Insight Category: Business

Disclaimer:

This is a long read, yet it only scratches the surface of entrepreneurship. We aim to concisely tell the story of our beginnings, the challenges we faced, and what we have learned along the way. We hope to inspire upcoming entrepreneurs and aspiring business owners to start their businesses while knowing some of the challenges they might face.

Introduction
Rouya is truly a wondrous thing. It is the amalgamation of multiple strong energy waves produced from metals pressed over numerous decades. Each one of those metals brings something different to the table.

Of course, it is a business, after all. However, one must understand that businesses are strange—an illusion. The concept of a company was one of the greatest human inventions. An idea that turns into a series of thoughts, discussions, long-night meetings, vision, mission, and strategy. From there, business, marketing, financial, human capital, and legal plans spur like new seedlings. It is hard to remember that all this will be attributed to an imaginary thing; it does not exist, yet one hires a team to manage it, rents a space for it, calls it ‘our company’s office space,’ prints out a logo, and sticks it on the front door.

In that very instance where an individual or a group of people start a business, multiple other individuals and groups have done precisely the same thing. They went through a similar process that got them to the same place—at an office, but with a different logo stuck on the door.

One wonders why people start businesses. From the onset, the odds are stacked against new companies. According to the latest data, up to 90% of startups fail (Deane, 2024). Imagine starting the process that I outlined above and going through months or years of hard work to set up this imaginary brand, conjured up through legal documents called ‘memorandum of association’, ‘business licence’, ‘establishment card’, and ‘operation permit’, knowing that 90% of new businesses fail. To understand the statistics behind the percentages I shared above, here is a simple example:

Let’s say 1,000 newly minted companies received their “business licence” on January 1, 2015. According to the United States Bureau of Labor Statistics, approximately 20% of those 1,000 newly minted companies will fail within the first 24 months.

• Year 1 (2015): A total 100 companies would have closed, leaving 900 surviving.
• Year 2 (2016): A total 200 companies would have closed, leaving 800 surviving.
• Year 5 (2019): A total 500 companies would have closed, leaving 500 surviving.
• Year 10 (2024): A total 670 companies would have closed, leaving 330 surviving.
• Year 15 (2029): A total 900 companies would have closed, leaving only 100 surviving.

How delusional one must be to take that leap of faith and believe that she or he will be part of the 20% that do not fail.

This article shares how, in our tenth year, we retrospectively assess what we have done to elude the 67% that failed, the lessons we learned along the way, the wounds and scars we nurse, our principles for success, and our future ambitions.

Eluding The 67%

Eluding failure should not be an objective that is set either from the beginning or at any other point. Rather, it is the culmination of many forces consistently at play: industry-veteran founders, iron-clad determination to get into a new business, high professional and personal reputation, and most importantly, a willingness from everyone to stomp on their ego every day.

First Business Principle 

Start a business with an industry veteran

In a traditional business industry like ours, having industry veterans as founders is critical to the initial launch and continued success—the first business principle. Do the founders need to have business acumen from the get-go? Not necessarily. However, founders must learn about the fundamentals of business and how to run their business on the go. The Business Model Generation handbook by Alexander Osterwalder & Yves Pigneur (2010) played a fundamental role in our understanding of the essential building blocks of business thinking and development.

During the early stages of developing Ila Al Amam (2014 – 2017), founder Maryam Al Dabbagh and I organised workshops at our home and the residence of Zainab Al Dabbagh—Maryam’s cousin who later led our media relations services—to meticulously establish each element of the Business Model Canvas. Ila Al Amam was the precursor to Rouya and played a pivotal role in creating Arabic storytelling and content for organisations across the UAE and the Gulf region.

At this point, other business variables, such as pricing, information presentation, operation management ,and quality service delivery, came into play. Nevertheless, it was never perfect; even though you might attempt to be perfect in delivery, you’ll never achieve it. I say this with all confidence because five years later, when you look at your “perfect” work, at the very least, you will cringe.

