AM
SHUTTERSTOCK.COM/BY DRUID007
FACTS
Mohammed Bin Rashid Fund (MBRF), the financial arm of Dubai SME has appointed Metis Management Consultancy to conduct post-fund monitoring services for companies supported by the Fund. The partnership will grant SMEs, assisted by MBRF, greater access to hands-on experience from the highlyskilled consultancy team, which will include routine checks, guidance, and financial advisory support that will help in planning for potential risks. “Public-private partnerships are critical to the strategy of Dubai SME and the Mohammed Bin Rashid Fund to empower entrepreneurs and their startups in their growth and evolution. We are delighted to have Metis Management Consultancy as our partners and together we look forward to SMEs supported by the Fund to stay different, pursue innovations, and grow sustainably,” said Saeed Matar Al Marri, Deputy CEO of Dubai SME and Director of MBRF. The fund provides three loan schemes to SMEs: Credit Bank, Seed Capital Loan, and Invoice/LPO Finance. Metis will represent the MBRF with all the SMEs they fund, and will handle all the post-fund monitoring operations and report back to the Fund.
SHUTTERSTOCK.COM/ABZ
METIS MANAGEMENT CONSULTANCY TO MONITOR SMES POST-FUND
OMANI APP ENCOURAGES ECOMMERCE ENTREPRENEURS Brawaz, meaning browse, was designed by a group of students from Sultan Qaboos University who wanted to create a convenient trading environment that is easy for the commercial movement in the Sultanate. The app aims to eliminate the high rent burdens of physical premises. The app offers a number of features such as a delivery service, a facility to allow daily promotion, an option to communicate with customers, and payments. Owners of small and medium enterprises can rent and open an eshop within the large electronic centre by a monthly rent that is less prohibitive than current market rents. “We welcome all those who are motivated to open their own shop on this application and to enter into a competitive and encouraging business environment,” said Mohammed Al Mawali, the CEO of Brawaz. The company ran its campaign in Muscat Grand Mall and Souq Rashid in Al-Mabelah and intends to set up stations in other centres and commercial gatherings in the future.
SAUDI ARABIA PREPARES TO LAUNCH FORUM TO SUPPORT SMES SME General Authority (Monsha’at) has launched an interactive forum (BIBAN) at the Riyadh Exhibition and Convention centre from 17 to 20 September 2017. The forum was designed to overcome challenges faced by the SME sector including regulations, legislations and the ability to achieve efficient management of funds. “The BIBAN conference aims to raise the community awareness of the importance of innovation and creativity for entrepreneurship as well as to create a nurturing environment and the technical infrastructure to support competitiveness among SMEs,” said Dr. Ghassan al-Sulaiman, Governor of the General Authority for Small and Medium Enterprises. He added that the SME sector represents 99.2 per cent of the total business in Saudi Arabia and the conference will focus on the available investments opportunities, taking into the consideration the local market’s current and future needs. BIBAN highlighted successful models in the community to support young entrepreneurs, who have an idea but do not know where to start, to understand the regulations and learn how to obtain tools to support their operations and administrative and technical solutions.
6 p06-07_Fast Facts.indd 6
9/24/17 12:57 PM
SHUTTERSTOCK.COM/237
DFSA LAUNCHES CROWDFUNDING FRAMEWORK
WNNA IS TOP AT ‘SEEDSTARS GCC’ IN BAHRAIN Bahraini start-up WNNA, a site designed to provide personalised recommendations based on a user’s location and preferences, will represent the GCC in Switzerland at the annual Seedstars Summit. Co-Founded by former Microsoft employee, Ali Mohsen, the team stands a chance to receive up to $1 million in equity investment. WNNA beat out 15 of the GCC’s best seed-stage start-ups from Saudi Arabia, Bahrain and Oman at the ‘Seedstars GCC’ event in Manama, Bahrain on 9 September. In order to pitch at the event, the selected companies had to be less than two years old, have raised less than $500,000 in funding, and have built a minimum viable product, ideally with existing traction. To provide local entrepreneurs with this opportunity and in the effort to deliver the best possible event, Seedstars World is in partnership with CH9, a Bahraini business accelerator. “The number of talented entrepreneurs in this region is phenomenal, and CH9 would like to help these entrepreneurs gain visibility in and out of this market,” said Mohamed Altawash, founder and managing director of CH9. Seedstars Summit 2018 will be held in Lausanne, Switzerland on 12 April.
The Dubai Financial Services Authority (DFSA) has launched its regulatory framework for loan and investmentbased crowdfunding platforms. This framework is expected to catalyse growth in the financial technology (fintech) industry in the UAE and the GCC region, by targeting the specific requirements of crowdfunding platforms. Global loan-based crowdfunding is forecast to reach more than $300 billion and global equity-based crowdfunding more than $93 billion by 2020. “We are pleased to be the first in the GCC region to formalise a tailored regime for loan and investment crowdfunding platforms, which represent an increasingly important source of financing for the SME sector. By creating a clear set of rules for operators, we hope to encourage the sustainable development of this industry and is part of our contribution to the UAE Government strategy to develop the SME sector,” said Ian Johnston, Chief Executive at the DFSA. The UAE government has an ambition to enhance the contribution and performance of the SME sector. It has taken a major role in establishing initiatives and programmes to help with sources of funding for SMEs. Initiatives include the Mohammed Bin Rashid Establishment for SME Development and the Khalifa Fund. Given the significant role that SMEs play in the UAE economy, crowdfunding is expected to grow further in importance in the UAE as entrepreneurs seek alternative sources of funding.
FAST FACTS
SHUTTERSTOCK.COM/THEONE
S IN BAHRAIN SME
421,257 EMPLOYED BY PEOPLE
52,918
BAHRAINIS EMPLOYED BY SMES
28%
SME CONTRIBUTION TO BAHRAIN GDP
35%
SME PROJECTED GDP CONTRIBUTION IN 2018
70%
BAHRAINIS WANT TO BE ENTREPRENEURS
Source: EY
WWW.FINANCEMIDDLEEAST.NET
p06-07_Fast Facts.indd 7
7 9/24/17 12:57 PM
TEST REAL SKILLS
TOP TIPS
During the interview process, candidates should be investigated for their creativity, common sense, problem-solving ability, curiosity, leadership skills and adaptability. Emotional intelligence, people skills and outstanding personalities are far more valuable than academic qualifications. A start-up should not look for someone who is extremely specialised and great on paper, but rather seek out employees who have the ability to be flexible in any diverse situations, even if the employee has not experienced that type of role before.
Top five recruiting tips Rohan Nathan of Nathan & Nathan HR tackles considerations start-ups should make when building their teams
SECOND OPINIONS
It is a good idea for any start-up to have a second opinion from someone who is not vested in the business. This can sometimes highlight aspects of the candidate that may not have been identified in the first interview. Start-ups should try to interview potential candidates more than once, gaining a second opinion of an individual could prove invaluable.
ADVERTISING THE JOB
Thoroughly vetting job boards to see what jobs are being advertised will help determine which platform is right for the business. Over listing on multiple platforms will draw undesirable applications, and overburden your HR team with screening. There are a variety of paid and free job boards that have millions of candidates registered on them, each with their own unique candidate mix. Take the time to select one that that is right for you.
8 p08_Top Tips.indd 8
SHARING COMPANY VISION
Start-ups should take the time out to decide the long-term strategy and vision for the company. This will act as your guide to hiring the right people that will contribute to achieving that vision. In addition to this, a set of specific goals can provide clarity to your employees and is a valuable tool in boosting morale as goals are achieved.
STAR CANDIDATES
Companies are often wooed by employees who have stellar track records at larger corporates that they previously worked for. Such star candidates may not be able to replicate their performance. Understanding the circumstances under which that employee achieved success is important when determining whether they can do it at your business. Carefully evaluate the strengths of a candidate, and select one whose approach will be compatible with your requirements.
9/18/17 5:10 PM
Monday 27th November 2017 | Godolphin Ballroom | Jumeirah Emirates Towers
Knowledge partner
Supported by
Organized by
To register your interest in attending, please visit out website, drop us an email or give us a call.
www.wealtharabia2017.net p08_Top Tips.indd 9
events@wealtharabia.net
+971 4 391 4682 9/18/17 5:10 PM
VAT WATCH
GCC VAT-update
Following the publication of the UAE Tax Procedures Law, online VAT registration will open mid-September 2017
GCC draft n of nt in 017. be tive cted VAT and for
deral oved s as ated
t on and on. sued e,
SHUTTERSTOCK.COM/DUNCAN ANDISON
e of lling also ns of yers,
The Tax Procedures Law
VAT Audits
• Any person conducting any type of business to keep accounting records and commercial books, as well as any tax-related information for five years. • Records must include: annual accounts, general ledger, purchase ledger (including supplier invoices and payments), and sales ledger (including sales invoices and receipts). • For VAT purposes, Excel is not acceptable. • Tax returns, data, information, records and documents must be submitted to the Authority in Arabic. The Federal Tax Authority (FTA) may accept documents in any other language, if they provide a translated copy into Arabic at their expense if so requested. • Any person obliged to register for VAT must do so and must include their Tax Registration Number (TRN) in all correspondence and transactions with the Authority or with others. • Each registered entity must also prepare and submit a tax return for each tax period for which they are registered. Source: Federal Law No. (7) of 2017 for Tax Procedures
• The FTA may perform a tax audit on any person to determine compliance with the provisions of the relevant laws, at its office or the place of business of the person (or any other place where they conduct business, store goods or keep records). The person must be given five business days’ notice. • The auditor may ask for original records or copies thereof, and take samples of goods, equipment or other assets available at the person’s place of business. • An audit will be conducted during the official working hours of the Authority. The Director General may issue a decision to conduct the audit outside regular hours if necessary. • The Authority may order a re-audit if new information surfaces that might impact the outcome of the tax audit. • The audited person has the right to: request to see the tax auditor’s identification cards; obtain a copy of the tax audit notification; attend the auditing procedures that take place outside of the authority’s headquarters; and obtain copies of any original paper or digital documents removed or
obtained by the FTA during the audit. Source: Federal Law No. (7) of 2017 for Tax Procedures
Online registration • The registration with the FTA for tax purposes will begin in mid-September. • The registration will be conducted through e-services on the FTA’s website. • The registration will commence first for blue-chip companies and companies that produce and import excise goods. • Any person obliged to register for VAT but fails to do so will face penalties. Source: HE Khalid Ali Al Bustani, DirectorGeneral of Federal Tax Authority
Registration • Mandatory registration threshold: AED 375,000. • Voluntary registration threshold: at least AED 187,500. • Voluntary in Q3 and compulsory in Q4. • Documents required: ID, passport, trade licence, bank account information, articles of association • Rules for Free zones have not yet been released. Source: Federal Tax Authority
10 p10_Vat.indd 10
9/24/17 11:30 AM
bleed
WWW.FINANCEMIDDLEEAST.NET
p10_Vat.indd bleed guide.indd11 1
11 9/18/17 5:11 PM 19/07/2017 09:20
VAT WATCH
financeme
and Female Fusion talk VAT Accounting and legal experts address certain issues to help business owners prepare for VAT’s implementation on 1 January 2018
C
urrently the mandatory threshold for VAT registration is AED 375,000 per annum, and the voluntary registration threshold is AED 187,500 per annum. One of the main questions faced by SMEs owners is if they fall below these thresholds, should they even bother to register for VAT? The panel of the first FinanceME and Female Fusion discussion series for female business owners was unanimous that it is advisable to register for VAT, regardless of the size of the business. Even if a business falls below the mandatory, or even the voluntary, threshold, it is worth registering for VAT for two reasons: all business owners want their businesses to grow and to surpass the threshold; and that Phase 1 of the registration process has voluntary registration but in Phase 2 it will be mandatory for all businesses to register, said Simran Samtani, Co-Founder & Senior Partner with Xcel Accounting. “SME owners should register even if they think they fall below the threshold; if the authorities find out taxes that should have been paid have not been, that is a serious offence that comes with its own penalties,”
said Bianca Gracias, General Counsel, Suits Advisors. Penalties include 500 per cent of the outstanding VAT amount due, the business can be shut down immediately for a period of 72 hours, and the owner can face criminal charges and imprisonment. Even if a business is not eligible to pay VAT, up to date and accurate records have to be kept in the event of an audit to prove no evasion is taking place. The FTA can audit any business at any time and can do so after giving the business five days’ notice. A company will not be able to avoid paying VAT by invoicing and collecting payment in 2017. “If a business has been paid in advance, that payment is not taken directly; it is put on the balance sheet and then as the good or service is delivered as part of that contract, the VAT invoice is raised and VAT is accounted for,” said Lisa Martin, Founder, The Counting House.
