SPECIAL REPORT: THE LATEST HEALTHCARE TRENDS SHOWCASED
SCAN TO STEP INTO THE WORLD OF EVERDOME AND METAHERO WITH A SPECIAL AUGMENTED REALITY EXPERIENCE
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ROB GRYN, CEO AND FOUNDER OF EVERDOME AND METAHERO, TAKES US ON A JOURNEY THAT THE WORLD – OR AT LEAST THE VIRTUAL ONE – HASN’T SEEN YET
P.40 BEHIND THE SCENES: Exploring the issue of celebrity NFT endorsements
P.60 TICK TALK: The latest luxury timepieces unveiled at Watches and Wonders 2022
Gulf Business
CONTENTS / MAY 2022
07
The brief An insight into the news and trends shaping the region with perceptive commentary and analysis
28 Cover Story: The transformation begins... Rob Gryn, CEO and founder of Everdome and Metahero, tells us why the metaverse is the next evolution of not only human communication, but of society as a whole
40 On the NFT bandwagon Celebrities can’t promote stocks, but can they endorse NFTs? We investigate
gulfbusiness.com
May 2022
3
Exclusive paintings, sculptures, photography and timepieces from award-winning international artists.
Painting by Ali Kashwani
Photograph by Anthony Lamb
The United Arab Emirates 50th Anniversary Clock Limited Edition by David Galbraith
CONTENTS / MAY 2022
59 Lifestyle
Time’s right: New watches unveiled at Watches and Wonders 2022 p.60
Great heights: In conversation with Nemo Stojanovic from Central Park Towers, DIFC p.65
Scent of success: Showcasing the journey of Cartier’s fragrance business p.66
“I hope that even my worst critics remain on Twitter, because that is what free speech means” Elon Musk, CEO of Tesla and SpaceX
69 The SME Story Interviews with entrepreneurs and insights from experts on how the regional SME ecosytem is evolving
Editor-in-chief Obaid Humaid Al Tayer Managing partner and group editor Ian Fairservice Group director Andrew Wingrove andrew.wingrove@motivate.ae Editor Neesha Salian neesha.salian@motivate.ae Deputy editor Varun Godinho varun.godinho@motivate.ae varungodinho Tech editor Divsha Bhat divsha.bhat@motivate.ae Contributor Zainab Mansoor editorial.freelancer@motivate.ae zzainabmansoor Senior art director Olga Petroff olga.petroff@motivate.ae Art director Freddie N. Colinares freddie@motivate.ae Photographer Mark Mathew
General manager – production S Sunil Kumar Assistant production manager Binu Purandaran Production supervisor Venita Pinto Chief commercial officer Anthony Milne anthony@motivate.ae Group sales manager Manish Chopra manish.chopra@motivate.ae Sales executive Sonal Sawant sonal.sawant@motivate.ae Sales executive Sonam Sharma sonam.sharma@motivate.ae Group marketing manager Joelle AlBeaino joelle.albeaino@motivate.ae Group marketing manager Dominic Clerici dominic.clerici@motivate.ae
Cover: Freddie N. Colinares Follow us on social media: Linkedin: Gulf Business Facebook: GulfBusiness Twitter: @GulfBusiness Instagram: @GulfBusiness
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May 2022
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UAE Yearly Funding Evolution
The Brief Climate action Digital payments Finance Productivity Crisis management
08 10 14 15 16
MAY
22
After seeing three consecutive quarter-on-quarter growth in funding, the UAE-based VC ecosystem explores new heights in the first quarter of 2022 ($) #OF DEALS Mega ($100M+) Funding Amount Undisclosed Proxy $ Undisclosed Funding $
2018
2019
2020
2021
2022 YTD
Source: UAE Q1 2022 Venture Investment Report
Digital minimalism Reducing your digital footprint can improve focus, attention and productivity p.15 gulfbusiness.com
May 2022
7
The Brief / Climate Action
ILLUSTRATION: GETTY IMAGES/ALASHI
A N A LY S I S
Planet in peril The planet’s warming is likely to pass 1.5°C, UN scientists warn
T
he international goal to limit global heating to 1.5° Celsius is officially on life support. A United Nations-backed panel of climate scientists warned in a new report that the world may be on track to warm by more than 3°C – twice the Paris Agreement target – in a change that would painfully remake societies and life on the planet. The latest report from the Intergovernmental Panel on Climate Change (IPCC) comes after years of net-zero pledges by national governments, cities, businesses and investors, and it sounds a stark warning on the still-unchecked emissions of greenhouse gas pushing emissions to record levels. The focus of this report, the third released since August 2021, is on humanity’s vast arsenal of technology, know-how and wealth that remain insufficiently deployed in efforts to ensure a livable climate in the future. 8
May 2022
SOLAR AND WIND COSTS FELL
85% & 55%
BETWEEN 2010 AND 2019
The time to limit warming is perilously short. Greenhouse gas pollution must peak “at the latest before 2025” to keep targets alive, the IPCC scientists write. Based on national pledges made before last November’s Glasgow climate negotiations, emissions in 2030 “would make it likely that warming will exceed 1.5°C during the 21st century,” the authors conclude. That puts the loss of the first goal of the Paris Agreement within the lifetimes of many people now alive. “This is not fiction or exaggeration,” said UN Secretary General Antonio Guterres in a statement. “It is what science tells us will result from our current energy policies.” As bad as that sounds, scientists in recent years have reduced the likelihood of much higher increases, and the report makes clear that solutions are available or foreseeable in virtually every sector. There are cost-effective carbon-cutting opportunities that together could meet half the 2030 emissions target. Global GDP would be “a few percent lower” in 2050 than on the current trajectory, not accounting for the benefits of climate damage avoided. At least 18 countries have proven that it’s possible to reduce greenhouse-gas emissions for a decade running – in some cases up to 4 per cent a year and potentially in line with a 2°C temperature rise. Solar and wind costs fell 85 per cent and 55 per cent between 2010 and 2019, making them now cheaper than fossil-fuel-powered electricity generation in many places. Carbon-free and low carbon technologies, including nuclear and hydroelectric power, made up 37 per cent of the electricity generated globally in 2019. Transportation, which caused 23 per cent of CO2 emissions from energy in 2019 (16 per cent from road vehicles alone) is poised for change, with battery prices dropping 85 per cent in the last decade. Low-emitting alternatives to the production of industrial materials are only in pilot or early-commercial stages. The report heralds “digitalisation” – robotics, AI, the internet of things – as a powerful way to increase energy efficiency and manage renewable power. The report’s parade of numbers shows just how far away countries are from adequately addressing climate change. Greenhouse-gas emissions in 2019 peaked at a new high of 59 billion metric tons. Carbon emissions from 2010 to 2019 are equivalent to about 80 per cent of all the remaining room in the 1.5°C “carbon budget,” an accounting that scientists gulfbusiness.com
The Brief / Climate Action
use to estimate how much more pollution the atmosphere can stand without heating up past the Paris Agreement’s limits of 1.5°C or 2°C. The intensity of emissions, or the energy use per GDP, fell 2 per cent in the last decade, but that gain was overwhelmed by increased GHG pollution. Emissions from existing fossil-fuel infrastructure alone would push the climate beyond the Paris Agreement’s lower bar, compounding effects already plain with 1.1°C of warming above the pre-industrial average. Avoiding that fate, the scientists conclude, means stranding trillions of dollars in plans and infrastructure too dangerous to continue operating, unless technology emerges to capture and dispense with their emissions. A peak in global emissions before 2025 would require more upfront investment and a faster pace of change than a later peak “but bring long-term gains for the economy,” on top of the benefits of climate damage that was avoided, the authors wrote. As it stands, financing for strategies to prevent climate change must grow three to six times above its current level to keep the 1.5°C goal in play. Policy is not helping as much as it could. Only 53 per cent fall under climate laws, and just 20 per cent of emissions fall under carbon pricing regimes of some kind – approaches that “have been insufficient to achieve deep reductions,” the report states. In its landmark 2018 special report on 1.5°C of heating, the IPCC found that to have an even chance of staying below the target, the world needed to halve 2010 emission levels by 2030 and eliminate them by 2050. This prompted the “net-zero by 2050” pledges now common among governments, companies and investors. The new report updates those figures, saying that all greenhouse gasses, not just CO2, must fall 43 per cent below their 2019 levels by 2030 and 84 per cent by 2050. To meet the Paris Agreement’s higher limit of 2°C, all gases
IN THEIR TECHNICAL SUMMARY, SCIENTISTS CITE A STUDY ESTIMATING NEARLY
$12tn
IN STRANDED FOSSIL-FUEL ASSETS BY 2050
METHANE, THE SECOND MOSTINFLUENTIAL GAS AFTER CO2, HAS TO FALL SUBSTANTIALLY AND SOON. WHILE IT’S DIFFICULT TO ERADICATE FROM AGRICULTURE, RELATIVELY LOW-COST FIXES TO LEAKY FOSSIL-FUEL INFRASTRUCTURE — ITSELF 6 PER CENT OF GLOBAL EMISSIONS — COULD WIPE OUT A SUBSTANTIAL PORTION OF POLLUTION FROM THOSE SOURCES gulfbusiness.com
would have to be cut 27 per cent below 2019 levels by 2030 and 64 per cent by 2050. Methane, the second most-influential gas after CO2, has to fall substantially and soon. While it’s difficult to eradicate from agriculture, relatively lowcost fixes to leaky fossil-fuel infrastructure — itself 6 per cent of global emissions — could wipe out a substantial portion of pollution from those sources. The 1.5°C or even 2°C limits will be increasingly challenging without what scientists call “overshoot,” or surpassing the temperature limit and then clawing back down through a combination of forest regrowth and restoration, and emerging carbonremoval (CDR) technologies that are “unavoidable” for a path to net-zero. To fall back below the 1.5°C target by 2100, the IPCC wrote, practices and policies – many of them still embryonic – would have to draw down almost a decade of CO2 emissions, according to scenarios that “are subject to increased feasibility concerns,” they said. The report’s wording of fossil fuel use is in many places heavily caveated by language suggesting technologies that capture carbon dioxide pollution and store it underground, under the ocean or in manufactured goods could allow otherwise polluting infrastructure to continue to exist. Coal, oil and gas use without carbon capture and storage must fall 100 per cent, 60 per cent and 70 per cent below 2019 levels by 2050. “Depending on its availability, CCS could allow fossil fuels to be used for longer, reducing stranded assets” that could otherwise total up to $4tn in a 2°C scenario. In their technical summary, scientists cite a study estimating nearly $12tn in stranded fossil-fuel assets by 2050, with another decade of delayed mitigation adding almost $8tn. They write elsewhere that since their last report it’s become clear that “small-scale technologies (e.g., solar, batteries) tend to improve faster and be adopted more quickly than large-scale technologies,” such as nuclear power or CCS. The report is the third of four installments that make up the largely volunteer scientific group’s sixth global reckoning since 1990. Focused on prevention – or “mitigation” in the jargon – the report is the IPCC’s most elaborate description yet of how aggressive systemic change must be to transform how civilization powers, moves, feeds and houses itself. Falling demand — including technology and behavioural changes and cultural change — can cut all emissions in key sectors by 40 per cent to 70 per cent by 2050, compared with national policies and commitments made through 2020. These approaches “are consistent with improving basic wellbeing for all.” (Bloomberg) May 2022
9
The Brief / Digital Payments COMMENT
Nandan Mer, group CEO, Network International
Cashing in on cashless
Driven by increasing consumer demand and a greater understanding of the benefits of going digital, digital payment adoption in the UAE and Saudi Arabia is steadily rising opportunity that currently exists in the region, particularly when compared to the US or some European countries where digital payments participation is over 80 per cent. Indeed, Saudi Arabia’s leadership has recognised this untapped potential and has made the accelerated adoption of digital payments a key priority in the Saudi Arabia’s Vision 2030.
