Souq founder Ronaldo Mouchawar remains MENA’s online guru at Amazon

Ronaldo Mouchawar
Short Url
Updated 17 January 2022

Souq founder Ronaldo Mouchawar remains MENA’s online guru at Amazon

  • Souq now attracts more than 45 million customers per month and offers 9.5 million products on its platform

RIYADH: MENA’s first man of the internet Ronaldo Mouchawar may have sold the firm he set up for $580 million, but has the same drive he had when he joined his first startup 20 years ago.

The Syrian entrepreneur built the largest online marketplace in the region, Souq.com, in 2005 and 12 years later sold it to US tech giant Amazon.

But rather than sunning himself on the most exclusive beaches around the world, he stayed on to become vice president of Amazon MENA.

Souq now attracts more than 45 million customers per month and offers 9.5 million products on its platform, ranging from consumer electronics, household goods, fashion brands to baby products. It employs 4,500 staff.

Mouchawar’s career is closely linked with the development of the web in the region.

Born in Aleppo, Syria, to a family of traders and engineers, Mouchawar was a basketball star at local team Jalaa SC Aleppo, before heading to the US’ Northeastern University in Boston in the late 1980s to study a bachelor’s and later master’s degree in computer science.




Ronaldo Mouchawar

He remained in the US, working at information technology firm EDS, founded by billionaire Ross Perot, who unsuccessfully ran for the US presidency in 1992. Mouchawar was kept busy at the business dealing in the emerging field of image processing and video scanning for car manufacturers, healthcare organizations and publishing companies.

As the web grew rapidly in the US in the early 2000s, Mouchawar returned to the Middle East, where digital firms were an emerging venture.

He joined Jordan-based Maktoob.com, whose founders Samih Toukan and Hussam Khoury pioneered online services in the Middle East. At that time, little on the internet was in Arabic.

“Samih and Hussam built the first Arabic version of email,” Mouchawar told Arab News. “And many Arabic speakers across the world started using this tool because it enabled you to write in Arabic regardless of where you were and what operating system you were using. Maktoob also provided an Arabic language chat room and instant messaging.

“We immediately saw traction with young people. It was all about self-expression, because we did not produce our own content — it was entirely user-generated.

“We would get energizing emails from customers who were using our platform to communicate, post blogs and create forums.”

But while Maktoob was growing in popularity, its revenue was low. “We wanted to monetize our portals as the traffic grew,” Mouchawar said.

“And we thought that building an e-commerce section would make a lot of sense.”

Mouchawar led the effort to create Maktoob’s online shopping platform, offering an auction system modeled on eBay.

This prototype online market faced commercial challenges at the outset because, as Mouchawar, 52, said: “Our business model was driven by online advertising, and at that time almost all of a firm’s media spend was on traditional outlets — TV, outdoor, print, newspapers, flyers and so on. Digital was still a very small segment.

“But the fun part was that every month, we felt we were better than the month before. Even though not everything made a lot of sense to us. We were always wondering: ‘How can we get people to trade safely? How can we get people to trust us? How can we get merchants to sell and can we get customers to buy?’

“It was a bit of chaos theory at work, in terms of learning, trying many new things and building trust.”

But their work paid off and Maktoob was established as a key e-commerce site in the Gulf.

Mouchawar’s influence within the firm grew but he remained an employee, although he had ambitions to be his own boss.

With investment from Toukan, Mouchawar co-founded the Souq.com marketplace (souq means market in Arabic), which was founded in Dubai in 2005. Toukan became the other co-founder of the business.

“We were incubated in a way within the Maktoob ecosystem,” Mouchawar said.

He added: “With Maktoob, we were trying to cover the entire region. The mission of Souq was to use technology to break barriers and borders, and enable trade, but focused on only three countries — the UAE, Saudi Arabia and Egypt.”

Souq concentrated on business-to-customer and peer-to-peer selling, where ordinary users sell among themselves.

There was an influx of funds in 2009 when Maktoob was bought by Yahoo for $164 million. Toukan was a key shareholder but Mouchawar also benefited from stock options he held.

