Fadi Ghandour has played a pivotal role in guiding entrepreneurship in the Middle East. The Aramex founder acted as both investor and mentor for Maktoob, which was famously acquired by Yahoo! and provided inspiration for many in the region hoping to see entrepreneurship as a viable means of making a living. Maktoob in turn supported Yamli, Lebanon’s own success story. Ghandour left his position as CEO of Aramex in 2012 and is now focusing on Wamda and building an entrepreneurship support network. He talked with Executive Magazine from Amman, Jordan, on the importance of role models and the role of the private sector in entrepreneurship.
You are the founder of Aramex and were CEO for 30 odd years. What do you consider the most important development for entrepreneurship in the Middle East since Aramex was founded?
I think there are several elements here, and there are several events that have created the change process. Maybe [in particular] the focus on entrepreneurship, and [the increased] focus on the environment for entrepreneurship across the region. There has also been a proliferation of incubators and accelerators, while governments have created funds to support entrepreneurs.
Maybe also [important is] the proliferation of information, of a global village, of information dissemination around the world. People become affected by what they read and the role models they are inspired by. The internet gets people to understand what it means to be an entrepreneur and to build a business.
If you want to talk about the region, Maktoob’s transaction with Yahoo! [in 2009] contributed to the dissemination of the story that you can actually build a business over the internet and actually create some wealth and it has inspired a lot of people to do that. That, in my opinion, has contributed.
At the same time, we have the challenge of youth — of finding them jobs, education — the problem of unemployment. This has created a lot of attention in various governments to see if they can create an environment for creating jobs, and linking education to match the job market. This has given a lot of attention to entrepreneurship, as it could be one of the ways to address the issue of youth and job creation around the region.
As an investor and a mentor, you provided considerable support to Maktoob. This team in turn gave support to Yamli, one of Lebanon’s own success stories. How important is this type of mentorship for entrepreneurship in the region?
I think next to access to capital and finance, mentorship is one of the most important things that a startup can have. It cannot be overestimated how critical this is. There is a big responsibility on the shoulders of entrepreneurs that have made it — business people, who can mentor a startup. Because if you ask entrepreneurs and startups, they will tell you that they need someone to help, to mentor them. This is quite critical.
What is the value of success stories such as Aramex, Maktoob and Yamli for fostering entrepreneurship in the region and in the Levant?
I think it’s extremely important because there’s nothing better that tells a story and that inspires people to do things than stories that have been successful. So role models and success stories have been extremely important. And that’s why I always talk about the role of media for bringing out these success stories. Role models inspire people to emulate them. They think “if he can do it, I can do it”. The world is filled with inspiring people that have been copied, emulated, and looked up to to get people to act.
The Arab Spring is about role models. Even the Mohamed Bouazizi case in Tunisia made people go to the streets. It’s quite powerful. And I think that the founders of Maktoob and Yamli are the role models of the Arab world. I think people have established companies because they saw that “if they can do it, we certainly can.”
You mentioned in your 2012 ArabNet talk that according to the Arab Youth Survey the percentage of youth in the Levant who want to start a business is much lower than in the rest of the Arab world. Why do you think that is?
I don’t know. It could be that a lot of the kids come out of the region because of the political turmoil in the Levant; they have an aspiration to leave. A number of youth in the Levant want to emigrate. It’s part of the challenge, again, of retaining talent, of retaining youth in view of massive political and economic tensions. The Syrian war doesn’t help; the amount of refugees doesn’t help. There are a lot of pressures to create a livelihood and a lot of youth might think that emigrating and leaving is the right thing to do. But given that there are a lot of entrepreneurs popping up in the Levant, we have to be careful about these studies.
How big of an impact do you think entrepreneurship can have in Lebanon and in the region?
Look, I’m very biased. I think entrepreneurship is probably the most important element today in solving the issue of unemployment in the region. You also have to think of entrepreneurship not just as going out and creating a business, but learning skills and critical thinking that [mean an entrepreneur] becomes a solution-minded individual and activist; someone who refuses the status quo. These are people who go out and even have a better chance in getting jobs. It improves job chances, and if you still don’t have a job you have skills to build a business.
What is the role of the private sector in helping the new generation of entrepreneurs? What can private companies do to support entrepreneurship?
The private sector and people that have made it, engaged in private enterprise, and have experience under their belt in trial and error and have experience of the marketplace — this is the experience that the private sector brings: mentorship, bringing knowledge to youth.
You make your organization available for these young entrepreneurs to buy their products, mentor them, or create internships in organizations that can come and work and understand the way private companies operate. They can also create an entrepreneurship environment which can foster this mentality and foster these skills inside the region.
People in this domain can be private investors, participate in funds, or can lobby governments to allow young entrepreneurs to establish businesses faster or participate in business plan competitions.
The private sector is at the forefront. Today we see many government initiatives, but government initiatives alone lack a comprehensive view. Governments are important but without the private sector as a second base to foster entrepreneurship you’re not going to have it.
Because the public sector doesn’t understand what entrepreneurship is. They just don’t. They know it’s important, but they think it’s a policy. It’s not just a policy, it’s a whole culture that needs to be fostered by the private sector and entrepreneurs by definition.
You interact with many early-stage companies in your various roles at MENA Venture Investments, Abraaj Capital, and Wamda. What is the most valuable insight that you can give to budding entrepreneurs in the Middle East?
There are many things that entrepreneurs need to know. But the most important thing I think is that you are in the process of building a business. And that’s a long-term process, it doesn’t happen overnight. It’s about building a team, and creating an organization that has value. It’s not about building for exits. You can sell your business if you want to do this by building your business, but entrepreneurship is not about making a quick buck.
Where do you see entrepreneurship taking the Middle East in the next five, ten years?
Again, I go back to previous answers on entrepreneurship being the most important element in solving the issue of job creation. Entrepreneurship is the heart of it. Entrepreneurship in its holistic view — from education all the way up to building a business — is going to be at the heart of solving unemployment in the region and addressing the issue of youth in the Arab world. That’s the biggest challenge: how to create talent and an environment that fosters and cares for entrepreneurs. And that’s from cradle to grave, if you want to create students that have entrepreneurial minds.