VAT AND CONTRACTS Of the 60 or so attendees, the majority in the room showed an interest when the question was raised about how retainer contracts will be affected if
they were signed in 2017 and continue into 2018. Gracias advised having clients sign an addendum to the contract which states that from 1 January, VAT will be charged. With online registration opening in mid-September, and January’s implementation date around the corner business owners should start getting these addenda signed now. If a business owner is currently setting up agreements that are going to be open-ended, Gracias advised adding a clause that says ‘all applicable taxes’ will be charged to and paid by the person paying the invoice, because excise tax is due to be introduced soon and it is unknown what taxes could be introduced in the future. “If a business starts invoicing after 1 January and VAT has not been specified on the invoice, the law says that the business will have to account for VAT and it will be assumed that any money received will include VAT. Therefore business revenue will go down by that five per cent because the business is liable to pay that VAT amount over. Ignorance of the law is no excuse for not putting that clause in, and a business cannot escape VAT,” added Martin.
12 p12-13_VAT.indd 12
9/24/17 11:37 AM
SHUTTERSTOCK.COM/JUAN NEL
While While business business owners owners wait wait for for further further details details on on VAT VAT from from the the UAE UAE Government, Government, they they can can still still set set up up their their accounting accounting processes. processes.
With cash flow management being an ongoing challenge for SMEs, members of the panel discussed recovering bad debts and dispute resolution. According to the Dubai Chamber if an SME has already paid VAT on a an invoice–where they have a clause in the contract saying VAT will be charged for that service–the business owner has to wait for six months to see if they can recover that money. During that time they have to write it off in their accounts. When raising a dispute, Gracias said, “Think of the number 20. You can make a claim directly from the FTA from the date the claim arises, within 20 days. The FTA has 20 days to review your dispute and come back to you. If you are not happy with their decision, you have 20 days to submit the issue to the Tax Disputes Resolution Committee which is still to be set up. This committee will consist of three members: one from the judiciary and two tax experts. They will issue the resolution within 20 days although they have the option to extend their deliberation for a further 20 days. If you are still unhappy with the resolution, the claim can be taken
before the competent courts in Dubai, but only if the dispute is for a minimum amount of AED 100,000.” During her presentation Martin advised the audience that until the Government publishes a notification to the contrary, for the time being all goods and services should be considered VAT rated. However, certain healthcare and education services and supply of relevant goods and services will be zero rated and further information on the distinction is awaited. To date no specific rules or regulations are in place for SMEs, freelancers, or entrepreneurs; no rules have been announced pertaining to free-zone based companies. The first session of a female-led panel series addressed questions on VAT set to be implemented on 1 January 2018, following the Federal Tax Authority’s (FTA) announcement that online registration will open in mid-September 2017. While the finer details of the UAE VAT law remain unclear, further information from the Government is expected over the next few weeks. Panellists for the event were Simran Samtani, Co-Founder & Senior
Partner with Xcel Accounting; Lisa Martin, Founder, The Counting House; Bianca Gracias, General Counsel, Suits Advisors; and Shannon Rogers, Associate, Bird & Bird, and the event was moderated by Jessica Combes, Editor of CPI Financial’s FinanceME.
KEY TAKEAWAYS
- SMEs should implement proper accounting procedures for record keeping–any business can be spot audited by the FTA. - No information is available regarding VAT liability for free zone companies, though companies should still start preparing their accounting records to be VAT compliant. - Addenda saying that VAT will be charged from 1 January 2018 should be added to existing contracts. - New contracts should include a clause that ‘all applicable taxes’ will be charged. - VAT cannot be avoided by receiving payment in 2017. - Ignorance of the law will not excuse tax evasion and severe penalties will be incurred by a guilty party.
Source: Lisa Martin, Founder, The Counting House; Simran Samtani, Co-Founder & Senior Partner with Xcel Accounting; Bianca Gracias, General Counsel, Suits Advisors; and Shannon Rogers, Associate, Bird & Bird
WWW.FINANCEMIDDLEEAST.NET
p12-13_VAT.indd 13
13 9/24/17 11:37 AM
LEGAL FOCUS
SMEs, Bahrain, and the law Brian Howard discusses the reality of setting up a business in Bahrain
I
t is incredibly easy to establish a company in Bahrain–even an onshore company, and the process just keeps getting easier, according to Brian Howard, Partner at Bahraini law firm Trowers and Hamlins. This ease of registration can largely be attributed to SIJILAT, Bahrain’s online registration portal. “A business owner can get their commercial registration number without having completed all the necessary documentation. This opens doors to a number of other business activities that may need to be done as a company, such as leasing premises, or acquiring different licences and permits. They cannot conduct business until the full company registration is completed, but within an hour or two, a small business owner can start to do preparatory work on their business,” said Howard. In 2016 the Commercial Companies Law was overhauled which saw an improvement in certain processes, such as capital reduction. If a business owner has expended their capital, in order to be able to pay out profits to shareholders, that capital
needs to be regenerated. In the case of an entrepreneurial business where the initial capital has been lost but the business has turned around, the business owner can restructure the capital reduction, without experiencing a very long creditor objection process. Where a business owner previously had to wait for 60 days it now only takes 15 days. There was a fundamental revision to the labour law in Bahrain in 2012. Previously the balance had been considerably more in favour of employees. The Labour Law Number 36 of 2012 (the New Labour Law) in Bahrain repealed previous labour legislation, and established improved working standards, wider protections, and faster dispute resolution procedures. The New Labour Law now provides adequate protection for both employers and employees. The law provides the option of unilateral termination to employers where necessary, while anti-discrimination clauses are available protect workers from any mistreatment. Howard added that the New Labour Law provides more certainty regarding
the costs of shrinking a workforce, which is particularly important for SME owners. The law sets out with absolute certainty what employee entitlements are, and once those are met, the issue is settled. “In terms of a general business environment it’s always been conducive, from a lawyer’s perspective, to have commercial certainty in terms of the law and the civil code. We know where we stand if anything is documented in a contract and it highly likely that it will be enforceable. It is only in rare circumstances where the law will dictate what the parties are trying to agree will not be effective. We have courts that are sophisticated enough to determine low value disputes as well multi-billion dollar disputes, and we have confidence in that system, which makes a lawyer’s job in Bahrain much easier,” said Howard. The Labour Market Regulatory Authority (LMRA) has also improved the visa process considerably–the prices of visas have been reduced and the process of obtaining work permits has become much easier. The LMRA also offers business owners the
14 p14-15_Legal focus.indd 14
9/18/17 5:15 PM
People are able to register companies within affordable budgets, and they can secure their own visas and residency permits, which I think is essential for an SME.” –Brian Howard, Partner, Trowers and Hamlins
convenience of an online portal where they can access a number of e-services. Expatriate employees can check their work permit application status, as well as the legal status and validity of their work permits in Kingdom of Bahrain. There are a number of Government bodies and financial institutions offering support to Bahraini SMEs by way of financing and mentorship but the Government has also updated its bankruptcy law. It was announced at the end of August that a draft law concerning bankruptcy has been completed. The new bill aims to replace the 1987 Bankruptcy and Composition Law. The Ministry of Industry, Commerce and Tourism studied similar laws implemented in Singapore, UK, US and neighbouring countries, such as the newly implemented Federal Decree Law No. 9 of 2016 on Bankruptcy in the UAE, to provide more flexibility to business owners in capital restructuring. “We hope the new bankruptcy law will be released this year and we expect that it will include a new regime for Chapter 11 processes, the equivalent of the US which will allow entrepreneurs
to fail but regroup, reorganise, and then be successful, and that is vital. It will not be the end of a business if it hasn’t initially worked out the way the business owner wanted it to. They will get the opportunity, under the protection of the law, to negotiate with their creditors, to come up with a solution, get a sanctioned plan, and then work from there,” said Howard.
SMES ON THE RISE Howard said that owing to the low capital requirements to start a business in the Kingdom, a number of amendments and improvements to the Commercial Register Law and the Commercial Companies Law, and the ease of registration offered by SIJILAT the number of commercial registrations has increased three-fold. In 2015 there were approximately 9,130 commercial registrations; in 2016 it was around 31,600. “People are able to register companies within affordable budgets, and they can secure their own visas and residency permits, which I think is essential for an SME. They are able to access the market with their product or service, secure in the knowledge
that they are operating under their own visa,” said Howard. SME support in Bahrain is very good. There are a number of initiatives under the Industry of Commerce and Tourism, the Bahrain Economic Development Board (EDB), the Bahrain Development Bank (BDB) have set up a frame work to attract entrepreneurs but also to develop the entrepreneurial spirit of the Bahraini population. “There is a young generation of people that is very keen. They see what’s happening in Silicon Valley in the US or Silicon Roundabout in London. Previously, setting up a company required a substantial amount of capital, but you could set up a company like Facebook with limited capital,” said Howard. These young people, the millennial generation, have the knowledge that they are being supported by the registration process, along with financial support and incentives from governing bodies. They believe if they have a good idea and a business plan for the idea, then there are no barriers to making that idea a successful reality, Howard added.