Mouchawar said: “At that point, we took a hard look at the customer journey. We decided to become an entirely business-to-customer site, and shut down some of the early community tools.

“And that was the pivot point, where we moved from a kind of community environment to more what looked like an Amazon offering.”

Souq achieved growth in three ways. Its sales numbers lifted, it bought rivals, and launched other related logistics and online payment startups. The entrepreneur said that the moves proved to be a virtuous circle, as these areas supported one another.

Mouchawar also brought in global talent, hiring senior staff from US multinationals such as Proctor & Gamble, Gillette and major international banks.

This led to Souq’s first venture capital investment round in 2012, with $40 million in equity funding led by US investment firm Tiger Global Management and South African fund Naspers.

“That investment took us to another level in terms of being able to focus on service and delivery,” said Mouchawar. “Over the next four years, we went from $60 million to $400 million turnover. It was insane growth. And we were bringing in new people — college graduates who within two or three years were managing teams of 40 people. That was life-changing for them.

“And we were serving our customers better, shortening delivery times and improving our payment proposition. We held our first White Friday (a regional version of US-inspired Black Friday sales held in late November) in 2014 for the first time, with big brands involved.”

Advisers tempted Mouchwar to expand into many different countries, but he was intent on growing the business within its existing territories.

“I say this to many entrepreneurs — sometimes by doing less, you do more. There are many bright people with good ideas, but you need to stand for something —and we wanted to stand for business-to-consumer e-commerce in this specific part of the world. We wanted to facilitate trade, gain trust and help entrepreneurs build businesses online.”

Another key funding round came in 2016, when Souq raised $270 million of investment led by Standard Chartered Bank and venture capital group International Finance Corporation.

“This was a large round. That’s when we surfaced on the global map,” said Mouchawar.

The company raised a total of $425 million across several rounds of funding by 2017, according to tech data website CrunchBase.

By now, Mouchawar added that Souq’s early investors were hungry for returns, and with interest from the world’s biggest tech firms, the chance of an acquisition grew.

Dubai real estate company Emaar had sought to buy the online business.

But a team from Amazon, lead by CEO Jeff Bezos, flew in to meet Souq’s top executives and toured the region, leaving impressed by what they saw.

A takeover of Souq by Amazon made sense for both sides, said Mouchawar. For Souq, the US giant would deliver a new level of infrastructure. For Amazon, Souq represented access to one of the world’s fastest-growing online marketplaces.

“I thought that with Amazon, we could build a large business with exciting innovations in a region with high mobile adoption, a young user base and a huge opportunity for commerce, cloud content and devices. Also, with more than 420 million Arabic-speaking people in the world, there are still many services that we could develop for them.”

The deal was signed in March 2017 when Amazon paid Souq for $580 million for the business.

However, Mouchawar felt compelled to stay on and accepted the position of vice president at Amazon MENA.

“Like some other colleagues at Souq, I didn’t feel the mission was done,” he said. “There was still a lot to do. I was excited to learn a lot more about Amazon and how things operate at that scale. We could employ more people, empower more people and build more talent.”

Sales at Amazon lifted 38 percent to $386 billion as net income jumped 84 percent to $21.3 billion last year, as consumers in lockdowns around the world ordered from the platform. The tech giant’s international sales, which includes Souq, surged by 40 percent over the same period.

Mouchawar said: “Since then, we’ve launched Amazon in Arabic in the UAE, Saudi Arabia and Egypt. And the December release of our virtual assistant Alexa in numerous regional dialects of Arabic was another key moment.”

Mouchawar seems comfortable working as the tech giant’s main man in the region.

He said: “For me, it’s always about working with smart, bright people, both locally and globally. As long as I’m learning how to bring new things to the region, I still feel excited about the role I play.”