ILLUSTRATION: GETTY IMAGES/UNIQUEPIXEL
THE UAE LEADS THE REGION
N
o longer the domain of the tech savvy and financially literate, digital payments are permeating every facet of society, unlocking new opportunities for small- and medium-enterprises (SMEs) and entrepreneurs to expand their markets in previously unimaginable ways. Covid-19 has played a major role in accelerating the adoption of digital payments in the Middle East, as lockdowns and movement restrictions encouraged consumers to switch to cashless payment alternatives. Despite this, the level of adoption continues to vary across the region. For instance, in the UAE, digital payments accounted for approximately 23 per cent of total transactions in 2020, whilst in Saudi Arabia, the Gulf Cooperation Council’s (GCC) biggest economy and one of the most populous, digital payment participation was only 18 per cent. The discrepancy highlights the scale of 10
May 2022
E-COMMERCE
REPRESENTS A SIGNIFICANT AVENUE THROUGH WHICH THE ADOPTION OF DIGITAL PAYMENTS CAN EXPAND GROWTH OPPORTUNITIES AND UNLOCK NEW MARKETS FOR SMEs
Historically, the UAE has led the region in digital payments. With a supportive government and regulatory framework, the Dubai government has established a Cashless Dubai Working Group to create an action plan to shift all payment transactions in Dubai to secure and easy-touse cashless platforms across all sectors. More recently, Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, announced that the UAE Cabinet had adopted an agreement to link the payment systems of the GCC, a move that will further integrate the region and play a key role in expanding the already significant multilateral trade within the region. We ourselves have seen the tremendous rate of digital payment adoption across the UAE. According to consultants McKinsey & Co., the number of consumer digital payments transactions in the UAE grew at an annual rate of more than 9 per cent between 2014 and 2019, compared with Europe’s average annual growth of 4 per cent to 5 per cent. We have seen even faster growth, with a 44 per cent increase in digital payment volumes from SMEs during 2022. The positive impact of this adoption is clear. Digital payments have and continue to enhance efficiency across the public and private sector by providing the population easy access to reliable, safe and affordable payments systems that are convenient to use and promote financial inclusion. gulfbusiness.com
The Brief / Digital Payments
95%
SMEs as they realise and capitalise on the growth opportunities that online channels provide.
71%
UNLOCKING POTENTIAL IN SAUDI ARABIA
59%
GLOBALLY
The UAE’s business friendly regime with easy licensing and a supportive regulatory framework has attracted entrepreneurs from all around the world to set up businesses in the country. As a result, SMEs account for 95 per cent of all businesses in the UAE, representing a major stakeholder group in the move to a cashless economy. Driven by increasing consumer demand and greater understanding of the benefits of going digital, digital payment adoption in the UAE isn’t limited to large enterprises. A global survey recently conducted by payments firm Visa, highlighted that 71 per cent of SMEs surveyed in the UAE, against 59 per cent globally, indicated being either cashless or planning to become cashless by 2024. This is backed up by our own data that shows SME transactions now represent 25 per cent of our total transactions in the UAE. E-commerce represents a significant avenue through which the adoption of digital payments can expand growth opportunities and unlock new markets for SMEs. Our data revealed a 44 per cent increase in combined online and offline digital payment volumes for SMEs during 2022. If we were to just consider online payments, the figure would be closer to 75 per cent. This highlights an acceleration in the adoption of online payments by
UNITED ARAB EMIRATES
SMEs ADOPTION VITAL TO ACHIEVING A CASHLESS ECONOMY
SMEs REPRESENT A MAJOR STAKEHOLDER GROUP IN THE MOVE TO A CASHLESS ECONOMY
PLANNING TO BECOME CASHLESS BY 2024
“THE LEVEL OF ADOPTION CONTINUES TO VARY ACROSS THE REGION. FOR INSTANCE, IN THE UAE, DIGITAL PAYMENTS ACCOUNTED FOR APPROXIMATELY 23 PER CENT OF TOTAL TRANSACTIONS IN 2020, WHILST IN SAUDI ARABIA, THE GULF COOPERATION COUNCIL’S BIGGEST ECONOMY AND ONE OF THE MOST POPULOUS, DIGITAL PAYMENT PARTICIPATION WAS ONLY 18 PER CENT”
44% gulfbusiness.com
INCREASE IN COMBINED ONLINE AND OFFLINE DIGITAL PAYMENT VOLUMES
Recognising the economic benefits of digital payments, the Saudi government is targeting digital payment participation of 70 per cent as part of Vision 2030, up from levels of approximately 18 per cent in 2020. Strong progress has already been made towards reaching these goals, with McKinsey & Co., noting that Saudi Arabia saw astronomical growth in card payments of over 70 per cent between February 2019 and January 2020. Not to be outdone, digital point-of-sale (POS) transactions in the kingdom doubled in the year to January 2021. BENEFITS OF DIGITAL PAYMENTS
The transition to a cashless society brings a myriad of other benefits including increased convenience for consumers through the acceptance of multiple payment methods including mobile wallets. Beyond the sheer convenience factor, which became all the more obvious during the Covid-19 pandemic when access to physical cash was partially restricted due to health and safety concerns, having an alternative to carrying physical cash also has a significant impact on personal security and safety. Likewise, going digital has the potential to bring substantial cost savings for merchants and businesses alike by reducing the complexity of their cash management procedures as well as reducing risk of misappropriation. Digital payments form the foundation of the global financial system. Increasing access unlocks a plethora of benefits that come from being connected to the system. Merchants gain access to new forms of funding to grow their business and finance their working capital requirements. Consumers also gain access to innovative services such as buy-now-paylater platforms, enabling them to manage finances by spreading out the payments of goods and services. Businesses adopting digital payments also gain an edge through access to live real time data. This allows them to identify emerging patterns and trends and equips merchants to use data driven insights to drive strategic planning and decision-making. On a larger scale, the wealth of data created from digital payments enables governments to create more reliable economic forecasts, allowing for more effective policy setting. A cashless society, that just a few years ago seemed like an ambitious dream, is fast becoming a reality. May 2022
11
The Brief / Alan’s Corner
Alan’s Corner Alan O’Neill, author, keynote speaker and owner of Kara, specialists in culture and strategy
Creating a lasting legacy
ILLUSTRATION: GETTY IMAGES/NUTHAWUT SOMSUK
Adopt a long-term perspective when building your legacy. Markets evolve, as do customers, creating the need for an organisation to continuously adapt
W
ith a brand recognition probably as strong as McDonald’s, Starbucks is the largest coffee chain in the world. With 32,000 locations and around 350,000 employees, it has a very unique brand that is consistent in all jurisdictions. It has had its ups and downs in recent times, with the company recovering from an alleged racism issue in a Philadelphia store in 2018, that got worldwide attention. Its response was swift and effective, with mandatory training for all staff around the world. 12
May 2022
HOWARD SCHULTZ’S AIM WAS TO ‘REIGNITE THE EMOTIONAL ATTACHMENT WITH CUSTOMERS’
The chain was founded in 1971 in the Pike Place Market in Seattle, which is also known for its famous fish market. Howard Schultz joined the company in 1982 and introduced coffee culture to the American market to great success for the brand. He stepped down as CEO in 2000, but then returned to the same role in 2008. He had to rescue its reputation for declining customer experience and poor treatment of employees. His aim was to ‘reignite the emotional attachment with customers’ and return to the mantra of Starbucks being the “3rd Place” for customers. He eventually stepped down again in 2016. Kevin Johnson the CEO since 2017 left abruptly on April 4 this year and Howard has once again returned to the role. The reason is that the ship needed steadying after much employee unrest and their engagement with unions for the first time. It must have felt like déjà vu for him and the entire organisation. Clearly Schultz is a great leader, at least that’s what Wall Street and Main Street think. But I wonder has he missed a trick in ensuring continuity beyond his own tenure? The brand imagery is strong and the service proposition is consistent across the globe. But why did employee/employer relations deteriorate on at least two occasions? And how did it happen that Schultz had to announce at a recent staff meeting that he wasn’t ‘anti-union’ but ‘pro-Starbucks’? HOW TO BUILD YOUR LEGACY This for me, raises the issue of what it takes for great leaders to shape a great legacy. For most founders of SMEs that I meet, their ambition for their company is often altruistic. Yes of course they want to build value and optimise return on investment. But many of them are so concerned about the future of the company that they find it difficult to hand over the reins. Nevertheless, they do eventually, tending to concentrate mostly on the business strategy, the system and of course the financials. Only some really consider leadership succession and fewer still, consider culture. But what about culture? After all, culture is the golden thread that binds an organisation together. It’s the foundation that underlies all decisions, strategies, investment, and more. Leaders won’t be around forever. Markets will evolve, as will customers and the need therefore for an organisation to continuously adapt. As the world continues to change at an alarming pace and complexity, the one element of a business that enables it to cope, is culture. Here are some tips for refreshing your culture:
In preparing your legacy, conduct an audit of your current culture. Do that with a carefully structured survey and series of focus groups. Make sure the gulfbusiness.com
The Brief / Alan’s Corner “LEADERS WON’T BE AROUND FOREVER. MARKETS WILL EVOLVE, AS WILL CUSTOMERS AND THE NEED THEREFORE FOR AN ORGANISATION TO CONTINUOUSLY ADAPT” audit is objective and authentic. Decide which bits are good and will take the business forward. Design a new culture built on a set of values. After all, culture is all about behaviours, rituals and beliefs. Values are that framework on which a defined and lasting culture is built. Be careful though, as organisations often get this wrong. They list a set of commonly used words or phrases that nobody really believes in, never mind being able to articulate. Google is not a good resource for this important exercise. They need to be your values, carefully tailored in line with your heritage and your ability to utilise them. They should be authentic and measurable. Ensure you have a robust plan to embed them for the long term. They must be embraced by all and everyone should be made accountable for their own role in living them.
gulfbusiness.com
CULTURE
IS THE GOLDEN THREAD THAT BINDS AN ORGANISATION TOGETHER
THE LAST WORD On his return, Schultz said: “Although I did not plan to return to Starbucks, I know the company must transform once again to meet a new and exciting future where all of our stakeholders mutually flourish.” I’m pleased to hear that he has also acknowledged that stakeholders are different in 2022. Schultz obviously cares about the employees and it seems that they trust him too. But if I was fortunate enough to have a chat with him over a coffee, I’d encourage him to carve out a clearly defined culture, making all leaders accountable for it. But as you know, culture change is not easy. Even Wall Street is so far underwhelmed and not giving Schultz any ‘prodigal son’ accolades yet. But that doesn’t mean culture shouldn’t be worked on. It’s quite the opposite in fact. A well-designed and embedded culture will not and should not change frequently. Excuse me now, while I go and make a long-distance call.
May 2022
13
The Brief / Finance A N A LY S I S
THE MIDDLE EAST AND NORTH AFRICA REGION RECORDED 21 I POs LAST YEAR, RAISING $7.9BN, MARKING A
ILLUSTRATION: GETTY IMAGES/VECTORINSPIRATION
133%
SURGE IN TOTAL ISSUANCES
and 214 per cent rise by proceeds, the report suggested. Meanwhile, technology, healthcare and industrials led last year’s sector IPO activity, while the number of unicorn IPOs more than doubled in 2021, reaching 79 in deal numbers, and $83bn in proceeds, compared to 31 listings which raised $31.6bn in 2020.
Going strong Regional IPO activity witnessed significant growth last year, notes Zainab Mansoor
T
he year 2021 proved to be a momentous one for the regional IPO market. According to an EY report, the Middle East and North Africa (MENA) region recorded 21 IPOs last year, raising $7.9bn, marking a 133 per cent surge in total issuances and a 325 per cent rise in total proceeds compared to 2020. Meanwhile, 13 listings took place across MENA markets in the last quarter of 2021, which raised $5.6bn in proceeds. Saudi Arabia’s ACWA Power proved to be the largest IPO in MENA for 2021, raising $1.21bn, the report revealed. This was followed by ADNOC Drilling Company’s listing on the Abu Dhabi Securities Exchange (ADX) which secured $1.1bn, making it the MENA region’s second largest IPO in value in 2021. Saudi Tadawul Group also listed last year, making the kingdom’s stock exchange the third publicly traded bourse in the GCC after Dubai Financial Market and Boursa Kuwait. The IPO market had a banner year globally as well. With a total of 2,388 deals 14
May 2022
raising $453.3bn, 2021 became the most active year for IPOs in the past two decades, up 64 per cent in deal numbers and 67 per cent by proceeds year-on-year. EMEIA (Europe, the Middle East, India and Africa) exchanges posted the highest growth in IPO activity among all regions, marking a 158 per cent increase in numbers
“TECHNOLOGY, HEALTHCARE AND INDUSTRIALS LED LAST YEAR’S SECTOR IPO ACTIVITY, WHILE THE NUMBER OF UNICORN IPOs MORE THAN DOUBLED IN 2021, REACHING 79 IN DEAL NUMBERS, AND $83BN IN PROCEEDS”
KEY INITIATIVES
Several initiatives have been introduced in recent times to bolster regional equity markets. A Dhs5bn Abu Dhabi IPO fund was launched last year to incentivise private sector companies to list on ADX, while the UAE’s Securities and Commodities Authority approved the GCC’s first Special Purpose Acquisition Company (SPAC) regulatory framework in January. Last month, Abu Dhabi-based ADQ partnered with Chimera Investments to launch the UAE’s first SPAC on ADX. Dubai also announced the listing of 10 government and state-owned companies on the DFM last year. Dubai Electricity and Water Authority (DEWA) recently issued nine billion shares, raising $6.1bn, making it the largest IPO in the UAE and the world’s second largest ever in the Middle East. DEWA, which started trading last month, offered 18 per cent of its stake in the IPO. Furthermore, ADX, Boursa Kuwait and Kuwait Clearing Company also signed a cooperation agreement earlier this year to broaden investment opportunities. Boursa Kuwait Securities also reportedly plans to add derivatives and futures products to ramp up liquidity and incentivise companies to list. With several companies announcing their listing plans and key initiatives taken to bolster capital markets, the region’s IPO book for the imminent future looks promising. gulfbusiness.com
The Brief / Productiivty COMMENT
Rehan Khan, principal consultant for BT and a novelist
Line of sight
ILLUSTRATION: GETTY IMAGES/UNIQUEPIXEL
Digital minimalism boils down to understanding just how much technology is needed to support our lifestyle and needs, and cutting out the rest
A
rguably one of the strongest forces of antagonism, leading us to become distracted in our professional and personal lives, is the ubiquitous rise of nonessential digital technologies, which serve little or no purpose. Don’t misunderstand me, digital technologies do have a place, if they help us fulfil our purpose. As a writer, I am indebted to my laptop and software, any amateur cyclist who competes will tell you they are heavily reliant on their tracking and performance apps. I’m not talking about digital technologies, which augment your purpose in life, rather I am referring to the ones that rely on dopamine hits to keep us jacked into an endless cycle of frivolous entertainment. Cal Newport, author of Digital Minimalism (2019), argues that what we need is a “full-fledged philosophy of technology use, rooted in your deep values, that provides clear answers to the questions of what tools you should use and how you should use them and, equally important, enables you to confidently ignore everything else”. Newport forcefully makes the case that we gulfbusiness.com
should spend our online time on a few carefully chosen activities, which support the things we value, and gladly miss out on all others. In others words, ask the question: what do I really value and then determine how technology can supplement this value. Technology should be there to support the thing you value, it’s not the source of value by itself, unless you happen to be a technology geek, then fine, go do your thing. If you are a gardener, use carefully selected technology to become a better gardener. Likewise, if you are a musician, use technology to make you a better artist. Newport’s philosophy’s rests on the following three principles: PRINCIPLE 1: Clutter is costly
Littering our time and attention with too many devices, apps and services results in a negative cost that drowns the small benefits that each individual item provides in isolation. PRINCIPLE 2: Optimisation is important
To unlock the benefit of a technology, think carefully about how to use it.