WWW.FINANCEMIDDLEEAST.NET
p14-15_Legal focus.indd 15
15 9/18/17 5:15 PM
CHALK TALK
NADA ALAWI The Founder of Annada found a way to combine of love of art and silk scarves I am a Bahraini national. I went to a government school and at that time we had science or literature streams–I chose science. I got a scholarship to the University of Bahrain but I studied in the US, in Houston, Texas. My first job was market research in an oil and gas-related company. I was the only Arab woman. I could call all the GCC
countries and get their surveys done on the phone. I think I did very well for my age at the time. When I left towards the end of my MBA I was in my early 20s. My father said he was thinking of starting an occupational health and safety company, because that was his field when he was working in the
Ministry of Labour. He saw that they were enforcing agency but there was nobody helping the private sector to be compliant. I returned to Bahrain in September 2004 and began work in October that year. I started that company with my dad and we were partners. It was the right time for us to
16 p16-17_ChalkTalk.indd 16
9/24/17 11:39 AM
I am the series of experiences and decisions I have made in my life." – Nada Alawi, Founder, Annada
create the company and have that kind of entity because there was a construction boom in Bahrain–the financial harbour was being built and so were the high-rise towers, and there weren’t proper laws to accommodate that. The company grew and we started accepting work in different countries around the world. We basically went to the end of the world; we even had a project in Russia. I started painting in 2008. I met other artists; I enjoyed seeing their technique and their excitement and passion. There is something very special watching an artist put a painting together; it’s just pure love. They’re not angry, they’re not in a hurry, they are in this zone and they create beauty and they pour their feelings onto the canvas. I just love that outlet and I was just happy to be part of that world. In 2011 it was a bit of a dark period. I was terribly bored. I was invited to a conference for entrepreneurship in China by Entrepreneurs Organisation (EO) and I could not go to China purely for this conference. While I was there I wanted to research a project of some kind. At the time I was obsessed with Hermes and their scarves and every six months I’d go and select a scarf and in my head my love of art and these scarves started coming together. The entrepreneur in me always wanted to do something with art. I wanted something that was relatively simple and something I could use as an artistic outlet. I have this
philosophy about accessories–you can be very simple, but accessorise. Accessorising is what makes you and your outfit stand out and pop. When this idea came together, it was a lightbulb moment. I went to this artist I was learning to paint with and I think I talked at 500 words per minute and I told him my idea. I do not know how much he got out of it; I think I was just so excited he just said, ‘Wow, just do it’. I left the company I started with my father in 2012. At that time Tamkeen [semi-governmental organisation in Bahrain] was giving out 80 per cent support grants on marketing. I was able to create a complete brand in the beginning, on 80 per cent funding. It was like creating a company almost for free. I just had to pay for my own production; everything else was available and facilitated for me to start. I decided to launch during Jewellery Arabia because when you go to the jewellery show every year it gets more expensive. Consumers still want to leave with something, why not a scarf? Every artwork we selected has a story behind it. Every scarf has a name. The different kinds of artwork look like they belong together. Even though the artwork is very different, there is a theme; it’s happy art. I think we’ve worked with 25 plus artists and around 270 artworks. We started with silk scarves; today we offer silk, cashmere, wool and cotton. We expanded into paper products,
leather products, and apparel. The silk products are made in China; the leather is manufactured in Turkey. The abayas and paper products are made in Bahrain. Our winter scarves are made in Kashmir, India. Everything we use is a natural fibre so it feels good when you wear it. The reason we started with a square scarf was because it kind of looked like a painting. So in my head it was an immediate transition. I’m so grateful to do this; I get to do whatever my heart desires. I’ve made a lot of friends in this business; they’re funny, they’re successful, they’re around my age, they have the same values, the same love of life and travel. I am the series of experiences and decisions I have made in my life. Nobody can fully understand what is in your head until you present it. Having an idea is so easy, but it’s the patience of execution that pulls it off. Outsiders look at the end result and they think that you came across the idea, not that you really worked hard to make it look this way. Having that assistance from Tamkeen allowed me to create the foundation for a worldclass brand. It is not ‘crafty’. We benchmarked against Hermes. Of course, our brand does not look like their brand, but when we looked at quality and finish, that was the baseline standard. Having that kind of support from the beginning allowed us to achieve that standard from the start.
WWW.FINANCEMIDDLEEAST.NET
p16-17_ChalkTalk.indd 17
17 9/24/17 11:39 AM
CEO CHAT
The future of financial services will be driven by technology and people, and we want to be a leader in both these areas.� – Philippe Ghanem, CEO and Vice Chairman of ADS Securities
18 p18-21_CEO Chat.indd 18
9/18/17 5:21 PM
LETTING PEOPLE AND TECHNOLOGY
CREATE THE FUTURE Philippe Ghanem, CEO and Vice Chairman of ADS Securities, sees great potential for the UAE
What market need did ADS Securities fill? Launched in 2010, ADS Securities has grown from a few people in a borrowed office to an internationally recognised financial services company. It came to the market as a challenger brand. It was always a very ambitious company with a new approach and a belief that it could change the way the international financial services market operated. The founders recognised that there was a period of time each day when trading in the Far East was tailing off, and to the West the main European markets were just coming online. This gap left a trading window when liquidity was weak and spreads widened, creating systemic risk, which financial firms hate. A new market was needed to generate trading and attract new liquidity at this point in the trading day. The obvious location for this solution is in an area which sits between Asia and Europe–the Middle East. When we set up, we wanted to bring new liquidity to the markets, bridging flows from Hong Kong and Singapore through to London, removing this risk. I had run investment firms in the region and also knew that if I wanted to place a trade, and get good pricing, I needed to do this through one of the main markets. I could not do it locally. ADS Securities was founded in response to those needs.
The firm was founded with a very high initial level of capital, $400 million, far more than was required, but this gave the company the ability enter into partnership with global brands and offer a secure trading solution. I am aware that not all companies have this level of backing available, but it is advisable that these companies, where they have exposure to risk, do not cut corners. If you do not have the right capital you put your company, and the money of the people who invest with you, at risk. The firm is regulated by the Central Bank of the UAE, as well as in the UK through the Financial Conduct Authority (FCA), and in Hong Kong with the Securities and Futures Commission (SFC). It was important to have a national regulator sitting behind it as trading, by its nature, is international. In many of the jurisdictions ADS was in, working regulation was light-touch, and clients were prepared to trade with counter parties, our competitors, who were taking on huge levels of risk. ADS viewed this as unsustainable. What advice would you give smaller businesses, with limited capital, to survive challenging circumstances such as the financial crisis? I am often asked about the financial crisis and how we managed to build
and grow a company in the middle of a global decline. The challenge is not what happened in the past, it is how financial markets will change in the future. For ADS Securities, the focus is on how technology will completely revolutionise our industry and the way in which we integrate the best people with the latest in automated trading. ADS Securities was launched when many firms were still finding out how bad the global financial crisis was going to be. The firm’s success can be attributed to investing in people and technology. The growth and development of the firm, from the outside, may have been seamless. But we had to take hard decisions and act to align ourselves to a fast-moving and dynamic market. From its outset ADS Securities invested in its trading technology, risk management systems and client interfaces. Its OREX platform with its mobile application are recognised as state-of-the-art in the industry, and it is one of the first trading platforms to be designed and built in the region. If we believe that the way forward is artificial intelligence (AI) and the systems being developed today are just the tip of the iceberg, it makes no sense to outsource our future to an independent developer. We need to be part of the process, to pass on our market knowledge and insights, to help cont. overleaf
WWW.FINANCEMIDDLEEAST.NET
p18-21_CEO Chat.indd 19
19 9/24/17 11:42 AM
CEO CHAT cont. from pg. 19
frame the next generation AI trading and asset management systems. What is the effect of the investment advice that you give individuals on the businesses they are in or run? ADS Securities’ investment banking team now works with public sector and government organisations, large corporations and financial institutions. They have a growing network of influencers and implement growth-
based investment strategies through advisory services, M&A, private placements, pre-IPO placements and seed capital opportunities. Having put Abu Dhabi onto the global financial map, a large number of clients approached ADS looking for a wider range of investment products, including asset management and wealth management. Well-respected investors and companies wanted to work with ADS
because it provided sophisticated trading solutions from the region. UAE and Middle Eastern firms no longer had to wait for London or New York to open; they could trade a range of products direct into the market using ADS Securities. This has always been a unique selling point (USP) for the firm and has led to a number of smaller trading firms setting up in Abu Dhabi to take advantage of ADS’s global market access.
20 p18-21_CEO Chat.indd 20
9/18/17 5:21 PM
SHUTTERSTOCK.COM/ ATSTOCK PRODUCTIONS
ADS Securities invests just as much in the right people as they do in the right technology.
From its start, trading over the counter (OTC) products, ADS Securities has now established a successful asset management division which has exclusive relationships with flagship international funds and has developed a proprietary managed accounts platform. This year a Type 6 trading licence in Hong Kong has been added to our Abu Dhabi Global Market licence, which will require
part of the firm to move to the new financial centre based on Al Maryah Island in Abu Dhabi. Did ADS Securities face any unexpected challenges and how were they addressed? Part of ADS Securities business is based around currency trading, and many business people will be aware of the Swiss National Bank de-pegging itself from the euro in 2013. This caused the market to crash and a number of large brokerages failed. The impact of this event is still being felt in the markets today. Less liquidity is available and companies are much more risk averse. There have also been major changes to regulations, including the implementation of directives such as MiFID II (Markets in Financial Instruments Directive II). This is the second version of the MiFID to improve the functioning of financial markets in light of the financial crisis and to strengthen investor protection. The response has been that firms are invested in technology, for trading, for risk management and increasingly for AI-based financial systems. If people need to be reminded of how quickly the financial services world is changing, they only need to look at cryptocurrencies. We are one of the first brokers in the Middle East to offer bitcoin, and it has been estimated that 2017, trading in digital currencies will break the $1 trillion mark, an increase of 15 per cent on 2016. As cryptocurrencies link into and open up payments within the internet-ofthings, we will really see AI taking off. ADS Securities has recognised the importance of having the right people. What makes somebody right for ADS? Before the products came on stream the team made sure that it had the correct people and the right regulatory approvals in place to manage the
services being provided. We invested in our employees–taking on the best of the best. Like most UAE financial services firms, ADS Securities looks for a blend of local and international experience and expertise. The firm now trades up to $19 billion a day, which means there is no room for mistakes or bad decisions. Everyone has to be exceptional. The business has always taken the view that it will wait for the right person rather than making sure a post is filled. In the last seven years ADS Securities has grown from a small forex brokerage into an international finance house with global reach. The rate of growth, and the success of the firm, is only the starting point. The future of financial services will be driven by technology and people, and we want to be a leader in both these areas. This is not going to be easy. Every day, we face challenges and need to take difficult decisions. But we are blessed by the support and vision of Abu Dhabi and the UAE. The United Arab Emirates offers stability and has a forward-thinking Government, as other markets are rocked by uncertainty and indecision. This is why Abu Dhabi is now becoming the investment market of choice. I cannot wait to see what ADS will achieve in the next seven years.
TYPE 6 LICENCE The Type 6 licence allows ADS Securities to advise clients on corporate finance, enabling it to provide a comprehensive financial platform and a diversified financial product selection to clients, The licence also allows ADS Securities to act as a financial advisor in compliance with the Hong Kong Listing Rules in M&A transactions, fundraising activities, corporate and capital restructuring, securities financing, and disclosure obligations. Source: www.ads-securities.com
WWW.FINANCEMIDDLEEAST.NET
p18-21_CEO Chat.indd 21
21 9/18/17 5:21 PM
COUNTRY FOCUS
SANDBOX CLEVER The Bahraini Government has taken a number of steps to develop different areas of the SME sector to make the Kingdom more competitive in the GCC region and internationally
B
ahrain is on track to become the fintech capital of the Middle East and all the right elements are place to achieve this goal, according to HE Khalid Al Rumaihi, Chief Executive, Bahrain Economic Development Board (EDB). While regional and international corporates are targeted by the EDB to set up a presence in the Kingdom as per its mandate to attract investment, it is generally accepted that SMEs and startups create jobs in most economies. Encouraging foreign direct investment (FDI) into Bahrain goes hand in hand with creating an ecosystem that will
attract entrepreneurs to set their enterprises in the Kingdom. Fintech is of particular interest to the EDB and other governing bodies in the Kingdom because it is one vertical in the technology start-up space, and putting a robust ecosystem in place will encourage entrepreneurs and start-ups to develop and innovate in the Kingdom.