Related


World Economic Forum to return in-person as it aims to shed light on ‘History at a Turning Point’

Updated 18 May 2022

World Economic Forum to return in-person as it aims to shed light on ‘History at a Turning Point’

  • This year’s meeting will bring together about 2,500 leaders and experts from around the world, including more than 50 heads of state and government, more than 1,250 leaders from the private sector and nearly 100 Global Innovators and Technology Pioneers

LONDON: The World Economic Forum announced on Wednesday that the theme of its annual meeting for 2022 will be ‘History at a Turning Point: Government Policies and Business Strategies’ in its return to an in-person conference since the pandemic forced it to go virtual since 2020.

“The Annual Meeting is the first summit that brings global leaders together in this new situation characterized by an emerging multipolar world as a result of the pandemic and war,” said Klaus Schwab, the WEF’s founder and executive chairman.

This year’s meeting — which is happening in the spring rather than its usual January slot — returns after a two-year hiatus and will bring together about 2,500 leaders and experts from around the world, including more than 50 heads of state and government, more than 1,250 leaders from the private sector and nearly 100 Global Innovators and Technology Pioneers.

“The fact that nearly 2,500 leaders from politics, business, civil society and media come together in person demonstrates the need for a trusted, informal and action-oriented global platform to confront the issues in a crisis-driven world,” Schwab said.

Civil society will be represented by more than 200 leaders from NGOs, social entrepreneurs, academia, labour organizations, faith-based and religious groups, and at least 400 media leaders and reporting press. The Annual Meeting will also bring together younger generations, with 100 members of the Forum’s Global Shaper and Young Global Leader communities participating.

Against a backdrop of the global pandemic, the Russian invasion of Ukraine and geo-economic challenges, the meeting convenes at a strategic point where public figures and global leaders will meet in person to reconnect, exchange insights, gain fresh perspectives and advance solutions.

Topics that will be discussed at the annual meeting range from COVID-19 and climate change to education, technology and energy governance.

These include the Reskilling Revolution, an initiative to provide 1 billion people with better education, skills and jobs by 2030; an initiative on universal environmental, social and governance (ESG) metrics and disclosures to measure stakeholder capitalism; and the One Trillion Trees initiative, 1t.org, to protect our trees and forests and restore the planet’s ecosystems.

The programme will have six thematic pillars, including fostering global and regional cooperation; securing the economic recovery and shaping a new era of growth; building healthy and equitable societies; safeguarding climate, food and nature; driving industry transformation, and finally; harnessing the power of the Fourth Industrial Revolution.


Bank of England official warns of tough times for crypto

Updated 17 May 2022

Bank of England official warns of tough times for crypto

  • G7 to discuss crypto-asset regulation, says French central banker

RIYADH: Investors in crypto currencies should expect more difficult times ahead as tightening financial conditions around the world stoke appetite for safer assets, Bank of England Deputy Gov. Jon Cunliffe said on Tuesday.

Asked at a Wall Street Journal conference if rising interest rates would ramp up pressure on crypto currencies, Cunliffe said: “Yes, I think as this process continues, as (quantitative tightening) starts in the US ... I think we’ll see a move out of risky assets.” Cunliffe added that the conflict in Ukraine also had the potential to cause a renewed flight to safer assets.

Bitcoin, the world’s largest cryptocurrency, fell as low as $25,401 on Thursday, its lowest since Dec. 2020. It hit a record high of $69,000 in November. 

However, it traded higher on Tuesday, up 0.2 percent to $30,418 as of 08:52 a.m. Riyadh time.

Ether, the second most traded cryptocurrency, was priced at $2,077, up 0.32 percent, according to data from CoinDesk.

G7 meeting

The regulation of crypto-assets is likely to be discussed at a meeting of Group of Seven finance chiefs this week in Germany, French central bank head Francois Villeroy de Galhau said on Tuesday.

“What happened in the recent past is a wake-up call for the urgent need for global regulation,” Villeroy told an emerging markets conference in Paris, referring to recent turbulence in crypto-asset markets.

“Europe paved the way with MICA (regulatory framework for crypto-assets), we will probably ... discuss these issues among many others at the G7 meeting in Germany this week,” he added.

Grayscale to launch digital assets

Grayscale will list an exchange-traded fund in Europe made up of companies representing the “Future of Finance,” the world’s largest cryptocurrency asset manager said in a statement on Monday. 