PRINCIPLE 3: Intentionality is satisfying
When we are more intentional about how we use technology, it leads to significant satisfaction about how we engage with technology. Minimising, decluttering, stripping out distraction, allows us to have clear space for reflection. It’s the very thing the social media companies and those whose business models are built on grabbing our attention through dopamine hits, don’t want us to do. And ironically, it’s the very thing we need to do, if we are going to escape the gravitational pull of frivolous distractions. Here is something you might want to apply in a work setting. Create two categories: vital work and optional work. VITAL WORK: This is what you are paid to do. If you are a sales person it will be to close deals, a financial advisor to manage the portfolio of your client, a consultant to advise your client. If you can stay in this zone, you are providing value to the organisation and are being productive. There will always be a subset of vital work, which may be uninviting to do, such as attending budget meetings, doing mandatory training, writing monthly reports. These uninviting tasks should not take more than 20 per cent of your time and effort, or else you run the risk of losing sight of your main purpose. OPTIONAL WORK: These are all tasks which fall outside the vital, as you do not accomplish much by doing them compared to your vital tasks. For example, tidying up your inbox, clearing out paperwork from the office, reading the newspaper for the fifth time. Generally, you gravitate towards these tasks when you dawdle over doing something else which may be uninviting, such as completing the annual mandatory health-and-safety training which is overdue. When we start something new like a job, or move into a new home, we seem to have a clearer line of sight into what is vital and what is optional, whereas over time this becomes a little fudged. It’s a really useful exercise to do every few months, to recalibrate yourself by asking what is vital and what is optional in both your professional working life as well as in your personal one. May 2022
15
The Brief / Crisis Management A N A LY S I S
Dr Mike Barger, assistant clinical professor of Business Administration and executive director, Ross Online, at the Stephen M. Ross School of Business, University of Michigan
High stakes leadership
ILLUSTRATION: GETTY IMAGES/NUTHAWUT SOMSUK
What should your stakeholders – your families, your businesses, your employees, your communities and others – expect from you in a crisis?
W
e live and work in a world that is becoming more complex, volatile, and uncertain every day. The Covid-19 pandemic and recent crisis in Ukraine have provided all of us with a tangible and, for many, frightening illustration of this reality. While countries around the world have rallied against the virus, their approaches have been varied, 16
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both in terms of strategy and outcome. As these situations have undoubtedly had an impact on you, and everyone around you, you have likely paid a great deal of attention to how those around you have (or have not) been demonstrating leadership. What have you learned? Almost certainly, you have come to the conclusion that rarely has the need for exceptional leadership been so clear or so important.
What should you expect from leaders in a crisis? As a crisis leader, what should your stakeholders – your families, your businesses, your employees, your communities and more – expect from you? A growing body of research offers some answers to these questions. In leading organisations through crises over the past 35 years, I’ve learned three simple principles that apply in every case. First, during a crisis, everyone involved will look to organisational leaders for tangible evidence of leadership. Who is in charge? What actions are they taking? How serious is the trouble we’re in? Second, when these people look for leadership, they want and need leaders that they can believe in. Will everything be ok? Will the company survive? Will I still get the product or service or value that I expected? Will I still have a job? And third, as crisis leadership is ultimately about addressing these concerns and fears, it is critical to truly understand and appreciate the perspectives of those most threatened by the situation. It is not sufficient to view crises from your perspective. You must be able to see a crisis through the eyes of others and to offer them clear, compelling, and tangible evidence of leadership. If you were asked to describe what a crisis leader should be during a crisis, and the characteristics that you would like that leader to demonstrate in the midst of a crisis, what would you say? From your Covid-19 experience, what should a leader be to instill confidence and deserve the trust of stakeholders? Based on our research, the most effective crisis leaders are:
1. Visible. Stakeholders want to see them, in front of their teams, leading the response. 2. Caring. The most effective crisis leaders are able to demonstrate a great sense of care and concern for all stakeholders. 3. Empathetic. Not only must crisis leaders care for their stakeholders, they must appreciate that some have lost or will lose gulfbusiness.com
The Brief / Crisis Management
a great deal as a result of the catastrophe and that their loss deserves acknowledgment and empathy. 4. Calm. Stress and fear produce anxiety in stakeholders. The most effective crisis leaders are able to remain calm, think clearly, and through their composure can help reduce stress and fear in others. 5. Assertive. Not only do stakeholders want to be able to see their crisis leaders, but they want to see them doing something, to be asserting themselves, and working toward a solution. In Asia Pacific, despite the economic fallout, some businesses and organisations have made commitments to reassure their employees – for example, banks in Singapore have pledged to avoid any staff job cuts due to the pandemic. What do you want your crisis leaders to clearly understand – to know – in order to support your organisation and its stakeholders during a crisis? According to our studies, stakeholders consistently want their crisis leaders to have a clear understanding of the following three things:
1. Organisational vision. To be truly effective, crisis leaders should know, be able to articulate, and align their crisis leadership efforts to the organisation’s mission and vision. A portion of every stakeholder’s value proposition is attached to their belief in what an organisation is trying to accomplish. Incorporating the organisation’s vision and mission into a crisis response will resonate with stakeholders. 2. Organisational values. If an organisation’s vision describes what it is trying to accomplish, then its values describe the way it plans to get there. A great deal of research has been done on the extent to which employees aspire to work for a company that shares their values. New research indicates that other stakeholder groups — particularly customers — want values alignment as well. In a crisis, stakeholders will be looking for an organisation to “walk the talk”. This is best demonstrated through values-driven leadership. 3. Guiding principles. Crisis leaders will be required to make an incredible number of decisions with limited information. Many gulfbusiness.com
“STAKEHOLDER ENGAGEMENT MAY BE THE MOST VALUABLE AND IMPORTANT ACTION A CRISIS LEADER CAN TAKE. FOR A GIVEN CRISIS, EXCEPTIONAL CRISIS LEADERS TAKE THE TIME TO DETERMINE HOW ALL OF THEIR STAKEHOLDER GROUPS HAVE BEEN OR WILL BE IMPACTED” of these decisions will prove to be less than perfect over time as new information becomes available. This is not typically a product of poor decision-making, but rather, a function of the crisis environment. What can be done to improve this seemingly impossible situation from crisis leaders? The most effective crisis leaders create and share a set of guiding principles that can be used in the decision-making process. Examples of guiding principles include: We will value, protect, and support our people. We will deliver on the vision and mission of our organisation. We will communicate effectively and thoughtfully with all of our stakeholders throughout this crisis. Principles such as these can help stakeholders understand how decisions will be made before they begin to judge them after they have been made. What should crisis leaders be doing during a crisis? Research points to four of the following primary actions that are core to effective crisis leadership:
1. Communicate. We know that stakeholders are anxious during a crisis because their value propositions are being threatened. Given these concerns, these stakeholders want and need information, as well as clear, compelling, consistent and reliable communication. As a crisis leader, you should establish a communication plan, inform stakeholders of your plan, and become their primary source of learning about your intentions, your actions, and the facts as they become available.
2. Make decisions with limited information. A primary responsibility of every leader is decisionmaking. Unfortunately, during a crisis, leaders will be required to make urgent decisions with limited information. As mentioned earlier, this is why guiding principles become so important. But these principles won’t resolve the fact that decisions made by crisis leaders will typically produce as many poor outcomes as good ones. Exceptional crisis leaders embrace the reality that decisions made early in a crisis may have to be modified or even reversed as more is learned about the situation. This reality will make decision-making uncomfortable, but the alternative of not making decisions until all the facts are in and the choices are clear will almost certainly produce disastrous results. 3. Take responsibility. Stakeholders will want to understand what led to the crisis and who was ultimately at fault. As humans, we are wired to be extraordinarily curious about causation and the attribution of blame. When it is clear that the organisation or a member of the organisation is at fault in a crisis, the most effective crisis leaders communicate this reality to their stakeholders at the earliest opportunity. 4. Engage stakeholders. Stakeholder engagement may be the most valuable and important action a crisis leader can take. For a given crisis, exceptional crisis leaders take the time to determine how all of their stakeholder groups have been or will be impacted, and engage each of them in a way that helps them understand that they care, that they empathise, that they are taking ownership of a resolution, and that they are committed to creating a stronger organization going forward as a result of what they have learned through this crisis. During a crisis, stakeholders will be looking for tangible evidence of leadership. They will want and need leaders to believe in, who understand and appreciate their perspective. They will not expect crisis leaders to be perfect or omniscient, but they will expect them to be visible, courageous, and committed to the best possible path forward. May 2022
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The Brief / Savings COMMENT
ILLUSTRATION: GETTY IMAGES/SORBETTO
Simon Barwell, marketing director of Friends Provident International and board member of International Financial Group
Prepared for retirement?