REGULATIONS The Kingdom offers a business-friendly environment that is the sum of its parts. Proper regulation is crucial because fintech deals with financial services. In
June 2017 the Central Bank of Bahrain (CBB) launched its regulatory sandbox, providing a virtual space for companies to test their fintech-based solutions. The sandbox is open to existing CBB clients and other local and foreign firms and offers these start-ups the opportunity for expansion. When the first steps to establishing the sandbox were announced in February, Al Rumaihi said the response from global companies was overwhelming with many of them indicating that if the sandbox was put in place, then they would definitely be interested in setting up a presence in
22 p22-25_Country.indd 22
9/24/17 11:53 AM
SHUTTERSTOCK/ LIGHTFIELD STUDIOS
We’re a small country but our size allows us to incubate these ideas and allow innovation to take place. – HE Khalid Al Rumaihi, Chief Executive, Bahrain Economic Development Board (EDB)
Bahrain in order to conduct business. The sandbox welcomed its first two entrants at the end of August 2017–NOW Money, the Dubai-based account and remittance service for low-income workers in the GCC, and Tramonex, a London-based forex cash management solution for businesses. The sandbox has gone a long way to provide a degree of comfort to the regulators in the Kingdom and to their credit Al Rumaihi said they have been incredibly responsive. One of the issues regulators have with fintechs is being comfortable with an entity that launches a product that could
negatively impact the consumer, the lender, or the borrower. “Their concerns are valid–you do not want a body launching a product that will result in customers having their information being hacked and their data being leaked. We are working closely with the regulators but we also believe these issues can be addressed by working with the right countries and providers,” said Al Rumaihi. These fintech start-ups are also relatively new and may not be what traditional markets are used to and getting investors and regulators to adjust to these changes is a challenge,
said Areije Al Shakar, Vice President and Deputy Head of Development Services, Bahrain Development Bank (BDB). “At least these start-ups have access to the regulator whether it is through the EDB, through us [the BDB] or direct access to voice whatever challenges they are facing to formalise a policy framework change,” she said. To avoid reinventing the wheel, the EDB has studied models by regulators in other parts of the world such as London and Singapore. Earlier this year an agreement with the Singapore Fintech Consortium (SFC) was signed to advise the EDB and CBB on what has and cont. overleaf
WWW.FINANCEMIDDLEEAST.NET
p22-25_Country.indd 23
23 9/24/17 11:53 AM
COUNTRY FOCUS HE Khalid Al Rumaihi, Chief Executive, Bahrain Economic Development Board (EDB)
Areije Al Shakar, Vice President and Deputy Head of Development Services, Bahrain Development Bank (BDD)
cont. from pg. 23
hasn’t worked in the varying domiciles of the country. He added that Singapore has a respected regulator, and working with the SFC will go a long way to make the regulator more comfortable with the disruption that fintech development will inevitably cause. Al Rumaihi said that second element that works in Bahrain’s favour is the willingness by the Government to allow disruption to take place within the Kingdom. If governing bodies are going to allow fintech companies to operate in their country, they have to allow them to innovate and sometimes challenge incumbents. “We have a very sophisticated central bank that has been operating since the 1970s which was a pioneer in Islamic finance, so dynamism is embedded in the Bank. It is a strength that should not be underestimated. It is no coincidence that global fintech hubs have emerged in places that
have very forward-thinking central banks,” he said. A good example of this can be seen in Bahrain’s deregulated telecoms sector which has grown to 20 players, and stiff competition has seen majority-state owned entities complain about dwindling margins. Al Rumaihi added that the Government remains open to further disruption and will take this same approach in the fintech space. “We’re a small country but our size allows us to incubate these ideas and allow innovation to take place. Other members of the GCC can take comfort in this– an entrant can come to Bahrain, become regulated by our central bank, sample their technology in our country and then migrate to larger markets, such as Saudi. We will be that entry point where they first establish their presence,” said Al Rumaihi.
In the future the EDB would like to set up a fintech venture capital fund to be run in partnership with a professional firm. From there, the goal is to build and strengthen relationship with other locations, such as Singapore, where the CBB would sign an agreement with the monetary authority to allow entities to be regulated in Bahrain and then transfer to those partner locations. This would allow for an exchange of fintech companies between those cities.
FROM FINTECH TO FINANCE Al Rumaihi is also the Chairman of the Development Bank of Bahrain, and said financial institutions need to differentiate between start-ups and SMEs. SMEs are vital to create self-employment and in turn create jobs, and they are vital to any economy, yet their biggest challenge remains access to finance.
24 p22-25_Country.indd 24
9/24/17 11:53 AM
Tamkeen, an organisation in place to develop Bahrain’s private sector was established in August 2006, and is part of Bahrain’s national reform initiatives and Bahrain’s economic vision. It has been a great platform to extend financing or grants to entrepreneurs but Al Rumaihi said financing needs to be taken a step further and the BDB wants to simplify the lending process. The Development Services Division of the BDB has a banking division and an investment division to cater to SMEs, said Al Shakar. The banking division offers start-up and SME loans from BHD 5,000 up to BHD 500,000 and the average loan taken by a small business is between BHD 100,000 and BHD 200,000. The investment division of the bank offers equity participation to growing enterprises of less than 20 per cent of the paid up capital of the company wanting to expand into different areas. The BDB also runs a number of programmes and facilities to support entrepreneurs. Rawat was designed and launched in 2015 and is a platform that offers coaching, training, funding, and incubation. Riyadat is the BDB’s first women-focused incubator in the region whereby businesses are 50 per cent owned by Bahraini women. Finally, the bank has an ICT incubator that houses tech-focused start-ups and is the only incubator owned and managed by the BDB that offers 100 per cent foreign ownership, added Al Shakar.
BEYOND FINANCE Once an SME has grown and developed a bit of traction and raised a round of funding, they tend to be neglected at the scale-up stage and while these businesses do not fall within the EDB’s mandate, Al Rumaihi conceded that this is an area that needs to be addressed. The BDB has started to work closely with developing small businesses
under the mentorship branch of the Rawat programme. “Our mentors are either local or regional, or some cases international. An entrepreneur does not need to select one mentor for their business; a mentor can focus on and help with one area of the business and an entrepreneur can work with more than one mentor at a time, even just for one project,” said Al Shakar. Mentor profiles are up on the BDB website and each profile is very specific and personal. The entrepreneur has to supply a short list of the mentors with whom they would like to work and the Rawat team facilitates the connection with the mentor, once the mentor accepts the requests and commits to the time the entrepreneur requires. “The type of questioning we ask the entrepreneur is which areas they need help with and then help them identify a strong mentor. The mentor is there to help to help broaden the way an entrepreneur makes decisions and to offer experience in certain areas. A tech entrepreneur may work with a mentor that has no tech background but has extensive knowledge and experience in marketing and customer acquisition which can be areas that be incorporated into your project,” she added. The BDB also offers a coaching programme with a team of certified coaches who can assist the entrepreneurs in reaching their personal development goals to refining their skills when sitting in front of investors, suppliers, or customers– all important soft skills that the BDB tries to foster. Al Shakar added that BDB offers a holistic platform that helps the overall ecosystem by ensuring that any start-up that is based in Bahrain has access to each of the parties that can support them–Tamkeen, the EDB, available accelerator programmes, or the BDB’s wider network.
WHY SET UP IN BAHRAIN • LOW OPERATING COSTS
Total operational costs are 30 per cent lower than in other GCC hubs.
• QUALITY OF LIFE FOR EXPATS Bahrain ranks ninth overall in the world for expat satisfaction, and number one in the entire GCC.
• SEAMLESS COMPANY SET-UP
Bahrain EDB ensures that starting your business is as easy as possible, with expert assistance, minimal bureaucracy and the lowest operating costs.
• ROBUST ICT INFRASTRUCTURE
Ranked first in the region for ICT infrastructure, Bahrain has the best base for technology and innovation to thrive.
• START-UP LOANS
Over $150 million in start-up loans awarded each year by Bahrain Development Bank.
• CENTRAL LOCATION
Other GCC countries are around one hour’s flight away.
Source: The Bahrain Economic Development Board
WWW.FINANCEMIDDLEEAST.NET
p22-25_Country.indd 25
25 9/24/17 11:53 AM
SHUTTERSTOCK.COM/ SERGEY NIVENS
RISK MANAGEMENT
Proper risk management can stop the domino effect of financial loss following an unplanned event.
RISKY BUSINESS
Business risks exist everywhere but early implementation of a proper management system can mitigate them once they occur or even catch them early
S
MEs are becoming increasingly aware of the importance of risk management but it’s still a challenge for businesses. Risks exist everywhere and cannot be avoided entirely, and they can impact a company’s production and management.
The most vital part of any risk management strategy is its impact on capital growth of the company in relation to possible negative results the risks may produce. Fatal flaws are usually very simple. It's oftentimes the unassessed goals that drive risks high,
according to Michael Goryany, Director, Origination and Client Coverage, Trans Global Partners Ltd. Putting risk management in place does not have to be complicated because the core of risk management is the sound management of resources
26 p26-29_Feature.indd 26
9/19/17 8:59 AM
which includes how it is made, when it Hickman added that a lot of risk comes into the company, and how and management is driven by a negative when it leaves. Business owners should event which will stimulate the business not be afraid of risk and implementing managers into thinking “We must do strong risk management because something about risk management” these will be a source of increasing and it gets added onto the agenda. competitive advantage going forward Ideally whenever a company is looking if used as an offensive measure rather to launch a new product, for example than a defensive measure, according there are certain things the business to Evans Osemwegie, Managing owner will have to deal with such as Director at financial services group, certain regulatory or legal issues that Evago Global Capital. have not been explored before. If the “The best time to implement a risk product is launched without meeting management programme is yesterday! these certain requirements it can be Any event, new project, product launch, costly and timely to correct. These are new hires, new markets all require risk all trigger points where it’s important management to be considered, and I for the risk management process to be always recommend keeping matters undertaken, and it has to come from simple, and look at objectives agreed the top of the business but also has While businesses can provide interns with by the board, senior management,” to link back to the objectives of the experience and mentoring, interns can bring a said Mitchell Hickman, Enterprise Risk company agreed by the board or the fresh perspective to the table. Management Consultant. senior management.
For any SME owners in the process of setting up their business, Osemwegie advised that risk management should be one of the primary considerations when putting together a business plan. “Risk management should be the golden thread that runs through your business because at the core of every venture, there is threat which ultimately leads to financial risk.” At this early stage of the business he cautioned against going to the bank immediately to help design or implement a risk management strategy. “There will be a place for the bank or financial house later but not at the beginning. If necessary, bring in an independent risk professional to advise and help design the system; it is only when there are specific tasks for the financial institutions that one should approach them otherwise one cont. overleaf
PRINT WITH PEACE OF MIND 2,000,000,000 pages printed with GIT toners 10 millions USD saved 3 million kilograms of CO2 and 1 million kilograms of waste saved
Reliability
Responsibility
Responsiveness
Press “Print”, we take care of the rest
German engineering at its best Toners l Printers l Service l Leasing l MPS
+971 42 85 35 38 www.gitmea.com WWW.FINANCEMIDDLEEAST.NET
p26-29_Feature.indd 27
27
9/19/17 8:59 AM
RISK MANAGEMENT
cont. from pg. 27
could find themselves paying a lot for basic information that the business owner themselves could find,” he said. The easiest way for an SME to manage risk effectively, within limited resources is to start simply with operational risk management, because financial risks are a result of the operational structures and systems of a business. A good start is to shorten the sales cycle as much as possible, reduce inventory turnover and account receivable turnover ratio, said Osemwegie. These will help the business to be more efficient.
