This article appeared originally in Gulf News: link to original article
I was taken on a tour once of the Al Falah Compound in Abu Dhabi. For those who haven’t been there yet, the place is awesome.
I won’t get into the details of how every single thing was taken care of, from design to size and so on, but rather focus on what’s missing. The friend who took me on that tour proposed to Aldar Company a business idea that would benefit the entire compound (I didn’t refer to it as Aldar Surooh for a reason that you would figure out if you give them a call).
Anyways, the compound that consists of 5,000 houses lacks very basic, though essential, outlets. By that I mean a super/hyper market, laundry services, restaurant/catering services and a clinic/pharmacy, besides others. And for you to get from the compound to anywhere else, it’s no less than 30-40 minutes in all directions.
Now the best part in all of this is yet to come. For you to start a business, you should submit a full proposal that includes every single detail along with feasibility studies which makes that business idea ready to implement, not necessarily by the person making the proposal.
The reason I mention this story is that you do not need to come up with a multi-million worth of an idea to start a business. Let’s keep that for Silicon Valley. If you could come up with an idea that satisfies a need, then you can guarantee a cashflow and breakeven in no time.
This is exactly the case with Al Falah Compund. Not to kill innovation, but you got to ensure that the base that you are building on is right for entrepreneurship to prosper. In all Adnoc petrol stations and a few others, you would find a coffee machine that reads “Coffee Planet”.
The guy that established this is a true entrepreneur. While studying in Knowledge Village, Dubai, he recognised that there were no coffee shops over there. And instead of getting a franchise, he started his own.
Did the business do well? Yes. He satisfied a need in the market, a few thousands students and faculty, and didn’t stop there. The machines that you find in different petrol stations are the expansion of his business, alongside selling the very same coffee beans used in the coffee shop. Economies of scale are in full operational capacity!
I would agree that coming up with an exceptional idea that would lead to a billion dollar valuation is hard. But that doesn’t mean that you can’t make money. I am not going to lecture you on how you should do what you love and that money will come with it.
Instead, I encourage each and every one of you to find a need in the market and to materialise on it. If that need is a niche one, you have a better chance of bringing about an entrepreneurial evolution. A while ago, a website that deals with Arabic Internet Services, established in Amman, decided to acquire all the famous forums in the Mena region.
While building an empire of forums with many members participating in debates of all topics, the website transformed itself into a favourable marketing platform for companies wanting to sell to more than 350 million people. Later on, Yahoo decided to acquire this website with all of its affiliated services for no less than $80 million. Not only that, but such an evaluation was achieved in 10 years only! I am referring to Maktoob by the way.
In the UAE, interest-free funding for entrepreneurs comes from Khalifa Fund, Dubai SME, Ruwad and additional funding is available through banks. However, that is not an easy task. Ideas that survive and qualify for funding are not all great, and the ones that are great are not usually sustained by their initiators or their funding facilitators, who part at breakeven.
This is besides the usual communication issue where ideas either hit a dead end or get lost in the bureaucracy of the respective funding institution. Conclusion: no major success.
What young people need to understand is that we expect from them much more than just starting a cashflow kind of business, and that we expect them to be self-employed and to start hiring people; because it’s the only way out for the job market. Nevertheless, we expect businessmen to get into an angel investing mood or even a venture capitalist for the country to witness a new Emaar and create a success story similar to Dubai Mall in concept, but unique in its entirety.
Now the last thought that I want to leave with is this: do jobs added every year by existing companies match the number of university graduates?