Start saving early to get a head start towards financial security during your retirement
F
or some, retirement is about travel and adventure, while for others it’s about finally being able to find time to relax at home with the family. Then there’s a myriad of retirement styles in between. All of them have at least one thing in common – the need for adequate finances to sustain them. 18
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And then there’s the fact that we’re all living longer than previous generations. This means we’ll need to find more money to fund that ‘bonus’ part of retirement. The current average life expectancy in the UK, UAE and India is 81.77, 78.46 and 70.42 respectively, and this is expected to increase over the next 20 years.
So, what should we be doing to ensure we can sustain our finances throughout retirement, whatever it may throw at us? START SAVING NOW
According to a survey we commissioned, with a sample size of 1,009 respondents across the UAE, 63 per cent of the respondents planned to retire before they reached the age of 60, 45 per cent admitted they hadn’t even started saving for retirement. It’s clear that people are leaving it late to start saving, with 16 per cent saying they would wait until five years before they retire to start saving; 22 per cent said they would start saving between 5 and 10 years before, and 18 per cent between 10 and 15 years before. Just 25 per cent said they would plan more than 15 years ahead, with 19 per cent saying they didn’t know when they would start saving. People also vastly underestimated how much money gulfbusiness.com
The Brief / Savings
they would need per month when they retired. More than half of those surveyed said they would need less than $5,000 a month to live on during retirement. This leaves little room for unexpected costs. BUDGET STRATEGICALLY
You may be used to planning a linear budget but, when it comes to retirement, there are likely to be three very different stages which actually form more of a ‘U’ than a line. Stage one: This is where you’re likely to spend the most money, splashing out on everything you dreamed you would do when you finished working (for example on travel, motorbike, holiday–home). Stage two: The settled period - where life returns to normal and you live in a more regular pattern (socialising, golf, spending time with the family). Stage three: The unknown, such as healthcare costs and age care expenses, get thrown into the mix. This stage, although not as much fun as the first stage, can be almost as costly.
THE CURRENT AVERAGE LIFE EXPECTANCY IN THE UK, UAE AND INDIA IS
only in planning your retirement, but also to help you keep on top of your money after you’ve retired. Regular meetings with your financial adviser after you’ve retired will help you assess if you’re still on track to fund your retirement. Again, the earlier you identify any issues and make any adjustments, the better.
DON’T SWITCH TO INVESTMENT AUTOPILOT AS SOON AS YOU RETIRE
RETIREMENT EXPENSES
Managing your investments once you retire continues to be crucial. Many people move to lower risk asset allocations when they give up work, which means their focus shifts to preserving rather than growing their wealth. This is a fair strategy, however, if you’re doing this yourself, you’ll need to consider any tax liability you may trigger when switching investments. It’s worth seeking out the services of a financial adviser to help guide you not
If you find your retirement income is no longer covering your expenses, there are a few things you can do. You may not want to, or may not be able to, take on a job and so reducing your expenses or freeing up your capital by selling assets is the obvious option. For most people this may mean selling their property. This could entail moving to a different area with a lower cost of living or staying where you are, but downsizing
“MANY PEOPLE MOVE TO LOWER RISK ASSET ALLOCATIONS WHEN THEY GIVE UP WORK, WHICH MEANS THEIR FOCUS SHIFTS TO PRESERVING RATHER THAN GROWING THEIR WEALTH” gulfbusiness.com
81.77, 78.46 AND 70.42 RESPECTIVELY, AND THIS IS EXPECTED TO INCREASE OVER THE NEXT 20 YEARS
to a less expensive home. Many people have their money tied up in property and downsizing in later retirement frees up capital to support costs incurred during this period. You could cut back on non-essential costs, like life insurance if your children are grown and able to support themselves. If you’re a two-car household you could save by cutting back to one. DON’T PUT IT OFF
The single most important thing you can do for your future self is to start saving now. Firstly, consider at what age you want to retire and think about what you want your retirement to look like. Then, plan for building up a sufficient pension pot to sustain this desired lifestyle. Think seriously and be realistic about how much money you might need, adding in a contingency for unexpected costs. The amount may surprise you but it’s important that you tackle the issue head on. May 2022
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The Brief / Planning Rita McGrath and Dr M Muneer McGrath is a professor at Columbia Business School and founder of Valize, and Dr Muneer is the co-founder and chief evangelist at the non-profit Medici Institute
ILLUSTRATION: GETTY IMAGES/MALTE MUELLER
COMMENT
The key to strategy The purpose of a good and agile strategy is to enable smooth decision-making throughout the organisation
I
t’s unfortunate that strategy has come to mean just about anything that those in an organisation deem to be important. So we have strategic human resources, strategic finance, and even strategic procurement. When things aren’t predictable, solid strategies are essential – they help provide guidelines and act as guardrails. When well crafted, they get you past the “frozen-in-the-headlights” reaction many have to uncertainty – as we have witnessed in 2020. Strategy started as a concept in military thinking. One of the most misunderstood ideas in strategy is that decisions are made at the ‘strategy’ level and everybody else just executes them. The purpose of a good strategy is to allow smooth decision-making throughout the organisation – particularly at the ‘edges’ where real information about what’s going on exists. Strategy is all about making choices – both of what to do, and even more importantly, what not to do. There are two main reasons that having a clear strategy is helpful: that resources are not unlimited, and there’s competition – for customers, talent, assets and attention. No business can just try every idea that comes to its leaders – you need to have some way of selecting from alternatives and prioritise. As for competition, even if 20
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you did demonstrate that a course of action led to success, others would catch up soon. The trouble with strategy is that not everyone will understand it. In our consulting experience, 95 per cent of employees don’t have the same understanding of their organisation’s strategy. We have seen many failed strategies from small to mammoth businesses – all of them are victims of concepts that didn’t work, but were never tested prior to someone making a corporate level commitment. Far too many expressions of strategy are really statements of goals in disguise. “We want to be number 1 or 2”, is a popular example. Increasing operational efficiency, targetting this or that market, or becoming more or less of something are all statements of intent, but they say very little about how you plan to make the choices and the trade-offs that would realise these goals. Consider this: “To thrive as a mass merchandising company that offers customers quality products through a portfolio of exclusive brands and labels.” That was the one-time strategy statement of a leading retail chain, which was acquired cheaply by another retail chain. Karl Weick, an American organisational theorist, points out that in uncertain and confusing circumstances, the goal of strategy is often directional, not predictive.
Strategies are not about ironclad unchanging five-year plans. They are about making the best hypotheses with imperfect information, providing clarity to people and founding an environment in which people up and down the organisation are at liberty to make smart choices. So, what are the implications for the business leadership facing uncertainty this year? As rates of uncertainty increase in the environment, a new perspective on strategy is emerging. It relies less on analysis and more on pattern-recognition than conventional prescriptions. It embodies the sense that strategies themselves must adapt in an agile manner. It recognises that when the landscape is very uncertain, strategies may no longer be precise, and a directionally correct strategy that emphasises learning may be the one to adopt. Leading indicators, not lagging ones, become more important. It is critical to also have a framework to link operations with strategy so that the real changes get measured quickly and communicated upwards without dilution or confirmation bias. Regular strategic reviews should be the norm to stay agile. A leadership model that does not presume that all information is possessed at the “top” of an organisation is further essential. In fact, strategies need to incorporate deep insight into the organisation’s capabilities, as well as rich insight into the context in which the company is operating. Leaders today are often seen as choosing among options that the organisation generates in structures that are increasingly “permission-less.” Here are some of the challenges leaders are facing in 2022: Workforce burnout, destructive innovation, funding sustainability, new waves of stringent regulations, adaptation and resilience of infrastructure assets, growing political polarisation, trade wars, massive convergence of technology, mutated Covid-19 waves, implementing flexible working hours, data and AI regulations, balancing human resources with humanoid robots, new funding options such as ICOs (initial coin offerings), tokenisation and SPACs (special purpose acquisition companies). Only a strategy that is well-crafted and agile will help to sail through the fog this year. gulfbusiness.com
The Brief / Edtech
ILLUSTRATION: GETTY IMAGES/FANATIC STUDIO/GARY WATERS
COMMENT
The digital transformation of education The Middle East and North Africa education technology and smart classroom market is forecast to grow to $7.1bn by 2027 22
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Sahem Azzam, vice president, Orange Business Services Middle East & Africa
W
hile Covid-19 boosted online learning, even before the pandemic there were good levels of adoption in education technology, also known as edtech. However, the pandemic proved that the online learning model can work at scale and demonstrated that we have a lot of the technologies now in place to enable and enhance it. So, I think it is important to look at smart education in terms of possibilities: what is the situation now and where might we be able to take it?
GLOBAL OUTLOOK In 2020, investment in edtech companies skyrocketed and as of early November 2021, there were 32 edtech unicorns, with a valuation exceeding $1bn, around the world. Between them they have raised over $21bn in total funding and are now collectively valued at over $95bn, based on reasearch from market intelligence firm, Holon IQ. According to the gulfbusiness.com
The Brief / Edtech IN 2020, INVESTMENT IN EDTECH COMPANIES SKYROCKETED AND AS OF EARLY NOVEMBER 2021, THERE WERE
firm, the global edtech market is forecast to be worth $404bn by 2025, at a CAGR of 16.3 per cent
32 EDTECH UNICORNS
THE REGIONAL PERSPECTIVE The Middle East and North Africa (MENA) is fast becoming one of the most progressive places in the world for education. Historically, the region, made up of 21 countries with a combined population of over 400 million – more than 60 per cent of whom are under the age of 24 – has been known as an exporter of students. Today, that situation is changing. With new world-class universities attracting international students from across the globe, the Middle East is one of the fastest-growing regions for education today. Smart education in general is on the rise throughout MENA. According to research, the Middle East and North Africa education technology and smart classroom market is forecast to grow to $7.1bn by 2027, as the impact of the pandemic continues to accelerate the shift to digital education.