MANAGEMENT’S ROLE Bureaucracy is just as much a factor to successful risk management and SMEs have an advantage because decision making lines are much
simpler in smaller businesses than larger companies, which tend to have more steps in communication between management and staff. This lag in communication can impact the company’s ability to respond to and mange risks quickly and effectively, said Goryany. This lean communication structure allows management to break processes down into manageable steps to eliminate any potential risks or to avoid the negative effects of those very risks. Some of the less obvious and more overlooked risks include internal fraud, loss of data, data leakages, the negative impact of poor hires, as well as ways in which companies can transfer risk in the form of insurance, added Hickman. “Personal identity theft and cyberrisk is very topical right now and that is
becoming more and more en vogue in terms of companies looking to mitigate against that. It all comes down data losses and leakages, and personal identity theft, which are now starting to have a higher priority but historically have been overlooked by management in the past.” Certain events such as the recent storm of March 2016 in the UAE, which temporarily raised awareness and interest in insurance, and saw a portion of SME clients remain uninsured, keeping them vulnerable to increasingly volatile and damaging events that businesses face every day. “Companies that are massively over insured and do not even realise it are paying astronomical premiums. Other areas that can get overlooked by business owners are property loss
28 p26-29_Feature.indd 28
9/19/17 8:59 AM
or a lack of disaster planning. If your company suffered a flood or a fire, does it have the ability trade from an alternative location? Do they have a continuity plan?” Hickman added that if the business grows too quickly the business owner needs to consider whether the company has the right resources, and finance in place to support that growth. Employment and professional liability tend to be overlooked along with contract risks, entering into contracts without fully understanding whether they are liable for certain things or when they are going to get paid. According to a recent KPMG survey, many global CEOs believe that the next three years will be more critical for their business than the last 50, and most changes will be driven by technology that is continuously developed and made available almost immediately. This means that rapid adoption and use of new technologies is happening ahead of the ability of SMEs to understand and respond to them. The survey showed that for SMEs, new technology is a mixed bag– it offers new tools and dashboards that can improve operations and risk management, products and services, but comes with a new range of risks. “These businesses have to look at what they want those risk dashboards to do for them. Technology is starting to change the face of risk management but when considering the costs of implementing some of these software solutions, they can also be quite prohibitive for an SME,” said Hickman. Osemwegie added that despite the number of software solutions available it is unadvisable for a business owner to implement any new technology to run risk management until they are sure of what aims they are trying to achieve, otherwise a lot of time and money will be wasted unnecessarily. Technology is not a panacea for lack of knowledge.
Risk management should be the golden thread that runs through your business because at the core of every venture, there is threat which ultimately leads to financial risk.” – Evans Osemwegie, Managing Director, Evago Global Capital
HOW CAN A TEAM MANAGE RISK? • Employ a chief risk officer. This can be the CFO or the Finance Director. This must be a board- level position. • Keep and update a risk management policy document where all of the normal risks and unforeseen risks have been analysed and assessed with specific responses agreed for each of them. • A risk management committee should continually assess risks in specific transactions. • Continually communicate what you are doing with external stakeholders such as government entities, customers, shareholders and so on because it will eventually transform itself as a real competitive advantage for the company. • Encourage ownership of risks and eliminate a blame culture. • Give employees the right resources to manage risks effectively. • Ensure risk management forms part of any KPI's for the organisation. • Accept risk events will occur and that learning from these events creates new opportunities, and brings improvements to customer service or governance. • Set realistic goals and understand the company’s strategies in relation to risk. • Take enough of the right risks. Entrepreneurship is connected to risk at all times. However, if addressed properly every risk is measurable, and that can bring the biggest advantage. Source: Michael Goryany, Director, Origination and Client Coverage, Trans Global Partners Ltd.; Evans Osemwegie, Managing Director at financial services group, Evago Global Capital; and Mitchell Hickman, Enterprise Risk Management Consultant.
WWW.FINANCEMIDDLEEAST.NET
p26-29_Feature.indd 29
29 9/19/17 8:59 AM
PITCHING TO INVESTORS
PITCH PERFECT T
he first six months of 2017 saw 88 closed deals amounting to $290 million in start-up finding according to MAGNiTT’s recently published MENA Funding Report Card H1 2017. The report highlights a healthy appetite for investment in MENA start-ups and points to a healthy and growing ecosystem, according to MAGNiTT Founder, Philip Bahoshy. He added that this strong start to the year could see the MENA region matching, if not exceeding, 2016’s funding figures. With SMEs making up 95 per cent of businesses in Dubai alone, the alternative sources of funding are helpful in developing the private sector, but the process of securing funding is not as cut and dry as simply submitting the right documentation. Once an SME owner has all the required documentation for fundraising, they still have to present their pitch to potential investors. Their pitch could either see an investor come on board, or ensure the idea never even gets off the ground. Companies need an average of 40 investor meetings and take and average of 12 weeks to close a round
of funding, according to a study by file-sharing site DocSend and Harvard Business School professor, Tom Eisenmann. The study looked at over 200 global pitch decks of companies that had raised $360 million in total. The study also found that investors do not look at pitch decks very long, averaging three minutes and 44 seconds. When standing before investors, M&A lawyer and venture capitalist Rick Frasch suggests banking on 15 minutes for the presentation and 15 minutes for a question and answer session afterwards. He added that the ‘elevator pitch’ should be no more than one minute–that is everything in the pitch should be able to be condensed into that time, which means the business owner needs to know all the required information at all times. “Make sure you know all your numbers by heart, whether it is statistics such as market size or growth, or internal numbers such as burn rate and daily active users. This also includes the size of the market; the market needs to be large enough and growing. Saying ‘It is a $10 billion market, so even if we
have one per cent, it would still make ours a $100 million revenue company’ is usually not a good idea,” said Tarek Kabrit, Co-Founder, Seez, an app that will search, shortlist, and negotiate deals on the purchase of a car. Seez raised $1.8 million in seed funding in June 2017. Zahra Hamirani, Chief Education Officer, The Blossom Nursery/Blossom Early Learning Centre added that bringing in an advisor who has done deals in the past in your sector is critical. Having bootstrapped her company initially, Hamirani has recently closed a funding round and said she and her team hired the team at Deloitte who managed interest that was coming in and provided insight and noted what interested parties could and could not bring to the table. Both Kabrit and Hamirani stressed the importance of practicing the pitch in front of friends and family. “Being a strong, confident speaker is essential and therefore doing presentations on your business a few times is crucial. I am often surprised how people can miss big parts of the story when they fail to prepare and practice. We spoke to a number of parties who came our way, and this was useful in
30 p30-32_Investors.indd 30
9/19/17 9:07 AM
SHUTTERSTOCK.COM/ SERGEY NIVENS
When pitching to investors, keep the slides simple and the story concise.
understanding what we did not want in a partner. When we went to market we were clear in our expectations and could articulate what they were; we did not have to enter negotiations only to find out there was a big chasm that could not be bridged,” Hamirani said.
STORY TIME Investors are not only interested in the financials and projected figures of the business within the market.
Kabrit said that when pitching to investors, business owners need to relay it as a coherent story. “The pitch should start with a problem, propose a solution, and this solution should translate into revenue which depends on the required funds to achieve. Often what founders think is solving a real problem is not the case, so make sure that your assumptions are tested with real users before stating them as facts.”
Some sort of product differentiator should be included in the story– something that would provide the company with an edge, should someone else decide start the same business or launch a similar product tomorrow. The differentiation factor of the business may also have to be a sticking point where the SME owner may need to stand their ground. “Blossom is a company that is sustainable and green and we began to cont. overleaf
WWW.FINANCEMIDDLEEAST.NET
p30-32_Investors.indd 31
31 9/19/17 9:07 AM
PITCHING TO INVESTORS
The pitch should start with a problem, propose a solution, and this solution should translate into revenue which depends on the required funds to achieve.” – Tarek Kabrit, Co-Founder, Seez cont. from pg. 31
focus on this as a key business feature. We are ‘triple p’–people, planet, prosperity– so not fully for profit, and spend a lot to ensure our places and process follow our green values. If a potential investor brushed this aside or began to make noises about why we spent a lot on our LED lighting when fluorescents are cheaper, or queried why we choose Forest Stewardship Foundation-approved furniture for our classrooms and the like, this was often a sign that they may have a different priority than we do. If they get the Board representation to change things they may go ahead and do this. Knowing this will help decide if the team is the right fit but also help you negotiate agreements and reserved matters later on,” said Hamirani. She added that investors want to see if the team will remain committed and in place or if they are looking to exit; these are questions that need addressing because most investors are not simply buying the company vision but also want to see the team that will grow and effectuate the plan that is being pitched. Answering the investors’ questions with a focus on the leadership team who are responsible for making the business successful and a showcasing a strong understanding of the business’s customer base and how they will be reached must be included. She added that she found the Business Model Generation helpful for a business owner to highlight their differentiation points and discover where their values lie, which is essentially what the buyer needs to hear and value.
WHAT TO AVOID WHEN MAKING A PITCH • Rambling If founders find themselves talking about the same point for more than 30 seconds, this should be an alarm bell to move on. When they do not know the answer, it is better to say so and that they will check that and revert, rather than to go around in circles. • Insufficient information If investors feel that there are key areas that have not been covered, it might reflect badly on the founders and make it seem like they do not really understand the complexity of what they are trying to achieve. • Claim there is no competition Every product or business has competition in the market, even if they the product or service offered is not identical. Saying that there is no competition whatsoever shows a lack of market research. • Not researching the investor In the age of LinkedIn and Google it is easy to find information and seeing who they are as people. This can also highlight connections that can be used to link in an interest or focus they have, such as awards and associations they belong to, alma maters or transactions they may have done in the past. Knowledge is power! • Not understanding the investors capability Are you pitching to the decision maker? Do they need board approval or bank consents before making a decision? There are many middlemen in the market and understanding who the investor is and what they can do will help ensure your pitch is aligned to the person’s ability to take action. • Making it all about you Passion is certainly is a must but it cannot be a pitch that glorifies you as the founder or shows you as indispensable. Success is a team effort and investors will not want a one man show so be careful when pitching to allow for the business to shine through. • Wasting time Do not allow yourself to be drawn into discussions, or be interrupted by questions which preclude you from using your time effectively. • Arguing with the investors Even if investors say ‘no’, all the feedback provided will help you improve your pitch for when you try again. Source: Tarek Kabrit, Co-Founder, Seez and Zahra Hamirani, Chief Education Officer, The Blossom Nursery/Blossom Early Learning Centre
32 p30-32_Investors.indd 32
9/19/17 9:08 AM
P in L
Profiles in Leadership An important new series from CPI Financial, the Middle East’s leading financial and business publishing house. In challenging times, clear and dynamic leadership is the key to business success. CPI Financial’s new series Profiles in Leadership will identify and define those qualities necessary to succeed, profiling successful individuals and their businesses.
CPI Financial TV CPI Financial TV is proud to launch a new online Leadership series. We are conducting a series of in-depth, on-camera, face-to-face interviews with the key players in the Middle East banking and financial services sector. Dubai Islamic Bank The longest-established modern Islamic bank is one of the leading financial institutions and our interview with its Group CEO launched our Leadership series on 10 September 2017. You may watch the full interview online or alternatively view key segments of the interview individually. Who’s next? Our Leadership series launches with Dr. Adnan Chilwan of Dubai Islamic Bank. Look out for more great interviews in the coming weeks. We already have Patrice Couvegnes, CEO of Banque Saudi Fransi, and HE Abdul Aziz Al Ghurair, CEO of Mashreq, lined up with even more to come… Unparalleled insight Understand how the region’s top bankers view the challenges and opportunities their institutions face… and the plans they intend to implement. Identify ambition Whether in the domestic, regional or international arena you will be able to see for yourself just what is in store in the evolution of one of the world’s most dynamic economic arenas and for the institutions helping to bring economic dreams into successful reality. Bookmark CPI Financial TV Bookmark CPI Financial TV now to make sure you stay in touch and on top of these unique insights into the region’s banking and financial services industry.