Second Business Principle 

Businesses require relentless dedication

To put it lightly, we consumed our business, and our business consumed us. Ila Al Amam, renamed Rouya in 2017, became our everything; everyone was laser-focused on getting work done. We would work until burnout, rest for a few days (if lucky), and then return to it again. Let me put it this way: if we, the founders, weren’t sleeping, we would be ‘Rouya’ing’—the second business principle: the necessity of relentless dedication in the early stages of building a company.

Entrepreneurship demands a commitment that consumes nearly every aspect of your life, blurring the lines between personal and professional spheres. Success hinges on your ability to devote every available moment to the growth and stability of the business. It’s not merely about hard work; it’s about total immersion—every decision, action, and thought must align with propelling the business forward. Rest becomes a luxury; even when you step away, your mind remains tethered to the business.

Many, Many Brick Walls

Personal Cash Flow – Living Costs Higher than Income

When we started Ila Al Amam, our living costs were much higher than our business revenue. So, to survive, we had to make a drastic decision: move to an affordable city. Starting a business takes time. By nature, humans are risk-averse and new businesses shout ‘HIGH RISK’ to any manager looking to get the best results her or his money could buy (Blunk, 2024). This is where the first principle comes in handy. As a market veteran, a business can lean on its network for quality of work and execution track-record reputation for the initial business flow; however, if the business isn’t able to pay for one’s personal life, anxiety builds up, turning one’s focus away from the business to making a living.

High Demand – Low Capacity (Low Price, High Quality → Overbooked → Frustrated)

By early-2016, our business had been running for about 6 months, so we decided to expand into a new market: Public Relations Management. A world that I, for one, knew nothing about; however, Maryam had made her start in PR. Following the same first principle, start a business with an industry veteran, we spoke to Yusur Al Dabbagh (as you would have guessed, yes, Maryam’s sister) to join Ila Al Amam and start a public relations ‘department’. Although it was extremely challenging for her to leave the comfort of a steady government job to join what seemed like a tiny hobby-like business, Yusur took a ginormous leap of faith and joined as a third partner in Il Al Amam.

Third Business Principle

Set Yourself a Monthly Salary

At the beginning of the metamorphosis of Ila Al Amam into Rouya, my contribution was to develop proposals, accounting, and the back end of the sales journey (contracts, invoices, and receipts). From the beginning, we ensured that we took a fixed salary from the business and did not treat the business bank account as our current account. Our third business principle: set a salary for yourself and other partners. The salary should cover your basic monthly needs and not exceed 10% of the value you bring in as a partner to the company. This could be split into 5% or lower in terms of a monthly salary, and the rest is taken in the form of profits. You could also measure this in another form, if you were to hire someone to do the things that you are doing, how much would you have to pay them? This gives you an understanding of the average market salary. Now, In most starting and running private companies, salaries are typically much lower than standard government, semi-government, and public companies. Taking salaries should be the go-to tactic to ensure stability within the business cash flow, a structured business bank statement, and a seamless job for the auditors. For me, it meant getting a salary of AED 1,500/month as the co-founder working a part-time job.

For Maryam, things were different; more and more of her business network around her wanted to work with her. She delivered project after project until we realised Ila Al Amam was behind on its new requests and approved scopes of work. There simply weren’t enough hours in the day, and Maryam was the only person with the required skill set to execute those deliverables. When other partners tried to support us in delivering the tasks that only Maryam knew how to do very well, we would receive multiple client complaints. What ensued were many late nights, frustration with work, and burnout. 

Multiple business concepts come into play when founders need to assess whether their business is viable. What is the Cost of Goods Sold (COGS)? Hopefully, it’s lower than the price we were selling them for. For Ila Al Amam, the entirety of the business infrastructure was already available before we started our business; we used our home, our internet, and our personal computers, so time and effort were the only variables that went into the cost of delivering a page of developed content. There was a gross margin that we used to pay for our lives (in retrospect, we should have expensed our rent and other personal materials we used for business service delivery. However, it was a blessing that we didn’t, as that meant positive cash flow). Net profit wasn’t even on our radar, and given how lean our business structure was, we broke even six months into our business startup. 

