Arif Alawi, CEO, Dubai Cultiv8

This text is part of the 2022 version of Entrepreneur Center East’s annual Comply with The Chief sequence, during which enterprise head honchos from the area speak technique, industry-specific ways, {and professional} challenges as they lead their respective companies to success.

“Have they got a imaginative and prescient, or is cash the one curiosity?” In his function because the CEO of Dubai Cultiv8, this is likely one of the questions that Arif Alawi likes to ask entrepreneurs that search help from the Dubai-based funding fund. Evaluating a startup’s founding staff on every part from their imaginative and prescient and fervour to their expertise and expertise, Alawi and his staff at Dubai Cultiv8 additionally contemplate a bunch of different elements. These embody the answer’s differentiating think about a aggressive market, revenues and earnings, consumer acquisition prices, or its lifetime worth (“How a lot can the corporate anticipate to revenue from a buyer?”). Additionally, the Dubai Cultiv8 staff appears to be like on the firm’s marketing strategy, progress technique (“We venture 5 years into the future- when will this venture hit break even and turn into worthwhile, and the way a lot time will it take?”), scalability, and exit plans.

The questions Alawi poses supply a glimpse into the mindset with which he leads the cost at Dubai Cultiv8, an initiative of the Mohammed Bin Rashid Fund for SMEs, an entity established by H.H. Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice President and Prime Minister and Ruler of Dubai, in 2012. Dubai Cultiv8 itself was launched in 2018, and has been chaired by H.E. Abdulbaset Al Janahi, CEO of Dubai SME, an built-in division of the Emirate’s Division of Financial Growth. Alawi describes Dubai Cultiv8 as a Shariah-compliant funding agency that provides “cutting-edge options for buyers,” all of which is regulated by the Dubai Monetary Companies Authority. “We outline ourselves as an funding arm offering two providers: advisory providers (offering professional recommendation, structuring the corporate, elevating capital, formulating enterprise plans and monetary fashions, and guiding by every stage), and investing in firms by fund creation,” he explains.

Alawi additionally provides that his enterprise is behind the Dubai Cultiv8 Know-how Fund, a US$100 million fund specializing in investing in growth-stage know-how firms, both positioned within the UAE or overseas, that goal to shift their operation wholly or partially within the nation. Because the UAE’s first public-private partnership within the enterprise capital sector, Alawi factors it to being a key benefit for the agency. “Most firms are privately owned by households, people, places of work, or ex-bankers, however we’re differentiating and positioning ourselves as a distinct segment incubator,” he notes. “We clear the way in which for SMEs to enter and develop within the UAE market with out monetary stress.”

For Alawi, whose profession trajectory has seen him launch a number of funding and asset administration companies throughout the GCC, in addition to play management roles at numerous monetary enterprises within the area, he appears to be particularly well-suited for his function at Dubai Cultiv8- and we are able to affirm this as he tells the story of how he got here to be related to the enterprise. It began with a dialog he had with Dubai SME’s Al Janahi in 2017, when he was engaged with the latter’s enterprise as a strategic advisor for particular tasks and startups. “My ideas had been that if the initiative needs to help SMEs which might be contributing to the UAE economic system, we’ve got to deal with native in addition to worldwide startups,” he recollects.

“Native SMEs already kind round 90% of firms, particularly in Dubai. Out of 100 concepts, there are solely two or three concepts being acquired by enterprise capitalists or angel buyers. After presenting the concept, we established an funding arm- any idea with a possible for progress, we’d help and spend money on, somewhat than simply financing it. This manner, we additionally acquired transparency of the money circulation. That is the place the concept for Dubai Cultiv8 got here from. Native SMEs who want financing go to Dubai SME, and those that want funding and enterprise recommendation come to Dubai Cultiv8, so, we complement one another, and, collectively, we do not miss out on any SME that wants assist.”

Because the CEO of Dubai Cultiv8, Alawi is chargeable for creating the entity’s overarching marketing strategy, whereas additionally guaranteeing it encourages and attracts worldwide entrepreneurs to arrange and increase their companies within the Emirate by providing related funding and providers. In fact, together with that, his function additionally consists of recruiting expertise the world over to place Dubai and the UAE because the go-to hub for buyers and entrepreneurs. “Contributing to the UAE authorities’s aim of launching and helping firms to stimulate financial progress has been a spotlight of my profession at Dubai Cultiv8,” Alawi states.