IN-DEPTH INTERVIEWS
Dr. Adnan Chilwan Group CEO Dubai Islamic Bank
Patrice Couvegnes Group CEO Banque Saudi Fransi
HE Abdul Aziz Al Ghurair CEO Mashreq To learn more, contact: OMER HUSSAIN
CPI Financial FZ LLC • PO Box 502491 Al Shatha Tower, Office 1209 Dubai Media City, Dubai, U.A.E.
+971 4 391 5419
omer@cpifinancial.net
Tel: +971 (0) 4 391 4681 • Fax: +971 (0) 4 390 9576 • www.cpifinancial.net
p30-32_Investors.indd 33 P in L advert_version2.indd 1
9/19/17 9:08 AM 14/09/2017 15:06
CASE STUDY
OREO YOU READY? Mohamed Shalaby discusses how the right public-private partnerships have allowed Mondalēz to expand its presence in the country and meet the growing market demand in the GCC
U
S-based confectionar y powerhouse Mondalēz has expanded rapidly in the GCC region since it built its first factory in Bahrain in 2005. In more recent years, its existing factory has not been able to keep up with demand. For example, Mondalēz Bahrain’s biggest market for goods and services is Saudi Arabia, 25 kilometres away via the King Fahad Causeway. At its existing production levels the Bahrain factory was struggling to meet growing market demands. Mondalēz needed to expand its manufacturing facilities. In 2016 the company began construction on its brand-new 85,000plus square metre Bahrain-based cake and biscuit factory.
This $90 million plant is based on a 250,000 square metre plot, and will be the manufacturing hub, not only for Bahrain but for the whole GCC, according to Mohamed Shalaby, Plant Director of Bahrain and Dammam–Mondalēz. “This [new factory] is our second investment in Bahrain, and is an expansion of our existence in the country. We started with our powder beverage category in Bahrain 10 years ago with a $50 million investment plant, and now, up to 47 countries are reached from it,” said Shalaby. The Bahrain Government has allocated an additional 250,000 square metres which are to be dedicated to suppliers. The allotted 250,000 square metres will be located next to the new manufacturing plant, thereby building
a supply chain model that Mondalēz wants to create.
MARKET REACH The FMCG business’s success relies heavily on being able to meet the market’s demand for fresh products quickly, and the development of the newer, larger manufacturing hub will assist in the confectioner’s goal to cut transportation times to one of the company’s biggest markets. “This year we reached an average of 22 to 24 hours crossing time between Bahrain and Saudi. Products can be
34 p34-37_Case study.indd 34
9/19/17 9:12 AM
Logistics and transportation were key challenges and partnering with the Government to resolve these issues encouraged us to make the second investment in Bahrain.” – Mohamed Shalaby, Plant Director of Bahrain and Dammam–Mondalēz
shipped the same day from Bahrain to any location within Saudi, which is almost 70 per cent of the GCC market volume. We want to reach these countries within 24 to 48 hours maximum, so we can deliver fresh products to our consumers and be able to react quickly to the market. Logistics and transportation were key challenges and partnering with the Government to resolve these issues encouraged us to make the second investment in Bahrain,” said Shalaby. The strong relationship with governing bodies included customs
officials, with Bahrain boasting some of the best clearance times in the GCC. Mondalēz can clear its raw materials properly within 24 hours, and move them swiftly into operation. Mondalēz does not need to allow for a two-to-three-week time buffer for compliance spot tests on ingredients as could be the case in other countries when it comes to receiving raw materials. If something were to go wrong in this process, or if another test was required, or if the process is illdefined on the clearance side, these are all occurrences that can disturb business flow. The fact that this potential delay is not an issue in Bahrain is a distinct advantage that the country has.
“We have highlighted that this is an edge that Bahrain needs to maintain– even if the capacity increases on the harbour, this edge should not be lost because it is one of the country’s strongest elements,” said Shalaby. The Bahrain Economic Development Board (EDB) and the Government have also helped to improve the consistency of the processes in place. Instead of requiring two or three documents per truck leaving the Mondalēz factory, to the causeway, and then to customs, this procedure has been improved and streamlined to a one-document process. Mondalēz is currently working with the Government to further improve the 24-hour crossing time over the cont. overleaf
WWW.FINANCEMIDDLEEAST.NET
p34-37_Case study.indd 35
35 9/19/17 9:12 AM
CASE STUDY
cont. from pg. 35
causeway. They are hoping to reduce it to four hours. The EDB and customs departments are working hard with Mondalēz, as well as regulators in Saudi Arabia to improve these processes and protocols so that this can be a reality. According to Shalaby, while, there is still much work to be done, Mondalēz hopes that the quicker crossing time will be able to be implemented by the end of 2017. This will benefit Bahrain immensely, allowing it to not only be a regional manufacturing hub, but a highly important logistics hub too. As an FMCG business Mondalēz only sells approximately three per cent of its volume within Bahrain so an export model had to be set up to remain competitive. Building an effective supply network has helped to ensure this competitiveness. “We had to work aggressively as a company in developing our suppliers, to qualify them and improve their standards of quality. In the first year we started with a couple of suppliers but now, 10 years later, we have 350 local suppliers and 12,000 indirect employees for Mondalēz in Bahrain. It’s not really about our operation but it’s really developing the suppliers that work with us. The Bahrain Investment Industrial Park (BIIP), where we are situated, the Ministry of Industry and the EDB all worked together with Mondalēz to develop these local suppliers. Some of these suppliers even qualify to supply our plants outside of Bahrain. There is still more to do,” added Shalaby. “Suppliers will not have to carry as much stock and they will be very flexible to the market and manage demand fluctuations. Imagine if the amount of market fluctuation requires a supplier to change their
sourcing cycle, when their material has a two-month month lead time, or even a four-week lead time. Their response time will be delayed by those four weeks or two months, which is not what the consumer expects,” he added.
THE HUMAN ELEMENT Mondalēz places a high value on the safety, health, and well-being of its work force not only from a physical safety perspective, but also from an employee value perspective. Shalaby said there is a high level of engagement between management and staff, with management driving training and education amongst its employees and actively developing and nurturing a company culture. “We have high engagement with the families of our employees; we invest in training them onsite on topics such as family home safety, and road safety. We work with the wives of our employees on kitchen safety; we speak to the kids on how to carry their school bags correctly on both their shoulders, and how to avoid back problems in the future. We do this because we really want to make sure that our employees are safe everywhere. It’s not about just being safe in the plant when using the equipment,” said Shalaby. “This vested interest in staff well-being has resulted in high engagement levels across all the Mondalēz teams, with employees visibly committed to improving the business.” He added the result of implementing these values can be seen in the company’s performance. The Bahrain hub is globally recognised within the Mondalēz group as a benchmark in efficiency, cost, and safety standards. The entire team is working to deliver robust results to the business.
THE PROBLEM
In order to meet the consumer demand within the GCC, Mondalēz needed to invest in improving and expanding its manufacturing and logistics hub. Mondalēz also needed to streamline the customs procedures to reach its market quickly.
THE SOLUTION
• The Bahraini Government allocated 250,000 square metres for a manufacturing plant with an additional 250,000 square metres of land dedicated to its suppliers right next to it. • Customs processes and procedures were refined to cut down on the required paperwork to bring in raw materials and send out manufactured goods. • The company has invested heavily in health and safety training and in the overall well-being of its staff.
THE RESULT
• Mondalēz can now work closely with suppliers to respond quickly to market fluctuations and requirements, by cutting down the supplier lead time. • Customs procedures allow for goods to be cleared within 24 hours and sent into operation immediately. • The supply chain of products sold into the GCC has been significantly simplified. • Staff engagement is high with employees committed to the development of the business. Source: Mohamed Shalaby, Plant Director of Bahrain and Dammam–Mondalēz
36 p34-37_Case study.indd 36
9/19/17 9:12 AM
24-22 hours average crossing
$90 million
invested in a manufacturing hub
500,000 square metres
time into Saudi
Only 3% goods sold within Bahrain
100% foreign
allocated for further expansion
ownership
Saudi makes up
70%
350
12,000 indirect employees
local suppliers
Mondalēz Bahrain
of Mondalēz GCC market
Source: Mohamed Shalaby, Plant Director of Bahrain and Dammam–Mondalēz p34-37_Case study.indd 37
WWW.FINANCEMIDDLEEAST.NET WWW.FINANCEMIDDLEEAST.NET
37 9/24/17 12:08 PM
FACE TIME
SAFE IN THE CLOUDS B
usinesses are set to lose $8 trillion to cybercrime over the course of the next five years, according to a new report by Juniper Research. The paper, titled The Future of Cybercrime and Security: Enterprise Threats and Mitigation 2017-2022, claims that approximately 2.8 billion personal data records could be stolen in 2017, with that number doubling to five billion three years later, and that this threat is largely due to improved levels of internet connectivity coupled with inadequate cybersecurity. Internationally the world is playing catch-up, and from a strategic perspective the GCC region is realising there is a skill and knowledge gap that has to be addressed alongside the technical aspect of cybersecurity, according to Hadya Fathalla, Executive Director, C5 Capital, a Londonbased technology investment firm that focuses on cloud computing, big data analytics and cybersecurity.
The firm has increased its presence in the region via its Bahrain office by developing a number of arms which focus on helping young, transformative tech companies by giving them the power of cloud computing. Bahrain was selected as the launch pad for this project, which is open to the entire EMEA region, because of its deregulated telecom environment. Fathalla said the Government is very quick to respond to the needs of the business community and the start-up community, as well as providing a gateway into Saudi which is a key anchor market for a lot of young businesses.
CHALLENGES Cybersecurity is just as much a concern in Bahrain as the rest of the world and Fathalla said there are three key issues that need to be taken into consideration. The first is a more accurate and robust understanding of the threat itself; the second is the
ability to address the threat from a technical perspective; and the third is upskilling the workforce to be capable of addressing these threats, particularly in light of global attacks such as WannaCry and Petya. These attacks highlighted vulnerabilities that everyone is facing; as people become more connected and more technologically advanced they become equally more vulnerable. “I think we continue to be blindsided by new, more sophisticated attacks that are becoming much easier to deploy by people sitting at home. You do not need much to deploy into cyberspace, you can do it from the comfort of your living room and by kids so young they’re not even in high school yet. It’s lucrative and it’s destructive,” said Fathalla. She added that from a strategic perspective governments and businesses in the region have also acknowledged that be able to build the technical solution to address
SHUTTERSTOCK.COM/EVGENY KARANDAEV
Hadya Fathalla, Executive Director, C5 Capital discusses the role SMEs can play in tackling cyberthreats head on
38 p38-39_Facetime.indd 38
9/19/17 9:14 AM
There are a lot of new businesses that are building some exceptional solutions in the start-up and scale-up space; I think that is where the future of cybersecurity is going to be focused. – Hadya Fathalla, Executive Director, C5 Capital
these attacks, there has to be an awareness and an appreciation of the risk, and the ability to be able to upskill the workforce that can adjust accordingly. Officials have called for more cybersecurity cooperation in the GCC during the Gulf Information Security Expo and Conference (GISEC) held in Dubai in May this year. They warned that cyberattacks could target critical infrastructure such as airports, oil installations, banks and tourism networks. This is a space where SMEs can thrive. At the beginning of 2017 C5 Capital launched its cybersecurity lab specifically to address these three issues, to spread awareness about where threats lie, what can be done about them, to conduct research and development in the space, and to help businesses upscale. “Cybersecurity has been identified as one of the most underserved areas, not because there is a lack
of interest in serving it but because there is a genuine lack of people who can and that is where there is a huge opportunity for young SMEs to build in that space. There are a lot of new businesses that are building some exceptional solutions in the start-up and scale-up space; I think that is where the future of cybersecurity is going to be focused. That is why as a company we focus on young cybersecurity companies as well as a key area not only from an investment perspective but also from an acceleration perspective,” said Fathalla. She added that there is a company focus on transformative tech and B2B companies because it is believed that these are the areas where there are going to be gaps in the industry and human capital, and companies should be encouraged to look at these areas and build on them. It will be these young companies that can service other young and growing companies
in the areas of cybersecurity, fintech, smart cities, and robotics, when the giants become too expensive or even slightly outdated.