The ETF, tracking the “Bloomberg Grayscale Future of Finance Index,” will be listed on the London Stock Exchange, Italy’s Borsa Italiana and Germany’s Deutsche Börse Xetra and begin trading on May 17. It is the first time that US-based Grayscale has listed a fund in Europe.

The index contains a mixture of companies involved in digital currencies including asset managers, exchanges, brokers, technology firms, as well as firms directly involved in cryptocurrency mining. “For us, the digital economy is primarily being driven through the proliferation of digital assets,” said Grayscale CEO Michael Sonnenshein.

Related


NEOM ‘fully under Saudi sovereignty, regulations,’ says government official refuting inaccurate media reports

Updated 16 May 2022

NEOM ‘fully under Saudi sovereignty, regulations,’ says government official refuting inaccurate media reports

RIYADH: NEOM, a project fully owned by Saudi Public Investment Fund, is “completely under Saudi Arabia’s sovereignty and regulations,” the Saudi Press Agency reported early Monday, citing an official source.

The clarification came after NEOM's tourism sector head Andrew McEvoy made comments to media during his participation at Arabian Travel Market in Dubai about demographic status within the megacity, suggesting that residents within NEOM will have a special status, distinguishing them from others.


Read More: NEOM seeks to regenerate the area, offer ‘guilt-free’ vacations


NEOM City will have some special regulations related to investment reflecting its strategy as part of the Kingdom's Vision 2030, to make 'the city of the future' an effective driver in supporting the Saudi economy and the prosperity of the region, according to the company.

Economic legislation specific to the project area will be developed to achieve the best concepts of governance of economic zones in the world, making NEOM one of the most important attractions globally, SPA quoted the source as saying.

The point was underlined by Manar Al-Munif, chief investment officer of NEOM, while speaking at the Saudi-Thai Economic Forum in Riyadh on May 16.

She said the $500-billion future city will have its own regulations based on best practices from around the world that will allow businesses to grow and develop.

Al-Munif revealed that NEOM is the largest Environmental, Social, and Governance initiative in the world, and added that the project will create several investment opportunities for businesses. 

“We have identified a number of investment opportunities across 16 sectors in NEOM. These sectors represent the future, and we have outlined 150 investment initiatives. Each of these initiatives is going to have hundreds of opportunities regardless if it is a direct investment, joint venture, or merging,” Al-Munif added. 

She also said the NEOM project is trying to reinvent and introduce environmental factors, thus ensuring harmony with nature. 


Top CEO Conference and Awards to recognize industry leaders in GCC

Updated 15 May 2022

Top CEO Conference and Awards to recognize industry leaders in GCC

  • Publicly listed firms in GCC bourses are evaluation on their annual financial performance

DUBAI: Braving the setbacks they had faced during the pandemic, head honchos of top companies will be attending the Top CEO Conference and Awards to be held in the city from May 17-18 to celebrate leadership in the Gulf Cooperation Council.

According to the organizer’s statement, the Top CEO Awards are based on the financial performance, size and corporate governance of GCC-listed companies.

Julien Hawari, organizer of the TOP CEO, Special Edition, said in the statement: “All of the publicly listed companies in the Arabian Gulf stock markets are evaluated on their annual financial performance, and the ranking is not a result of a nomination by a jury relying on undisclosed metrics.”

The statement added that companies are evaluated if they are listed on any of the seven GCC stock markets. Moreover, Hawkamah Institute has provided corporate governance guidelines developed by the Top CEO in partnership with INSEAD Business School.

One of the Big Four has audited the results, and KPMG is auditing the Top CEO ranking for the 2022 awards, the statement said, while adding that Arab News and Al Arabiya News channel were chosen as media partners of the event.

According to Hawari, the awards were created in 2012 to recognize those who created value and boosted the region’s economy while maintaining transparency and good corporate governance.

FASTFACT

One of the Big Four has audited the results, and KPMG is auditing the Top CEO ranking for the 2022 awards.

The statement added that there are 10 categories of companies to be divided into, and the Top 10 CEOs in each category are recognized, totaling 100 awards.

