Hetal Pawani's Jam Jar was ranked in the top 100 small-to-medium enterprises by Dubai SME. Razan Alzayani / The National
Hetal Pawani's Jam Jar was ranked in the top 100 small-to-medium enterprises by Dubai SME. Razan Alzayani / The National

Business

How thejamjar manages the art of creative change

The Life: We follow up with Hetal Pawani of the art studio thejamjar, which has learned to adapt its business model to survive.

Sananda Sahoo

December 13, 2012

Hetal Pawani started thejamjar, a platform for creative minds, in Dubai in 2005. Six years later, her company was ranked in the top 100 small-to-medium enterprises by Dubai SME. Originally from India, Ms Pawani, 33, talks about what makes her business work.

The last time we spoke, in 2008, you had a gallery and a studio. Have you expanded on that front?

We actually closed down the gallery and turned the 1,000-square-feet space into a not-for-profit project with a focus on artist residencies. We call the artist, or select them from applications, and they work on mixed media, found objects, or we have collaboration of disciplines such as architecture in visual art. It was formally launched in March and we have our third ongoing artist residency. They use the space for a month, interact with other artists and that leads to an exhibition. We assist with materials such as video, photography and text. The current artist in residency is Walid Al Wawi, who lives in the UAE.

How do you finance this and plan to expand it?

We support ourselves and though currently we focus on UAE-based artists, we plan to link up with artists' mother countries for regional collaboration.

Have you opened thejamjar cafes across the UAE as you had planned?

Those have always been on the agenda. We are scouting for locations. It has to be on the street level. We have not been attracted to malls. We have been offered space by malls last year and this year and some retail spaces, too. But we are looking at the footfall, parking facilities, how it would be different from what we are doing here. But we hope to open one in March or later next year.

How have your staffing and revenues grown since 2008?

We had around eight people then. Now we have 17. Our revenues have grown, not significantly, but there has been a steady growth. We have a slightly conservative approach. We have not hired 50 people during the boom period. We have a niche offering and a community approach and have maintained that.

Do you have any plans to expand thejamjar into Abu Dhabi?

We are constantly researching opportunities for that, but need to work on a lot of planning.

What are your major sources of income?

The art consultancy brings 60 per cent of the revenues. It includes creative learning and commissioning of artists - supplying artwork to homes and offices. The rest comes from renting out studio space to artists or amateurs and events such as corporate parties. We give unlimited canvases and acrylic paint for studio rent sessions starting at Dh100 for two to four-hour time slots. Every day, on average, we have five to 10 people.

UAE currency: the story behind the money in your pockets

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”