2017 SECURITY CHANGES BY CYBERATTACK VICTIMS 52% have no changes planned. 31% are making changes to their security plan. 17% are not sure. Source: Barkly.com
2017 BUDGET FORECAST FOR CYBERATTACK VICTIMS 45% expect the budget to remain the same. 38% expect the budget to increase. 10% are unsure. 7% expect the budget to decrease. Source: Barkly.com
WWW.FINANCEMIDDLEEAST.NET
p38-39_Facetime.indd 39
39 9/19/17 9:14 AM
BRAND
CRAZY FOR KOOPLES
T
The Kooples Co-Founder and CEO, Nicolas Dreyfus discusses launching a brand on a large scale during the financial crisis and sustaining its continual growth
F
or the first time since its 2008 launch, French fashion brand The Kooples will introduce a hand bag range in September 2017. Accessories only represent about seven per cent of The Kooples’ revenue and the most searched for term on their website is ‘bag’, which the company previously did not offer. This year the brand will launch 30 different variations of a handbag under the label ‘Emily by The Kooples’ in collaboration with Emily Ratajkowski, actress, model and activist. Co-Founder and CEO Nicolas Dreyfus said that the way the fashion industry is changing means labels need to think about innovating all the time and capsule collaborations allow them to offer something new to their clientele. The company will launch the handbags across all 450 of its global stores simultaneously and will negotiate with department stores for dedicated space both in their display windows and on the shop floors.
The launch will follow the same bold marketing campaign the company has followed since it first opened its doors in France on 1 September 2008, during the financial crisis. Dreyfus and co-founders and brothers Raphaël, Laurent, and Alexandre Elicha opened 22 stores simultaneously–13 in Paris and nine in different cities outside the capital. “It was the worst time to launch a brand. The financial market was in crisis, but we were audacious. Nobody had done what we were doing before and we did not talk to anyone. We invested more than one million euros in communication such as billboards and magazine exposure prior the launch, without any guarantee of our ROI. Nobody knew what The Kooples was but people were curious,” said Dreyfus. After six months larger department stores in France, such as Galleries Lafayette approached The Kooples to open concessions, and within a further six months, the company opened 80.
Since the strategy was so successful, it was repeated when the brand launched in the UK–22 stores were opened in one month, following heavy investment in marketing with the brand appearing in print and on buses. Positive public reception allowed the brand’s popularity to grow rapidly and in 2016 the decision was made to launch 12 collections a year; each month features a new collection with its own images, colours, and spirit. Each collection has a specific name and the idea is to appeal to the nationalities from all the countries in the world. When thinking about each collection of the brand, the team tries to cater to each nationality although specific products are created exclusively for the GCC region. The Kooples offers dresses that are longer, more flowing, more feminine and brighter colours. “Now it is hot in Dubai, but not in Chicago or Vancouver or Russia. While we try to cater to the specifics taste of each country we try to keep the DNA of
40 p40-41_Brand.indd 40
9/19/17 9:16 AM
450 stores opened over
1000 pieces created every season
eight years
12% revenue generated by ecommerce
36 countries with
7% online revenue from
The Kooples stores
accessories
15% estimated revenue
30 nationalities working
from accessories by 2020
in Paris headquarters the brand consistent when we create the products by paying attention to the details,” Dreyfus said. The label was created in 2007 to offer male and female fashion simultaneously, and they were inspired by celebrity couples with iconic style, such as Marianne Faithful and Mick Jagger, Jackie Kennedy and Aristotle Onassis, and Jane Birkin and Serge Gainsbourg. They wanted a brand that would offer a mix of Parisienne chic and London’s rock ‘n‘ roll. All the fabric comes from Italy, the embroidery is done by hand, and the clothes have mother of pearl buttons. All the patterns have been made in Saville Rowe in London. Even though the company produces 12 collections a year, the clothes are now done as limited editions. By the time The Kooples opened its doors to its first store in Dubai, in Dubai Mall, in 2014, the brand had grown and spread enough globally to appeal to the number of tourists that make their
way to emirate as both a travel and fashion hub, said Dreyfus. He added that breaking into any new country comes with its specific set of challenges, but making the move into the GCC, starting with Dubai, was straight forward and that came down to having the right partner. “The former CEO of GalleryLafayette moved over to Dubai to accept a position with the Al Futtaim group. We already knew each other and he knew our business. He called us and said we should think about entering the UAE and we should consider partnering with Al Futtaim. It seemed logical to work with them. At the end of 2014 we opened our first store and now we have eight stores in the GCC and the idea is to develop the brand and the website for the region in order to continue our success,” said Dreyfus.
ECOMMERCE Dreyfus and his co-founders understood the importance of
leveraging the internet at the brand’s inception. During each launch in 2008 and 2011, the company introduced its corresponding ecommerce platform. Ecommerce currently accounts for 12 per cent of the brand’s business, boasting about six million annual visitors. The company has grown to accommodate seven difference ecommerce websites–France, UK, Germany, Sweden, Spain, Australia, and America–and it ships to most other countries from France or from Asia. Future plans include offering a service to deliver within six hours of an order within the big main cities in the world, by shipping directly from the stores. Dreyfus estimated that expanding into the accessories market with this handbag launch and by continuing to develop their product offering, The Kooples should see accessories account for 15 per cent of total revenue within the next three years.
WWW.FINANCEMIDDLEEAST.NET
p40-41_Brand.indd 41
41 9/24/17 12:34 PM
START-UP
ALL FOR ONE! Alharith Alatawi discusses how GCC nationals can enter the job market to meet nationalisation requirements and tackle the region’s unemployment
Alharith Alatawi
U
nemployment rates in the MENA region are the highest in the world, more than double the global average, according to the World Economic Forum. “We created OneGCC to address the problem of an increasing unemployment rate among GCC nationals despite the number of available jobs. Last year Bahrain created 70,000 jobs and only 900 Bahrainis were employed, while 30 per cent of our youth remains unemployed,” said Alharith Alatawi. OneGCC, is a GCC-based digital recruitment platform, developed in Bahrain by Alatawi and his two co-founders in 2015, and launched in August 2016. All three previously worked in one of the largest recruitment companies in Saudi Arabia, tasked with filling positions for 500,000 work permits. “We were dealing with around 200 clients, hiring around 3,000 skilled and
unskilled workers and the real issue was maintaining the Saudisation quota set by the Government, which has been increased to about 70 per cent across all industries. To reach that figure the private sector in Saudi is going to have to hire almost six million GCC nationals, which will count towards Saudisation, over the next four years,” said Alatawi. They also struggled to find the right talent was because only five per cent of GCC nationals they engaged with had adequate knowledge of how to write a CV and apply to companies. Alatawi added that job seekers had previously relied on friends and families for jobs, and hadn’t actually approached companies nor put themselves out on the market. A McKinsey Global Institute report, A labor market that works: Connecting talent with opportunity in the digital age estimates that online talent platforms could add $2.7 trillion to global GDP by 2025, while increasing employment by 72 million full-time equivalent positions. A standard CV is no longer sufficient and the OneGCC platform is designed to create concise job seeker profiles, in both English and Arabic. Alatawi said they want to add psychometric analyses and to find out more about the applicants’ personalities and skill sets and the team is working on algorithms that will be able to match job seekers and opportunities instantaneously. “A Saudi client requested around 200 civil engineers, since the Kingdom invested so much in developing its infrastructure, and they had to be able to use AutoCAD. Instead of trying to source that many engineers, we suggested they hire interior designers–they know
how to use Autocad and there is not a need for them in the job market. It was a success story for us. Developing these algorithms that will match skills for different job opportunities with job seekers can be applied to the global market in the future,” he said.
Fundraising
A recent survey by EY found that 70 per cent of young Bahrainis were interested in the idea of starting their own business, twice as many as anywhere else in the Gulf. With the efforts by the Bahrain Economic Development Board, the Bahrain Development Bank, and the number of accelerator programmes, Alatawi said it was becoming much easier for small businesses to ask for funding. C5 a Bahrain-based cloud fund for MENA announced its plans to invest $2.5 million in OneGCC in April this year, the fund’s first investment following its September 2016 launch of its Cloud 10 technology accelerator programme. OneGCC was one of the first companies to graduate the Cloud 10 programme. “Once we went through the programme we had a clear objective, we had a clear business plan, a clear vision, a clear idea, and a clear opportunity and I think that went a long way for us in terms of completing the programme quickly, and securing investment,” said Alatawi. The OneGCC team is focused on refining platform’s technology to cater to the needs of the GCC region, and hopes to reach one million registered job seekers by the end of 2017. Future expansion plans could include servicing countries with nationalisation programmes such as Singapore and Indonesia.
42 p42_Start_Up.indd 42
9/24/17 12:38 PM
Online trading on financial markets
Whatever’s happening in the markets, we’ll help you make the most of it. We are an award-winning broker who offers expert analysis and powerful trading technology so you can seize every trading opportunity. Don’t miss out - open an account today. Trade now or try a risk-free demo www.cityindex.ae INDICES
FX
COMMODITIES
Losses can exceed deposits Authorized and regulated by the Financial Conduct Authority
p42_Start_Up.indd 43
9/19/17 9:19 AM
AWARDS
FINANCEME BUSINESS VISION AWARDS T
he second FinanceME Business Vision Awards 2017 took place earlier this year with record numbers of nominations coming in for each of our categories. The Business Vision Awards are designed to reward everyone from the start-up entrepreneur, to the seasoned medium-sized enterprise owner, the personalities in the sector, and the businesses that support them. Winners across these categories are decided by a leading panel of industry experts, hand-picked for the impartial, yet in-depth knowledge of the SME sector in the GCC region. The calibre of the nominees made the judges’ decision extremely challenging.
First of all we’d like to thank CPI Financial for this Award; this actually means a lot. It’s a stamp of credibility to what we are doing. It actually encourages us to do more and to try to innovate more in the online recruitment space. We hope that we meet our audience’s expectations going forward.” –Ahmad Khamis, Co-Founder & CEO, BLOOVO.com Ahmad Khamis, Co-Founder & CEO, BLOOVO.com receives the Award for Best Start-Up of the Year from CPI Financial CEO, Robin Amlôt.
It gives us great joy to have won the prestigious Business Vision Awards for two consecutive years. We value the recognition by the community, which is a source of motivation for LINKVIVA and a sign that we are on the right track towards further success. This reward is a testament to the unmatched integrity, tenacity, and the genuine efforts of every member of our local and international team, who strive for the happiness of our clients and ensure sustained growth of the company in all fronts.”
