It’s been 20 years since I started my business and I look back at all the lessons learnt, wishing I had done so many things differently despite being grateful for where I am today.
A key learning was how important it is to manage your money properly when starting your own company.
Every entrepreneur chooses their own path and makes their own choices on what company they want to build.
Some choose to raise multiple rounds of capital to build very large organisations, which are well-funded from day one and have the bandwidth to take their products to market while compensating their founders reasonably well.
This model is well-established globally but comes at the obvious cost that founders lose much of their ownership of the company’s stock and must often dilute their vision to majority owners, who are more focused on short-term returns than building a great long-term business.
It is also a model that is now under pressure thanks to rising interest rates, which raise the cost of capital and make borrowing much more expensive.
It is no surprise that in western markets, investment activity and mergers and acquisitions have declined dramatically and money towards new ventures is shrinking at a significant pace.
In the Middle East, some of these trends are now occurring, but have not reached the same severity as in the West, thanks to high liquidity and strong government balance sheets.
Having said that, beware that the region is not immune to global trends and investment in start-ups and young businesses will subside eventually, at least for a certain period.
Other entrepreneurs choose to focus on being profitable from an early stage and use free cash flow to grow the business.
This often means you are bootstrapping your way to success (or failure) – not only in your business but in your personal life as well.
I chose this path and when I look back at it, I am happy that I did: it gave me independence around my vision, how to build the company and what day-to-day choices I made.
It also empowered me to say no to investors or bankers who wanted me to re-engineer the business for short-term gain as opposed to long-term success.
Most of all, it forced me and the entire team to always be disciplined with our money; we stretched every dirham and dollar to get maximum returns across the organisation.
It also shaped a thrifty mindset, which helped to keep costs low and investment in the right places.
Ironically, it was only when our profitability grew so much that we started to relax our discipline and ended up making mistakes and not being as efficient as we used to be.
But, thanks to a deeply ingrained fiscal discipline, we quickly went back to our roots and are bootstrapping again, even though we have tens of millions in revenue, high profits, and a global footprint.
This approach keeps what is now a large organisation lean and efficient, capable of investing, acquiring, and building, while rewarding our hard-working team for their effort and creativity.
However, bootstrapping comes with a serious cost. On a personal level, I remember living for years on a “no budget”. Money was so minimal I had to reduce my personal expenditure to the most basic elements and avoid all forms of holidays, luxuries and non-essential buying.
There were times when this created stress and fear; on more than one occasion, I pondered giving up on this approach and returning to employment or bringing on investment, which wanted to reshape the business into something else.
I did not. Defeating fear and being confident that ethics, perseverance and value would lead us to success became a crucial lesson in life, which I continue to follow even now.
It is essential to remember that your team is also impacted by bootstrapping, and they will often not only be paid less than market value but also have less money to invest in the business than our competitors.
You must make sure they are rewarded in every way possible: from simply saying a heartfelt thank you to being with them on the front lines. Compensate for the lack of cash with an abundance of heart and resilience and you will find the greatest source of capital in that.
And, when the money does start coming, remember those who stood by you from the start, even in the smallest way, and share that wealth and success with them.
At one point, we accepted some external investment to fuel our global expansion, but it was at less than 20 per cent of the company’s shares and never sidetracked us from fiscal discipline and building a company growing through value and profitability.
As the world’s investment climate changes, easy money-fuelled start-ups will cede ground to modern businesses that have old-fashioned ethics around treating people well and keeping more money coming in than out.
Follow that principle and you will succeed, no matter how hard the circumstances.
Mazen Nahawi is the founder and chief executive of CARMA
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Under the UK government’s proposals, migrants will have to spend 10 years in the UK before being able to apply for citizenship.
Skilled worker visas will require a university degree, and there will be tighter restrictions on recruitment for jobs with skills shortages.
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The biog
DOB: March 13, 1987
Place of birth: Jeddah, Saudi Arabia but lived in Virginia in the US and raised in Lebanon
School: ACS in Lebanon
University: BSA in Graphic Design at the American University of Beirut
MSA in Design Entrepreneurship at the School of Visual Arts in New York City
Nationality: Lebanese
Status: Single
Favourite thing to do: I really enjoy cycling, I was a participant in Cycling for Gaza for the second time this year
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Tightening the screw on rogue recruiters
The UAE overhauled the procedure to recruit housemaids and domestic workers with a law in 2017 to protect low-income labour from being exploited.
Only recruitment companies authorised by the government are permitted as part of Tadbeer, a network of labour ministry-regulated centres.
A contract must be drawn up for domestic workers, the wages and job offer clearly stating the nature of work.
The contract stating the wages, work entailed and accommodation must be sent to the employee in their home country before they depart for the UAE.
The contract will be signed by the employer and employee when the domestic worker arrives in the UAE.
Only recruitment agencies registered with the ministry can undertake recruitment and employment applications for domestic workers.
Penalties for illegal recruitment in the UAE include fines of up to Dh100,000 and imprisonment
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- Specialist robotics and science laboratories
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- Upload the training certificate from a centre accredited by the GCAA
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- Fly it within visual line of sight
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- Should have a live feed of the drone flight
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