VIDEO AND VR The past year-and-a-half saw a massive increase in the use of video calling apps, growth that took place in the workplace of course, but also in education. Teachers and students who had never previously used videoconferencing had to immediately sign up, get familiar and start using it, as it became essential for online learning. Virtual reality and augmented reality (VR/AR) tools seem ideally suited to smart education as well. They have already made their presence felt in the gaming sector, bringing down the cost of headsets and related equipment. Moving forward, VR and AR present the possibility of creating highly immersive lessons that are fun and engaging. They could also drive increased participation in classes by students from a digitally-native generation.
Recent news has also revealed a possible future for smart education in the metaverse. Today’s generation of school students is entirely comfortable with virtual worlds, thanks to MMORPGs (massively multiplayer online role-playing games) such as Minecraft and Roblox, so an immersive, metaverse-based classroom wouldn’t be much of a leap for them.
AI AND ANALYTICS Artificial intelligence (AI) could also have a big role to play. It can enable much more personalised learning experiences or be used to facilitate one-to-one tutoring with the use of intelligent tutoring systems. Chatbots could be used more widely in education. During the pandemic, some education institutions integrated chatbots into their systems to help with the automation of tasks, such as the resolution of student queries. I think it’s likely that this trend will grow as we move forward. Learning analytics can be used to empower educators by tracking learning processes to make better informed, data-driven decisions. For example, it can help in areas such as behaviour and performance prediction, whereby educators can more accurately forecast the performance of students based on past performance. Gamification could also grow in popularity. Learning through play has been a popular educational concept for many years, but digital technologies could take it to the next level. As mentioned, today’s Gen Z end users are all habitual gamers in daily life, so gamification of the classroom could become a useful instructional tool, helping make complex subject matter more exciting and interactive experiences.
ALL THE PIECES IN PLACE
“GAMIFICATION COULD GROW IN POPULARITY. LEARNING THROUGH PLAY HAS BEEN A POPULAR EDUCATIONAL CONCEPT FOR MANY YEARS, BUT DIGITAL TECHNOLOGIES COULD TAKE IT TO THE NEXT LEVEL. AS MENTIONED, TODAY’S GEN Z END USERS ARE ALL HABITUAL GAMERS IN DAILY LIFE, SO GAMIFICATION OF THE CLASSROOM COULD BECOME A USEFUL INSTRUCTIONAL TOOL”
gulfbusiness.com
Smart education tools have the potential to scale classes to larger numbers and to provide more individualised, personalised learning. They offer immersive learning and easier access to more resources for students. Smart education can increase collaboration between students and, through gamification, make learning more fun. And perhaps most significantly, edtech and smart education can better prepare students for the world of work, where so many jobs are now powered by digital technologies. One research report found that 86 per cent of educators now say that technology is at the core of learning. I expect that number to keep on growing as digital transformation continues to impact a once very traditional sector. May 2022
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The Brief / Infographics
Taking to the skies Air passenger traffic volumes were affected by the Covid-19 pandemic in 2020, with industry-wide revenue passenger-kilometres dropping 65.9 per cent year-on-year, as per IATA’s World Air Transport Statistics 2021
WE’VE BUILT UP SOME GREAT MOMENTUM THIS YEAR AND EXPECT BUSINESS GROWTH TO PICK UP SPEED IN 2022. AVIATION HAS ALWAYS BEEN RESILIENT, AND WE WILL CONTINUE TO WORK WITH OUR INDUSTRY PARTNERS TO BUILD BACK BETTER FOR OUR CUSTOMERS AND COMMUNITIES” SHEIKH AHMED BIN SAEED AL MAKTOUM,
123,997
Emirates’ chairman and chief executive (Dec 2021)
110,650
106,488
100,188
IN MILLIONS
88,728
87,263 78,746 71,417
64,928
QA TAR AIR WA YS
RY AN AIR
AIR CH INA
EM IRA TES
SO UT HW EST AIR LIN ES*
CH INA EAS TER NA IRL INE S
UN ITE DA IRL INE S
CH INA SO UT HE RN AIR LIN ES DE LTA AIR LIN ES
AM ER ICA NA IRL INE S
57,171
TOP 10 AIRLINES BY *RPK
(*Revenue passenger-kilometres)
FEDERAL EXPRESS
UNITED PARCEL SERVICE
QATAR AIRWAYS
EMIRATES
CATHAY PACIFIC AIRWAYS
KOREAN AIR
CARGOLUX
TURKISH AIRLINES
CHINA SOUTHERN AIRLINES
CHINA AIRLINES
19,656
14,371
13,740
9,569
8,137
8,104
7,345
6,977
6,591
6,317
TOP 10 CARGO BY *CTK
IN MILLIONS
(*Cargo tonne-kilometres)
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gulfbusiness.com
PASSENGER LOAD FACTOR
REVENUE PASSENGERKILOMETRES (MILLIONS):
($ MILLIONS)
2,986,993 AVAILABLE SEATKILOMETRES (MILLIONS):
2013
25,300
10,700
2014
35,450
13,802
2015
61,962
35,971
2016
60,144
34,191
2017
56,600
37,600
53.8%
2018
45,947
27,250
231,342
2019
43,159
26,366
-105,000
-126,400
2020*
TRAFFIC BY ROUTE AREA
*PRELIMINARY
OPERATING RESULT
Percentage of international scheduled Revenue Passenger-Kilometres
4,589,378 CARGO LOAD FACTOR
CARGO TONNEKILOMETRES (MILLIONS):
AVAILABLE CARGO TONNEKILOMETRES (MILLIONS):
430,016
$128.2bn
NET RESULT
THIS IS A NEW ALL-TIME HIGH REVENUE FROM TRANSPORTING GOODS BY AIR
REGIONAL OVERVIEW
Ranked by revenue passenger-kilometres RANK
AIRLINES
MILLIONS
01
Emirates
78,746
03
Qatar Airways
57,171
16
Etihad Airways
19,747
22
Saudi Arabian Airlines
14,328
5.7%
82.6%
8.9%
gulfbusiness.com
8.4%
21.1%
5.5% 2.0%
3.8% 0.3% Central America Caribbean
2.3%
0.7% South America
0.4%
2020 2019
1.6%
5.7%
8.5% 7.6% MIDDLE EAST
4.3%
0.7% 2.7%
27.2%
IN 2020
Asia
Europe
North America
1.3%
TRAFFIC BY ROUTE AREA
ROSE BY
All-time high load factor percentage in 2019 reversing strong gains prior to the crisis
4.6%
Percentage of international scheduled based on revenue passengerkilometres
SOURCE: WORLD AIR TRANSPORT STATISTICS 2021
65.1%
OPERATING AND NET RESULTS
3.0% 1.3%
Africa
Southwest Pacific
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The Brief / Lightbox
People celebrate with fireworks during a mass iftar gathering held at Ezbet Hamada in Al Matariyyah district during the holy month of Ramadan on April 16, in Cairo, Egypt. Residents of the neighbourhood organised the event for the first time since the onset of the Covid-19 pandemic in 2020. 26
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PHOTO: FADEL DAWOD/GETTY IMAGES
AS THE METAVERSE DISRUPTS THE EXISTING TECHNOLOGICAL LANDSCAPE, EVERDOME AND METAHERO ARE ON A QUEST TO CREATE SOMETHING THAT THE WORLD – OR AT LEAST THE VIRTUAL ONE – HAS NOT SEEN YET
HAS 28
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WO R D S : D I V S H A B H AT
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M
ark Zuckerberg once said, “Today, I think we look at the internet. But in the future, you are going to be in the experiences.” The “experiences” that Zuckerberg refers to are realised in what we now call the ‘metaverse’, which sounds like an idea created by sci-fi writers. A network of 3D virtual worlds blur the lines between our physical and digital lives. The metaverse allows us, or for the moment promises to allow us to do everything that we do in real life, but in a virtual world. These could include everyday activities such as visiting shopping malls and meeting friends to far more complex tasks such as purchasing property and undergoing a medical teleconsultation in ways that feel eerily similar to the real world.
For those who have been in Web3 for some time, the metaverse is not a new concept. However, until a few years ago, virtual worlds where characters roamed around as ‘avatars’ could be seen only in games and movies. The term metaverse was coined by Neal Stephenson in his 1992 science fiction novel, Snow Crash, in which humans interact parallelly with each other and with software agents in a 3D virtual universe. Fast forward to 2022, market research firm Statista predicts the metaverse concept will no longer be a fantastical one, but instead a universe of which revenues will surge to $678.8bn by 2030. “I like to think of the metaverse as the next evolution of not only human communication, but of society as a whole,” says Rob Gryn, chief executive officer and founder of Everdome and Metahero. “It will play a role in redefining our entire relationship with the internet, especially as we move into the Web3 era. The metaverse brings together all aspects of our society from communications to brand experiences and marketing, economic transactions with cryptocurrencies and nonfungible tokens and everything between.”