44 p44-47_Awards.indd 44
– Ali Shabdar, Marketing Technology Director, LINKVIVA
san,, Ehsan ha Eh usha Nious andd Nio tor an ector Direc gy Dir ology hnolo Techn vedd tingg Tec prove Impro rketin st st Im Marke Mo Mo dar,r, Ma for for abda ard ard Shab Aw Aw Ali Ali Sh the the pt cept acce IVA ac KVIVA LIN LINKV er, er, fic fic l. l. Of Of y y cia cia an an erg erg Fin Fin En En I I ief ief CP CP Ch Ch O, CEO, lôt,, CE Amlôt bin Am Robin m Ro from ar fro Year the Ye of the ess of siness Bu Busin
9/24/17 1:07 PM
Robin Amlôt, CEO, CPI Financial presents Best Business Technology Award to the Dr. Sassan Dieter Khatib-Shahidi, CEO, German Imaging Technologies.
Well we’re very excited and thank you very much. I think vision and innovation is what we’re all about so I think it’s superb to be associated with such an Award. We hope to continue to innovate and win awards like this one.” – Edward Gallagher, Business Development Director of De Boer Middle East Edward Gallagher, Gallagher, Business Business Development Development Director Director of of De De Boer Boer Middle Middle East East Edward receives the the Award Award for for Top Top Services Services Provider Provider from from CPI CPI Financial Financial CEO, CEO, Robin Robin Amlôt. Amlôt. receives
It’s fantastic to be recognised for another year by CPI Financial for winning an award for our service. This year we’ve won awards for not just our creativity and strategy, but endorsed by CPI Financial for the services we provide for SMEs in this market, is fantastic. We’re very, very honoured. Thank you.” Robin Amlôt, Amlôt, CEO, CEO, CPI CPI Financial, Financial, presents presents the the Award Award for for the the Best Best Robin Business Advisory Advisory Service Service to to James James Pass, Pass, Principal, Principal, JPd. JPd. Business
– James Pass, Principal, JPd cont. overleaf
WWW.FINANCEMIDDLEEAST.NET
p44-47_Awards.indd 45
45 9/24/17 1:07 PM
AWARDS
cont. from pg. 45
I think Idriss and I are so focussed on growing the business so when somebody actually acknowledges us we’re always a little bit shocked. We’re grateful to be acknowledged because when you’re so focused, you do not see anything outside your own world. We’re very grateful and humbled by it.” Robin Robin Amlôt, Amlôt, CEO, CEO, CPI CPI Financial Financial presents presents the the Award Award for for the the Best Best Business Business Solutions Solutions Provider Provider to to Joy Joy Ajlouny Ajlouny Co-Founder, Co-Founder, and and Idriss Idriss Al Al Rifai, Rifai, Founder Founder & & CEO, CEO, Fetchr. Fetchr.
– Joy Ajlouny Co-Founder, Fetchr
Thank you so much for choosing me. It is such an honour because I follow FinanceME religiously and I read a lot of your input into the financial market and I’m very proud and honoured to be considered for this. – Omaira Al Olama, Managing Director, ALF Administration Rob Robin in Am Amlôt lôt,, CEO CEO,, CPI CPI Fin Financ ancial ial pre presen sents ts the the Aw Award ard for of of the for Ins the Yea Inspira Yearr to piration to Om tional Omaira al Per aira Al Person Al Ola son Olama ma,, Ma Manag naging ing Dir Direct ector, or, ALF ALF Adm Adminis inistra tration tion..
We entered the Business Vision Awards because manufacturing is not really perceived as sexy or exciting. It’s really nice to be recognised for what we’re trying to do. We’re thrilled for our staff. It’s really exciting for them to win awards; they feel like all the work is worth it. ” Robin Amlôt, Amlôt, CEO, CEO, CPI CPI Financial Financial presents presents the the Award Award for for Top Top Manufacturer Manufacturer Robin to Stevi Stevi Lowmass, Lowmass, Founder, Founder, The The Camel Camel Soap Soap Factory. Factory. to
–Stevi Lowmass, Founder, The Camel Soap Factory
46 p44-47_Awards.indd 46
9/24/17 1:07 PM
It’s fantastic to be acknowledged for the hard work and the innovative ideas that we’ve created at Taylor Sterling and we hope that we can continue to set an example and create best practices for the rest of the industry.” – Marcus Taylor, Managing Partner, Taylor Sterling Robin Amlôt, CEO, CPI Financial presents the Award for Recruitment of the Year to Marcus Tay Company lor, Managing Partner, Taylor Sterling, and his team.
We’re really excited. We spend a lot of time with institutional investors and banks, and we have lots of conversations globally with these companies. To be recognised in a publication that they would probably read is fantastic for us. I think it shows that we run a pretty successful business but also a business that has good foundations. At a corporate level, it’s one thing to be recognised for the quality of our designs, interiors and landscaping, but to be recognised for the business side is quite different. It’s nice for our team behind the scenes.” – Steven Charlton, Principal & MD, Perkins+Will
Robin Amlôt, CEO, CPI Financial presents the Best Business Consultancy Award to Steven Charlton, Principal & MD, Perkins+Will.
Robin Robin Amlôt, Amlôt, CEO, CEO, CPI CPI Financial Financial presents presents the the Award Award for for Best Best Home Home Grown Grown Brand Brand to to Steven Steven Allen, Allen, Head Head of of Corporate Corporate Communications, Communications, RAK RAK Ceramics. Ceramics.
WWW.FINANCEMIDDLEEAST.NET
p44-47_Awards.indd 47
47 9/24/17 1:07 PM
BEHIND THE SCENES
Sheikha
Reem Al Khalifa The founder of the Green Bar wanted to create completely natural products that represented Bahrain I only use my own products or I will use something that I find on my travels that is natural. Our products are really made for different times and different seasons. There is a synergy between the ingredients in the products because most of them are grown here.”
Reem Al Khalifa
48 p48-49_BTS.indd 48
“I did need to have an official space, so I came to the Riyadat Women Business Incubator. The rent is covered by Tamkeen’s business incubator scheme and the paperwork was handled for me. The space has been very helpful, because we have to dry our herbs. We do not mix oil and water; the herbs need to be completely dried until they can be infused. It’s a simple thing, but it’s so important that the bottles and herbs are completely dry.”
9/19/17 9:29 AM
I make the first batch of the products, but I have a team for manufacturing.”
“The packaging comes from the US. I have a good relationship with my supplier and I have used them since I started out when I was only buying 15 bottles each time. I have flexibility with them. All the screen printing and foiling is done in Bahrain.”
“I've always had my ecommerce platform. Most of our clients are from the GCC. We have a lot of Bahraini, Kuwaiti and Emirati locals using our products, as well as a growing number of expats. We offer free shipping for orders over BHD 70. We have so many different products in different categories; if people bulk up their orders, they really appreciate the free shipping, which goes a long way.” t profitable iness is no e doing! You s u b a s e “Sometim ourself what you’r e you know y s so you ask ht through it becau ut it really B g . fi rk to o e w v l a il h ally it w ontinuous that eventuf persistence and c business is o e takes a lot nt. I feel like now th .” e m re e e v h w ro e p im going som
se, as our incen ducts, such rs outside the ro p r u o f o e uye “Som foreign for b arcoal could be verymmon for us to have ch have to t co h ig is m It . e C ls C G anyone e t u not be b , ay se m u o h h in the lly, whic ca fi ci e o.” sp d al ly buy charco g they would normal somethin
I want my clients to be informed so I put a lot of information on the labels. Our new packaging is in English and Arabic.” WWW.FINANCEMIDDLEEAST.NET
p48-49_BTS.indd 49
49 9/19/17 9:29 AM
LAST WORD
Spinning plates SANJIT GILL, GENERAL MANAGER AT ICLP DISCUSSES RUNNING A MULTI-CULTURAL COMPANY WITH THE CONFIDENCE OF DON DRAPER
Sanjit Gill
What does your current role involve on a day-to-day basis?
As the General Manager of a busy agency my days are varied and I have to spin quite a few plates at once. I oversee the business development plans and ensure that the teams are engaging our prospects and existing clients with the right products and solutions. I need to keep a close eye on the profit and loss for the business which requires a lot of budget planning. I often have trips to our group HQ in London to make sure that my teams are all up to date with what is happening on a global level.
How do you prepare for the day ahead?
I would love to say that I go for a six mile run and have a green juice, but that would not be true! Every day is different and a balance has to be struck between managing the daily running of the business and always being available for our clients should they need me or my team. One way in which I can try to prepare for the day, which is entirely within my control, is to spend time to prioritise the must-do tasks for the day ahead.
What is the most challenging aspect of what you do?
on a project-by-project basis and we did not get a lot of retained work. We spent a lot of time pitching for one-off projects, making it really difficult to manage and forecast the profitability of the agency. I regret maintaining that status quo for too long. Ultimately the business did not survive and it probably held my career back a couple of years. I desperately wanted that business to work but often you have to admit when something is not working and move on.
If you could thank one person for helping you become the person you are today, who would it be and why?
WHAT FICTIONAL CHARACTER DO YOU MOST IDENTIFY WITH?
The diversity of the UAE is one of the reasons I love it here so much, but to get the best from our business we always have to be mindful that a one-size-fitsall approach does not work. Even in our ICLP office in Dubai we have 16 different nationalities. Our HQ is in London and altogether Collinson Group has almost 2,000 employees across 19 countries. What might be common practice in one country may not be in another, so finding that balance across lots of cultures can be a challenge.
My first job in the UK was for a mail order company as a Customer Information Analyst. I applied data analytics to glean really valuable customer insights and started working more closely with the marketing teams to benefit from that information. The Brand Director recognised my ambition and capability in the area and promoted me to Brand Manager. Sometimes it’s worth recognising someone’s interest and passion for something in a different area and giving them the chance to make that move. If not for that chance then I may never have gone into marketing and I probably would not be here in Dubai now.
Describe your biggest failure in business and what it taught you. When I was the Client Services Director of a UK-based direct marketing agency we hit a period of tough business conditions. Too many clients engaged us
I’ve just started watching Mad Men so I want to say Don Draper. I like his work style–he is a bit of a maverick but is full of confidence in his ability and isn’t afraid to get things done his own way. I am only on season one so I have no idea how he turns out.
WHAT WOULD YOU MOST REGRET NOT HAVING DONE BY THE END OF YOUR LIFE? Running my own business.
IF YOU RULED THE WORLD, WHAT WOULD YOU CHANGE? At the moment, probably Brexit!
WHAT SUPER POWER WOULD YOU LIKE TO HAVE? To be able to predict the future.
50 p50_Last word.indd 50
9/19/17 9:52 AM
AS EASY AS GCC! THE TAXMAN IS COMING… AND that taxman could be you!
VAT – As Easy As GCC! is a special supplement to be published by CPI Financial with a long-term shelf life as a handy reference guide. of businesses facing the introduction of new tax rules.
HI-IMPACT SOCIAL MEDIA SOLUTIONS FROM CPI FINANCIAL
Omer Hussain | Sales Director Nikhil Mathur | Business Development Manager - Finance ME
CPI Financial FZ LLC • PO Box 502491 Al Shatha Tower, Office 1209 Dubai Media City, Dubai, U.A.E. Tel: +971 (0) 4 391 4681 • Fax: +971 (0) 4 390 9576 • www.cpifinancial.net
FME 60 cover.indd 2
9/24/17 12:54 PM
ISSUE 60
ISSUE 60
LETTING PEOPLE AND TECHNOLOGY CREATE THE FUTURE
The firm’s success can be attributed to investing in people and technology. – Philippe Ghanem, CEO and Vice Chairman of ADS Securities
LETTING PEOPLE AND TECHNOLOGY
CREATE THE FUTURE INSIDE
Wearable art (pg 16) Assisting GCC job seekers (pg 42) FME 60 cover.indd 1 Co resized.indd 1 Comprehensive Leasing
21/05/2017 16:10
P16
P42 9/24/17 12:54 PM