“We lost 80 percent of our revenue in one night,” says Ronaldo Mouchawar, CEO and founder of e-commerce platform Souq.
Mouchawar is referring to the moment in 2011 when his company changed its initial auction model to a straight online shopping site. Thankfully, the move has long since proved to be the right one.
Less than a decade later, Souq.com is the Middle East’s largest e-commerce website, attracting over 45 million visitors per month with 9.4 million products available for sale.
In 2017, it was acquired by global e-commerce and logistics giant Amazon for $580m, the second company after Maktoob (now Yahoo Maktoob) he had managed to help develop and then sell to a US internet powerhouse.
And much like Amazon’s Jeff Bezos, Mouchawar has become a legend in the Middle East’s business community, credited with changing the face of regional retail. Candid, clever and a little reclusive, he is also similarly hard to catch – and even harder to keep up with.
Arabian Business meets him just as he is due to address a crowd of emerging business owners, eager to grasp whatever tricks of the trade he is willing to share.
As we find out over the course of our conversation, however, there is no secret to Souq’s success besides the old-fashioned principle of trial and error. But Syrian-born Mouchawar has good news for start-ups: it is getting easier.
“When I started Souq, there was not a single person in the Middle East willing to invest in us. It was really hard to get seed funding,” he says.
“We had to go abroad to raise capital. There was a whole year that I must have spent on a plane trying to get our funding round. The ecosystem has changed a lot, especially in the last two years.”
The success of start-ups such as Souq has been one of the main drivers in creating an environment attractive to regional investors, while the rise of mobile technology has helped uplift many small businesses.
According to Mouchawar, it is now easier to create ideas and attract funding in the Middle East, while foreign investors are also more confident about entering the market.
Souq hosts 9.4 million products and records an average of 45 million visits per month
“We used to have to introduce the region, before telling them about our business. Investors would say, ‘I’m not comfortable investing there. Is it safe? How is corruption?’ That used to take a long time to overcome.”
Thankfully, the increase in regional investors has removed those barriers. “The good thing about locals is that they know the environment, so we don’t have to explain the region. We can just tell them about our business,” he says.