A new dawn
Gryn has always been passionate about cryptocurrency and metaverse, even during his days in Codewise as chief executive officer. He noticed a clear shift happening in the world, which is everything moving towards being enabled by increasingly intelligent technology. He chose to launch Everdome and Metahero on blockchain, as he saw the least amount of restriction, particularly in delivering the product and idea quickly to the market. “It also offered direct access to a community that provides immediate feedback, which is every executive team’s dream,” comments Gryn. “It’s quite exhilarating to play a part in defining the natural evolution of how we communicate and engage with each other and the world around us. So, when the opportunity arose to venture into the world of crypto and metaverse, I took it,” he adds. 30
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We can accurately recreate the real world with incredible realism and photo accuracy which you’ll see in Everdome’s hyperrealistic environment and that opens up countless possibilities for anything and anyone. There are practically no boundaries, which makes it so exciting.” The Dubai-based company, Everdome, aims to leverage Metahero’s ultra-HD photogrammetric scanning technology to bridge the physical and digital worlds allowing people to replicate real-world objects in photo-realistic 3D. This provides a platform for the creation of NFTs. “We can accurately recreate the real world with incredible realism and photo accuracy – which you’ll see in Everdome’s hyper-realistic environment – and that opens up countless possibilities for anything and anyone. There are practically no boundaries, which makes it so exciting.”
Bridging the physical and digital world
The metaverse is free of limitations, and people will be able to explore all corners of this virtual world. They may, for example, push the boundaries of things like marketing and sales by creating immersive customer experiences. Anything in the real world can be replicated in the metaverse, and the only limit will be someone’s imagination. The Middle East, UAE and Saudi Arabia are heavily investing into this technology. Recently, Dubai Municipality announced that it will work with private sector companies and investors to create a futuristic, human-centred version of the city that capitalises on opportunities thrown up by the metaverse. Meanwhile, Saudi Arabia said that the kingdom will invest over $6.4bn in advanced technologies, including metaverse and blockchain. “The Middle East has a culture of early adoption and innovation, especially in the UAE and Saudi Arabia. gulfbusiness.com
That’s why it’s so refreshing to be here and also why we chose Hatta, in Dubai, as the virtual launch site of the Everdome mission. The UAE’s got strong interests in Mars, which made it a natural fit - and Hatta’s mountains look amazing in our metaverse,” adds Gryn. He believes there is massive scope in the region in terms of growth potential. “People here want to be part of the latest trends, especially when it comes to technology and gaming. When people are excited about something, brands get excited too, which means they will make a move to invest in their metaverse presence. That will fuel the Web3 economy, especially in light of the push cities like Dubai are making towards blockchain and digital finance.”
Diversified business model
Officially registered in Dubai, Everdome’s business model is based on business-to-business (B2B), business-toconsumer (B2C), and peer-to-peer (P2P). The firm offers a diverse range of metaverse-related services, including digital real estate, in-game and in-verse purchases, NFT collection drops, sales and trades, using the Dome crypto token that was launched in February. Token investment is the first driver in an open crypto project or economy. However, there are several challenges any business model faces. Gryn highlights their primary challenge to be competition. “Competition is stiff, but it helps a sector to thrive and provides the opportunity to stand out. There are several metaverse projects out there, but none of them are quite like Everdome. We’re setting ourselves apart with hyper-realism.” Other challenges pointed out by Gryn include mass crypto adoption, technological scaling, and education. “Each of these challenges has its own place in how we grow and evolve. They represent areas for a potential breakthrough, especially with the kind of tech and financial systems we work within.” May 2022
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Making assets valuable
The process of land acquisition in the metaverse has grown in popularity of late, both in interest and prices, notably with recent entrants such as financial companies JP Morgan and HSBC buying plots of virtual lands. According to an analysis by the Centre for Finance, Technology, and Entrepreneurship (CFTE), 8,000 land parcels were sold every month between November 2021 and January 2022 at an average transaction price of 3.5 Ethereum (equivalent to approximately $13,000). Gryn explains how virtual real estate is the product that people invest in and how they can develop the property that has evolved with the introduction of metaverse land sales. “From the earliest days of the internet, people have invested in domain names, which are, essentially, your own little piece of the internet. You own it; you build on it; you sell it when you want to. So in principle, buying and developing a domain name in 2D internet is much the same as purchasing and building upon the land in a 3D internet,” he adds. He further highlights the most significant difference of what people can do with their land in the metaverse. With advances in technology and the evolution of 3D visuals, owners of the land can create incredible things with very
few restrictions that can potentially enhance the value of their land, which, of course, is very similar to what they can do with physical real estate, in the real world. However, he goes on to say that the kind of people who invest in virtual land are very varied. “There are major supporters of blockchain technology, for example, and corporations that want to build out the companies’ capabilities for a metaverse-based future, so they are prepared for the next evolution of human communication and interaction. There are also individuals, just regular people, who recognise the opportunity and are keen to invest.” Everdome, for example, is currently selling real estate. People can invest in a piece of their version of Mars, which they can then develop as they like – just as they would in the real world. The same applies to marketing. Brands can get creative with subtle product placements, or go for a more traditional approach adapted for the metaverse, with billboards on verse streets.
Shopping in the Metamall
Meanwhile, it appears that consumers have grown accustomed to, and even expect, retailers to innovate in the metaverse. As a result, many new firms have entered the metaverse in recent months to capture customers’ attention and surprise them with innovations. Nike is one of the brands that has taken major strides into the metaverse. Rtfkt, an entity that specialises in creating NFTs, was bought by Nike through which it will be able to build its own digital footwear and clothing. Gucci also purchased a virtual land in the SandBox in order to extend its Gucci Vault, an online concept shop, and provide a more involved consumer experience. Furthermore, Walmart also intends to wade into the metaverse, with plans to launch its own cryptocurrency and NFT collection. The store has filed multiple new trademarks indicating its intention to manufacture and sell virtual items, such as electronics, home décor, toys, and personal care products. Additionally, Walmart stated in a separate filing that it will give consumers virtual currency in addition to NFTs. Talking about the experience of shopping in the metaverse, Gryn says, “Imagine your shopping experience in
8,000
WERE SOLD EVERY MONTH BETWEEN NOVEMBER 2021 AND JANUARY 2022 AT AN AVERAGE TRANSACTION PRICE OF LAND PARCELS 3.5 ETHEREUM (EQUIVALENT TO APPROXIMATELY $13,000)
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Brands can get creative with subtle product placements, or go for a more traditional approach adapted for the metaverse, with billboards on verse streets” the real world, and then take away limitations such as gravity, geographical location, even restrictions such as pandemic precautions. These things don’t exist in the metaverse, making everything more accessible whenever you want it.” For retailers, this creates immense scope to showcase their products on an entirely new level. On platforms such as Everdome, customers will be able to experience the products they want to buy on and as close to a realto-life level as is possible right now, whether that’s trying on new clothes, exploring a holiday destination or even investing in property. While we can’t wait to discover and explore this virtual world, Everdome has even more exciting plans for the year ahead. The company has created a three-phased strategy to roll out its tech in increments throughout 2022. “This will allow people to get in early and be part gulfbusiness.com
of the development as we continue to build. As they say, Rome wasn’t built in a day, Everdome won’t be built in a day, either,” says Gryn tongue in cheek.
The virtual future
Gryn envisions a future where they can allow an entire generation to experience the growth of a digital settlement on another planet, which will be something truly remarkable to see unfold. “In terms of how we’ll appeal to Gen Z and Millennials, our hook is simple – deliver the highest quality possible in the shortest time. Yes, I know that may sound like a pipe dream, and we’re under no illusions that it will be a seamless process without any setbacks, but that’s how we like to learn. It keeps us on our toes and prompts rapid innovation.” Over the coming months, the company will also announce new partnerships that it believes will enrich the metaverse experience for everyone, bringing things that people enjoy in the real world into our digital ecosystem. He adds, “Our goal is to create a metaverse that blurs the boundaries between reality and in-game play, and these partnerships edge us a few more steps closer to that.” The metaverse has evolved over the years, and the market looks ready to embrace the virtual world, despite growing competition. Everdome stands ready to innovate and compete. While the current metaverse concept is only just evolving, Everdome’s agenda has readied it for the next few years which is billed to be the metaverse’s golden decade of growth. May 2022
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FEATURES / EXECUTIVE EDUCATION
BACK TO BASICS WHY TOMORROW’S CENTRAL BANKERS NEED TO THINK LIKE MBA STUDENTS
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fter an extraordinary series of global supply chain snags caused by the pandemic, the next generation of central bankers is taking a page from the business school play book, learning how the market reacts to bottlenecks and what monetary policy can do to help. The educational shift, seen recently at a master’s programme in Malaysia for young policy makers, underscores how the flow of goods has become key to understanding the way two years of supply chain snarls helped drive up consumer prices the fastest in decades. As part of the course, set up by the Asia School of Business with backing from the Massachusetts Institute of Technology, students play the ‘Root Beer Game’, a version of the decades-old classic in MBA programmes that helps illustrate supply and demand signals and dynamics, from producers down to consumers. Young officials played alongside students from the business school, allowing them an opportunity to simulate how the flow of goods impacts monetary policy decision making. “It corresponds to what happens in the real world,” says Vipichbolreach Long, of the National Bank of Cambodia, who played the role of a retailer. “We can see the chaos
May 2022
in the supply chain with manufacturers and wholesalers confused when the signal from downstream was unclear, and what that means for monetary policy transmission,” Long says. There’s been no shortage of teachable moments on the course as the pandemic forced central banks to unleash trillions of dollars’ worth of unprecedented support for governments, households and companies as the world economy froze. How that stimulus, which helped drive a surge in demand, collided with supply chain issues surprised policy makers globally, including at the Federal Reserve. Initial predictions by policy makers that price pressures caused by supply shortages would prove transitory have fallen flat.
