Tips to start your own business
Want to start your own business? You’re in luck: the UAE is reportedly the 24th best place in the world for entrepreneurs. Kipp gets six tips for before you start.
November 14, 2010 1:10 by Eva Fernandes
Microsoft, Google, Skype: besides being insanely popular in the world of technology, these companies have another thing in common – they are all business ideas that developed out a recession. To borrow the old cliché, necessity was indeed the mother of invention.
While some say the UAE economy is slowly recovering and others fear double dipping, there is no doubt that the world of entrepreneurship is booming in the UAE. The 2010 Legatum Prosperity Report ranked the UAE as the 24th best place in the world for entrepreneurs. Why? A combination of healthy, adventurous attitudes towards business, low starts up costs, and developed infrastructure. The survey also found that 95 percent of people in the UAE believe the country is a meritocracy and that hard work will pay off.
At the recently held Celebration of Entrepreneurship, Kipp spoke to Edward Roderick, the co-chairman of Envestors MENA, a relatively young UAE consultancy that engages a network of private individuals looking to invest up to $4 million in early-stage businesses. Kipp is an ambitious sort of website, so we asked Roderick to give us his top six tips for starting up a business in the UAE. And here they are (thank us when you’re rich):
1. Licenses: Establish what licenses you will need to start your business here. The current trend is to opt for operating in a free-zone area, so that you can maintain 100 percent ownership of the company as an individual; rather than having to share with an Emirati. Free-zones also tend to be a lot more cost-effective.
2. Money, money, money: Make sure you have enough money to cover all the costs involved, because often you will be required to pay for property up front. There are also licensing charges, visa costs, legal charges and accounting charges. Starting up in the UAE can cost anything between $20-70 thousand depending on the size and scale of the business. If you are at the beginning of the process and all you have is a really great idea, the best way to get start up money is to call up your mum and dad. First start off with your friends, family, and then you move to angel investors, then to venture capital investing and then public investing.
3. Understanding local markets: Better understand the market you operate in. Before you begin, you should be sure you have a good understanding of the nature of demand within the current market and the services that are available, because you are going to need to hit the ground relatively quickly in order to be able to absorb all the initial start-up costs.
4. Invest in good quality of staff: At the current time, because of the recession, there is a considerable availability of good quality staff looking for opportunities at a relatively low cost (compared to before the recession). Particularly because the cost of property is growing lower for people, reducing the general cost of living.
5. Focus on suppliers: The biggest problem for people in this region is getting your bills paid. If you aren’t a consumer business and you are working in a B2B environment then the debtor days are extraordinarily long and can have a significant impact on the business. So focus on the quality of the contractor that you sign with, and pay attention to the contracts – it is a worthy investment of your time.
6. Publicity: Get out and let the world know what you are doing. PR advertising, not always paid for, will get you a long way. Of course, networking, going to business groups and business conferences will help too. Just go out if you can and volunteer to speak at events. And, in the modern day, what will really help get your name out there is a really great website.