However what does it take to be a part of Dubai Cultiv8’s portfolio? “Our funding philosophy is to deal with firms established within the UAE and have plans to increase worldwide, in addition to firms who’re based mostly elsewhere, however want to increase into the GCC, notably the UAE, with operational branches,” replies Alawi. The general goal finally, Alawi states, is to draw extra companies to develop within the area and appeal to expertise globally, whereas creating job alternatives for each locals and expats within the UAE. And Dubai Cultiv8 is definitely doing its part- the agency has thus far invested in seven totally different firms, with two headquartered within the US and having a base within the UAE, whereas the opposite 5 are based mostly in Dubai. Its portfolio consists of startups like UAE-based automotive sharing firm Udrive, New York-headquartered on-line moral funding platform Wahed Make investments, and Dubai-based last-mile supply startup Fodel.

Wanting on the present state of the MENA entrepreneurial ecosystem, Alawi believes that the UAE has undoubtedly emerged as a most well-liked location for brand spanking new companies within the MENA area. Based on him, the sectors which have potential for additional funding embody e-commerce, fintech, healthcare and wellness, fee gateways and pockets options, and gaming platforms. Alawi provides that he and the Dubai Cultiv8 staff are additionally contemplating nascent industries, and says “Now we have our eye on crypto, which is rising quick, and has many platforms right here for it to develop. The NFT enterprise is [also] simply rising right here; we began with digital artists, however sooner or later, it would take over the world.”

And for these of you looking for steering to develop your respective companies, Alawi has loads of sensible recommendation to share as nicely. First off, he says, develop a transparent advertising and marketing and gross sales technique. Plus, he tells entrepreneurs to ask themselves, “When you’re pondering of increasing and promoting the corporate in the future, there ought to be exponential progress in purchasers. Is the product scalable abroad?”

Different ideas embody making an attempt to extend buyer retention by after-sales help and loyalty packages, in addition to to develop strategic partnerships with service suppliers. Search like-minded folks round you, he adds- taking part in networking occasions is an effective approach to try this, for example. “Founders ought to search for steering proper from the set-up,” he says. “After getting an thought, meet with an professional for steering on how one can develop the enterprise. Typically, I’ve seen folks develop concepts and pitch them, however there are a number of gaps.” On the finish of all of it, he says entrepreneurs ought to simply bear in mind one factor: “Begin small, and develop slowly.”

Associated: Comply with The Chief: Dima Ayad, Founder, Dima Ayad, And DAC Communications

The Not-To-Do Listing: Dubai Cultiv8 CEO Arif Alawi lists errors entrepreneurs make when approaching buyers

1. Overvaluation in keeping with market traits “An investor is not only taking a look at market traits, but additionally on the startup’s progress risk. Some SMEs state that the corporate will develop 1,000% in a single 12 months, however this is not attainable in each market and {industry} and for sure merchandise.”

2. Lack of a transparent imaginative and prescient “Bringing in funding entails many individuals. And not using a plan of how many individuals an organization wants throughout totally different intervals, one runs out of money quick, and in future rounds, the buyers will see the money circulation and refuse to speculate.”

3. No clear market understanding “Folks are available with an incredible thought, however they do not know who their purchasers are. Are they specializing in B2B or B2C? All people can’t be your goal market. Therefore, with out the consumer base, an correct valuation can’t be shaped both.”

4. Deciding on unsuitable companions “Many are inclined to deal with capital solely, with out contemplating the ramifications of the unsuitable funding. These days, firms do not want $1 million in funding; $200,000-500,000 is sufficient to develop till the following spherical.”

5. Making a gift of an excessive amount of of their firm “If a founder does not have anybody to help the enterprise, they could surrender 60-70% of the corporate, and as soon as they progress to the following spherical of funding, they find yourself with 2-3%, after which, they will not have sufficient energy to direct the corporate based mostly on the preliminary imaginative and prescient.”

6. Operating a one-person-show “Some tasks are began by a single one who believes of their product, however does not imagine within the folks round them. The founder is probably not recruiting the best folks, and they’re doing every part from advertising and marketing and gross sales to pitching to buyers themselves. They do not know when to herald buyers and at what valuation.”

7. Not having an advisory board “Typically, technical consultants who’ve little to no data of enterprise create a enterprise, however they do not know how one can promote it and at what value, or how one can successfully promote shares of the corporate. They do not have monetary or funding advisors or consultants to information them on the technique round them, and they’re additionally unwilling to provide outsiders a stake. You want an advisory board to information you, and improve the worth of the corporate and model.

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