We found out through managerial accounting that we could use two other business concepts to determine if one line of business is worth all the trouble: Contribution Margin and Opportunity Cost. At this point, we had two lines of business: content development and public relations. Content development requires a sophisticated combination of high language skills, cultural expertise, and high experience within the arts and culture scene. The problem was that clients were unwilling to pay a high premium for what they considered a simple job (it’s not–I’ve tried and failed miserably); however, they would only accept it if it was carried out by a highly experienced consultant (which had high costs and was time-consuming). Understanding the contribution margin and the opportunity cost of delivering the content development service forced us to look for a pricing model that allowed us to break free from the industry standards. 

Steering the Ship

Having read the paragraphs above, readers are correct to note that I worked in Rouya full-time. However, the reality of bootstrapping a startup with partners is that some partners will have to maintain side jobs that provide them with consistent monthly pay. Hence, from 2015 to May 2017, I was a CrossFit coach at FitRepublik (a legacy profession from my first business). 2017 is when I finally dedicated my full time to Rouya. At the time, Rouya was working with several small businesses in Sharjah. I jumped into projects, managed government relations, and developed proposals. Our biggest project then was managing communications for the government of Sharjah’s National Day celebrations by the end of 2017.

I was adamant about developing internal systems for project management, human resources, and proposal development. As early as 2015, Ila Al Amam was paperless; we developed all our work through cloud-based softwares that facilitated communication and collaboration.

But first, auditing! We transitioned from Ila Al Amam in Abu Dhabi to Rouya Consultancy in Sharjah. Over 18 months, we accumulated bank statements, receipts, and invoices, and moved them from a rigid accounting system into a user-friendly software. We also created foundational accounting work like developing our chart of accounts, HR standard operating procedure (SOP), and a filing system that allowed us to find documents when needed without asking several people to remember where they were filed.

One thing led to another, and I found myself managing our highest monthly retainer project in the short history of our company. The project was not even within the communications industry, it was with the e-commerce industry. This project led me to the realisation that I needed to upgrade my game. Enter my long-time business idol Jack Welch (RIP). Hello Jack!

Note: My MBA from Jack Welch Management Institute ranked among the top 10 global online MBAs for many consecutive years. It took me three years to complete, and I’m happy to report that I graduated as a Welch Scholar. 

What I Learned from My Jack Welch MBA and How My Education Influenced Rouya

Key Learnings from the MBA Program

One of the most impactful lessons I learned from my Jack Welch MBA program was understanding my conflict management personality. This self-awareness was crucial in shaping my approach to handling conflicts within the team. The program also introduced me to some seminal works and concepts that profoundly influenced my thinking:

• The Five Dysfunctions of a Team by Patrick Lencioni taught me the importance of addressing and managing team dysfunctions to
• build a cohesive and effective team.
• The Well-Timed Management Strategies by Peter Navarro provided strategies such as protecting high-skilled workers during recessions and increasing capital expenditures during downturns to prepare for economic recovery.
• Laszlo Bock highlighted the “Wisdom of the Crowd” concept, which emphasises the value of collective intelligence and diverse perspectives in decision-making.
• Culture and Performance Management, as Jack Welch practised, highlighted the significance of fostering a robust and performance-oriented company culture.
• Developing a five-page strategy using five simple questions streamlined our strategic planning process, making it more focused and actionable.

How These Lessons Changed My Approach to Business Management and Strategy:

Firstly, I realised there is no magic formula for managing a business. Publications and authors often suggest that becoming a CEO is reserved for an elite few, but that’s not true. Managing a company effectively involves gaining work experience, continuously applying oneself, and maintaining a passion for business, its industry, and the possibilities for the future. Furthermore, there are many business strategies, frameworks, tools, formulas, and models that CEOs and their executive teams use at larger corporations. It is challenging to try to apply that basket within a small business, but as long as leaders engage in continuous learning and development and listen to the people around them, they can become great leaders.

As many MBA students can confirm, we spend 18 to 24 months exploring key concepts within many industries, ranging from leadership and executive presence to marketing, supply chain and operations, information technology, and entrepreneurship. 