The 10 categories are banking, energy and utility, financial services and investment, insurance, logistics and industrials, malls, real estate and construction, mining, metals and chemicals, retail, FMCG and consumer care, Shariah-compliant banks and financial services and telecom, tech and media.

Commenting on the event, Hawari said: “Global market forces are coming together in the post-pandemic economies to rebuild communities and businesses, and our region is no different.”

Compared to the pause of business in 2020 and slow growth in 2021, the first three months of 2022 saw Arabian Gulf stock markets increase by the most since the global financial meltdown.


Pakistan’s oil, food bill swells to $24.8 billion amid rising commodity prices, rupee depreciation

Updated 15 May 2022

Pakistan’s oil, food bill swells to $24.8 billion amid rising commodity prices, rupee depreciation

  • Petroleum products make up for 26% of Pakistan's overall imports worth $65.53 billion
  • Finance minister says he will talk to the IMF but refuses to withdraw energy subsidies

KARACHI: Pakistan’s oil and food import bills have swelled to $24.8 billion during the current fiscal year due to increasing global commodity prices and weakening national currency, according to official data and analysts. 

The oil and food import bills of the South Asian country, which is struggling with a worsening balance-of-payment crisis in the face of declining foreign exchange reserves, rose by 96 percent and 12.3 percent respectively from July 2021 till April 2022. 

Pakistan imported oil products worth $17.03 billion during this period, compared to imports worth $8.69 billion during the corresponding period last year. It contributed 26 percent to the country’s overall $65.53 billion imports, according to the Pakistan Bureau of Statistics (PBS). 

The food import bill during the period stood at $7.75 billion against the $6.9 billion recorded during the same period last year. The import of palm oil worth over $3 billion alone made up for a major share of the import bill, which surged by 44 percent from July till April. 

“The surging global commodity prices are a major reason behind high oil and food prices, mainly due to the Russia-Ukraine war and revival of COVID-19 that have disrupted the supply and demand balance,” Ahsan Mehanti, chief executive officer of the Arif Habib Commodities investment firm, told Arab News on Sunday. 

“Inflation triggered by the import of energy and food items at higher prices will continue to persist as long as the rupee does not recover.” 

The Pakistani currency continues to hit new lows against the United States (US) dollar as the demand for import payments continues to build pressure on the rupee. On Friday, the rupee hit yet another historic low as the greenback closed at Rs192.53 in the interbank market.    

The US dollar has gained 6 percent or Rs10.98 against the rupee since April 16, when it was trading at Rs181.55.  

Experts believe the Pakistani currency will recoup some of the lost ground after Islamabad and the International Monetary Fund (IMF) sign a deal for the revival of $6 billion loan program. 

“We see the dollar hitting Rs200 mark against the rupee before falling back to around Rs180,” Mehanti said. "We expect the rupee to recover after Pakistan signs a deal with the IMF next week." 

Pakistan and the IMF are currently negotiating the country's seventh review under the $6 billion Extended Fund Facility (EFF), which has so far disbursed $3 billion. Islamabad is expected to receive another $1 billion after the completion of the review.    

The review has been stalled since the previous government announced in February around $1.7 billion relief in energy prices while deviating from the objectives of the IMF program.  

“I am going to talk to the IMF and will find out the solution to the issue amicably,” Miftah Ismail, the Pakistani finance minister, said at a press conference in Islamabad on Sunday. 

“The government has no intention to further increase the petroleum prices. The prime minister has refused to burden the people further.” 

Pakistan’s imports of machinery also posted an increase by 20.5 percent to $9.5 billion from July till April as compared to $7.9 billion during the same period last year. Imports of telecom equipment jumped by 14 percent to $2.4 billion, while mobile phone imports rose by 7.4 percent to $1.8 billion.   

The South Asian nation imported vehicles worth $3.7 billion, which shows over 60 percent growth in 10 months of the current fiscal year.   

Pakistan suffered $39.3 billion trade deficit from July till April due to the highest ever imports of $65.53 billion. Experts call for addressing the situation by restricting the import of non-essential and luxurious goods.