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Winners at growing their business

A showcase of entrepreneurial success

by Maya Sioufi

What do recycled electronics, olive oil and an online game have in common? They are the products behind the three companies that won the “Grow My Business” competition, a joint initiative between the Beirut Traders Association, the MIT Enterprise Forum for the Pan Arab Region and Bank Audi. The competition’s aim is to encourage entrepreneurship in Lebanon and support the development of the private sector. After 30 teams presented detailed business plans in front of a high-profile jury, three teams were granted awards. The first prize of LL50 million ($33,200) went to AD Tech, the second prize of LL20 million ($13,300) went to Olive Trade and the third prize of LL10 million ($6,600) went to Wixel Studios. Executive sat with the owners of each company to discuss their business model and expansion plans.

AD Tech – Recycling electronics 

When you renew your laptop or your smartphone, you have three options in Lebanon for disposing your used electronic device: toss it, sell it or give it away. AD Tech aimed to change that when it launched last year. The company started out importing high quality used electronics from the United States and selling them to several resellers in Lebanon. AD Tech sold more than 2,000 units in Lebanon last year and generated revenues of $200,000. “After one year of experience, we saw a huge market for used IT electronics,” says AD Tech founder Joseph Massih.

This observation led the team of four to develop an expansion plan into a new line of business: a waste management program. The plan, for which they won the competition, involves acquiring used electronics from end users in Lebanon, both corporations and individuals, and then either dismantling these products if they are obsolete or selling them to specific resellers in Lebanon and abroad. “We are going to encourage electronic recycling,” adds Massih. He expects that this expansion plan will cost between $200,000 and $300,000 in a first phase, as they will need to upgrade their current warehouse based in Amchit. Massih expects the plan to launch in six months and increase revenues by 40 percent within the first five years. While the prize money from the competition will be used towards this purpose, it covers only a minimal share of the total cost and AD Tech is currently looking to complete the financing of the project.

The long-term target of AD Tech is to raise awareness about the benefits of recycling and eventually develop a recycling plant in Lebanon, which could become a hub for the Arab world. “Awareness of recycling does not exist in Arab countries,” says Massih. “We hope to start it here and go with it abroad.”

Zejd  the Olive trade

Under the brand “Zejd”, meaning olive oil in the language of the Phoenicians, who are said to have been the first people to grow olive trees, Youssef Fares started selling products derived from Lebanese olives in 2004 through his company Olive Trade. It now sells products such as soaps, flavored oils, green and black olives and stuffed olives (with around 15 different types on offer) and brought in $300,000 in revenues last year. The olive trees used for the products come from land Fares owns in his native village in the Akkar region, as well as from lands managed for farmers in villages surrounding Akkar. The products are sold in high-end specialized stores in Lebanon such as Aziz, to high-end hotels and restaurants such as Le Grey, while also being exported to the US, France, Switzerland and Japan. Olive Trade, made up of four team members, entered the MIT competition to expand and open a retail shop in Ashrafieh called “House of Zejd” within the next month, according to Fares.

The retail store is expected to raise sales by $100,000 in the first year. The LL20 million won at the competition will only cover 15 percent of the cost of the shop. The remaining will be secured from self-financing and from a bank loan “which I have already received approval for,” says Fares. “There will be also be an olive bar for people to come and taste the olive oil before buying it as well as events explaining olive oil. It’s a shop but it is also an awareness about the oil product.”

Wixel Studios – Online Arabic applications

Do you want to choose between Hassan Nasrallah, Saad Hariri, Samir Geagea, Michel Aoun and other prominent Lebanese political figures and pitch them against each other in a street fight? That’s what the online game “Duma” at Wixel Studios allows players to do. Initiated in 2008 by Karim Abi Saleh, Rein Abbas and Ziad Feghali, all three former employees of Redmond- based Digipen, a leader in game development education, the company has so far been focused on “advergames” (games for advertising purposes) such as the ones done for Kit Kat and Almaza and “edugames” (games for education purposes), such as “The Civil Guardians”, a game initiated by the Lebanese Civil Defense Department and the European Union with 125,000 copies distributed to Lebanese schools. Covering the Middle East and North Africa region, Wixel Studios generated $120,000 in revenues last year.

The model of Wixel is now shifting as the team of four — with plans to grow to seven by the end of the year — will no longer provide games for advertising and educational purposes, and will start developing mobile games for the Arab consumer available through the iTunes store and Android market. “There is only a little amount of applications in Arabic,” says Ziad Feghali, one of the founders. “Our plan is to create valuable Arabic mobile content.”

With funds raised this year — an amount the company refused to disclose — from venture capitalists Berytech and Middle East Venture Partners, Wixel Studios will launch its first game, Abou Ahmad el Arabi, at the end of October. The description of the game would not be discussed at this point as “there is fierce competition,” says Feghali. He expects the launch of the first consumer mobile game to allow Wixel to generate $300,000 in revenues this year. “We intend to be the company leading mobile games in region," adds Feghali.

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Maya Sioufi

Maya is a research consultant on Arab youth entrepreneurship and employment. She headed Executive's banking, finance and entrepreneurship sections from 2011 to 2013. Previously, she worked at JP Morgan in London in equity sales for three years. She holds an MSc in Accounting and Finance from the London School of Economics (LSE) and a BA in Economics from the American University of Beirut (AUB).   

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