Some of these critical concepts immediately impacted our micro company. One critical aspect was raising constructive conflict by voicing opinions and applying intuition to situations at work. Keeping concerns pent up and discussing them only behind the scenes as a manager creates a toxic environment. Honesty and candour in giving feedback are essential for maintaining a healthy and productive work culture. Expecting the highest quality from the team, showing them the ropes, and being candid with feedback fosters a culture of excellence.

Application of Learnings to Rouya

My experience with the MBA program significantly helped instill a culture of continuous learning. And just as Peter Navarro argued, well-timed strategies and tactics were pivotal for us. For instance, protecting a high-skilled workforce during recessions, cherry-picking talent from the pool, or increasing capital expenditures during recessions to develop innovative products and new capacities in time for recovery were key tactics that helped us grow our business by 500% on key metrics over the past four years.

Other learnings were applied in various ways at Rouya. For instance, we implemented strategies to manage conflicts constructively, which helped maintain a healthy team dynamic and fostered a culture of transparency and accountability.

A Decade Later, Where We Go from Here

Current Status of Rouya

Rouya is now positioned as a regional leader in strategic storytelling and communications in both Arabic and English. We have successfully delivered critical national and international projects in the UAE, Qatar, Saudi Arabia, and Japan. From starting in our living room and a team of two, Rouya now operates from a combined space of 3000 sq ft office (versus our 200 sq ft we started with), employs over 25 brilliant full-time team members*, collaborates with several highly-qualified contractors, and leverages state-of-the-art hardware and software. We have fully deployed project management solutions, ensuring 100% employee utilisation since 2019.

Recently, we launched new digital communication services, a new website, a blog, and a developing podcast, among other exciting products and services. In 2024, we also launched our research department, successfully executing multiple quantitative and qualitative research sprints for our clients.

Future Goals and Vision

Rouya’s vision is to direct and own our story. Our mission is to embody ihsan in everything that we do with a purpose of unearthing inherited practices to understand, communicate and advance national narratives. We strive to facilitate an environment that permits the best people to do their best work through human-centric work policies, competitive pay, and exciting and impactful project opportunities.

Advice for Upcoming Entrepreneurs

Based on our journey, I advise aspiring entrepreneurs to stay passionate and committed to continuous learning and development. Focus from the outset on building a solid team, foster a transparent and collaborative culture, and be comfortable with raising constructive conflict. Understand that there is no magic formula to success; it’s about gaining experience, applying oneself, and continuously adapting to changing circumstances. With resilience, division of labor, and keeping one’s ego at bay, you can navigate the mighty obstacles you will face, and drive meaningful progress toward your business objectives. 

Furthermore, what makes the biggest difference to how long you can survive as a business is how lean you are. Keep your expenses as low as possible. For example, rather than hiring an accountant, outsource to a credible accounting firm; rather than buying new office furniture, find used furniture. Only make expensive decisions if they have business returns. Moreover, be lean with your time; if you can work from home, then do that, or rent an office close by. 

Lastly, mistakes are a critical component of entrepreneurship. Design around experimentation, trial and error, and not being perfect. Entrepreneurship is in and of itself a learning and development journey. If you fall in the 67% the first time, you’re more likely to elude it the second time, or the third or fourth. If you don’t give up, the market will reward you with success. You will eventually make it! 

References:

• Deane, M. T. (2024). Top 6 Reasons New Businesses Fail. Investopedia Online Article. Link
• Osterwalder, A., & Pigneur, Y. (2010). Business Model Generation. John Wiley & Sons.
• Blunk, A. Concepts & Biases: Risk Aversion – Everything You Need To Know. Published on Inside BE. Link
• Lencioni, P. (2002). The Five Dysfunctions of a Team: A Leadership Fable. Jossey-Bass.
• Navarro, P. (2009). The Well-Timed Strategy: Managing the Business Cycle for Competitive Advantage. Pearson Education.
• Bock, L. (2015). Work Rules!: Insights from Inside Google That Will Transform How You Live and Lead. Twelve.
• Welch, J., & Welch, S. (2005). Winning. Harper Business.

*At the time of publishing