MOVE EARLIER
Chair Jerome Powell, testifying before Congress recently acknowledged that, in hindsight, if the Fed understood how the pandemic-induced bottlenecks would collide with strong demand “it would have been appropriate to move earlier” in normalising policy.
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FEATURES / EXECUTIVE EDUCATION
That’s among lessons policy makers from Asia, as well as Saudi Arabia, Sudan and the Maldives, are learning in the full-time, one-year residential course for a Masters of Central Banking, which includes a six-week programme at MIT. The fee of 365,000 ringgit ($86,700) includes accommodation in Kuala Lumpur and travel to Washington, New York and Cambridge, Massachusetts. While flooding their economies with money helped to drive a quick recovery, the monetary policy binge will leave a legacy that future central bankers will be dealing with for years to come. House prices and stock markets have soared through the pandemic, fuelling concerns over widening inequality, and leaving officials with the challenge of raising rates without crashing the recovery. The exercise comes as policy makers the world over are scrambling to work out what, if anything, central banks can do in response to supply driven inflation. Eli Remolona, who runs the course, says the ‘root beer’ exercise offers lessons on how lag effects work and how hard it can be to predict the way policy impacts the economy. “We leverage on the pandemic and how central banks have responded,” says Remolona, who formerly was chief AsiaPacific representative at the Bank for International Settlements and also had a long career at the Federal Reserve Bank of New York. gulfbusiness.com
In another assignment away from their text books, the young officials are given the opportunity to critique press conferences given by the Fed’s Powell and his European Central Bank counterpart, Christine Lagarde, in order to hone their own communication skills. It’s especially important to monitor the likes of the Fed and ECB given their policy moves eventually spill over to emerging market economies, says Arlene Aguinaldo of Bangko Sentral ng Pilipinas. “It does make us appreciate how difficult it is to communicate well” on monetary policy, she says.
BETTER EQUIPPED
The curriculum covers topics that include
IN ANOTHER ASSIGNMENT AWAY FROM THEIR TEXT BOOKS, THE YOUNG OFFICIALS ARE GIVEN THE OPPORTUNITY TO CRITIQUE PRESS CONFERENCES GIVEN BY THE FED’S POWELL AND HIS EUROPEAN CENTRAL BANK COUNTERPART
365,000 Ringgit ($86,700) THE FEE THAT INCLUDES ACCOMMODATION IN KUALA LUMPUR AND TRAVEL TO WASHINGTON, NEW YORK AND CAMBRIDGE, MASSACHUSETTS
crisis prevention, behavioural finance, cybersecurity, digital currencies and ethics. Advisers to the course span the world of central banking such as Zeti Aziz, former governor of Bank Negara Malaysia, Robert Merton, MIT academic and Nobel Laureate in economics. Students interviewed for this article, who spoke in a personal capacity and were not representing their central banks, say the programme allows them to hear from world leading economists and former policy makers while at the same time networking with peers from emerging economy central banks. “We cannot give a guarantee we’ll prevent the next crisis,” says Yi Duan Ho, of Bank Negara Malaysia. “But we are better equipped to go through it.” (Bloomberg) May 2022
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BRAND VIEW
Bolstering industrial cybersecurity The industrial cybersecurity community should pay closer attention, as cyber adversaries aggressively target critical industries such as factories and power utilities
I
ndustrial infrastructure is fundamental to our modern lives. While we don’t think too much about power plants or manufacturers continuously operating, when they are forced to shut down due to a cyberattack, it can cause significant crises – as we saw with the Colonial Pipeline breach in the US last year. While many companies are mandated to protect financial and technical institutions, Dragos focuses on providing cybersecurity solutions for asset owners managing the industrial control systems (ICS) and operational technology (OT) that keep these critical industries online.
ICS/OT security: Building resilience Cyberattacks targeting tech companies or financial institutions are primarily driven by money. But cyberattacks targeting critical industries such as power, oil and gas, mining, pharmaceuticals, or food production can be motivated by other more destructive intents. “Many threat groups target industrial sites worldwide, whether they are state actors, criminals, or whomever,” says Dragos CEO and co-founder Robert M. Lee. “Sometimes they leverage ransomware in order to ransom a power plant or other industrial infrastructure to get money, for example. Sometimes they get access to intellectual property, such
as manufacturing methods and how the industrial process is designed. Sometimes, they are prepositioning for a future cyber event.”
State groups are the most dangerous As the world becomes increasingly connected and reliant on digital systems, targeting these technologies is an effective way to conduct a cyberattack today. Many governments have moved their military efforts to cyber space as a new offensive method. As a result, in recent years we have seen the emergence of some of the most dangerous cyber adversaries. These groups include the Lazarus Group, responsible for the WannaCry attacks that made ransomware widely known and one of the most important modern cyberthreats. Also, the threat group Fancy Bear leaked highly sensitive
Many threat groups target industrial sites worldwide, whether they are state actors, criminals, or whomever”
information about US politicians in 2016 and attacked anti-drug organisations in 2019. Among the most famous is the threat group Cozy Bear, which is believed to be behind the SolarWinds attacks, one of the most significant supply chain attacks so far. According to Lee, Dragos is currently tracking 15 threat groups targeting industrial infrastructure. Of these groups, one has succeeded in breaking into a company that provides services to several energy sites. This group is now prepositioned in these power sites in a couple of different countries and at locations that could be leveraged to achieve the most disruptive or destructive effects. When state actors are getting into a position to potentially disrupt critical systems where power outages and fuel supply issues are the outcomes, we must be concerned.
Best practices to prevent data breaches While Dragos monitors and tracks the work of several state threat groups, it is the threat groups that we don’t know about yet that are the most dangerous. Of the 15 groups tracked by Dragos, they predict a small number will be enormously disruptive in future years, but the significant danger will come from threat groups not yet known or from hidden parts of known threat groups activity. Tracking well-known groups remains a not-so-adequate protection approach today, especially in the industrial areas targeted by adversaries more dangerous than their past counterparts. Absolute protection requires a continuous assessment of the systems and their vulnerabilities. Rather than being reactive like many companies, it is essential to move to precaution and pre-screening to prevent breaches from succeeding in the first place.
BRAND VIEW
‘Our business has stood the test of time’ Ibrahim Aita, founder and CEO of CMTrading, shares the successful journey of the brokerage since it launched a decade ago, current investment trends and why trust is the key to thriving Tell us how the company was formed. What have been some of the key milestones for the company? Back in 2011, after years of experience in the financial services industry, my former partner, Daniel Kibel, and I decided to establish our own investment firm. We were so confident about our venture that we resigned from our senior positions to launch a roadshow to seek investment to launch the company. However, it was not an easy ride. We couldn’t get the desired funding amount, and things didn’t work out the way we wanted, forcing us to start all over again. We had a strong belief in our plans and what we were doing, so we carried on, betting on our jobs, savings and only $200,000 in funding. This was the foundation of what later became CMTrading in May 2012. The rest is history, the business really took off and we didn’t need any additional funding. We first partnered with a big local firm to provide us with the regulatory umbrella, but they lacked basic knowledge of customer support, which we mastered in time. So we parted ways, knocked them out of the market and conquered the leading brokers in South Africa. We’ve also been involved in contributing to the community. Earlier this year, we sponsored a children’s charity soccer team in South Africa. Ten years later, we’ve evolved into a growing global business operating from Africa to the Middle East. I can proudly say our business has stood the test of time.
We’ve seen a spike in the number of people choosing to trade online. What are some of the key trends driving this increase? The pandemic has shown that relying on a traditional 9-to-5 job isn’t as secure as it used to be. Gone are the days of trading being the sole purview of suit-donning brokers screaming on Wall Street. Today, all you need is access to the internet, a good platform and sufficient training to be an online trader. To be successful, however, you need to partner with a trusted broker such as CMTrading. What are some of the key investment trends that you see based on your clients’ trades? The turmoil in Eastern Europe has sent gold and oil prices climbing to record highs. The tech sector is also making a comeback following a mass sell-off. This year will be marked by shortages in common staples and it’s prudent to diversify your portfolio. Three commodities worth looking into are coffee, cotton and aluminum; all three are at record high prices. However, with volatility comes opportunity and good traders know how to take advantage regardless of how the markets are moving. Trust is a significant element when it comes to trading. How is CMTrading helping build and sustain that trust with its clients? Trust is earned and our 10-year legacy, as well as multiple awards, confirm our efforts
“Trust is earned and our 10-year legacy, as well as multiple awards, confirm our efforts to garner trust. More than 1,000,000 subscribers enjoy our platform”
to garner trust. More than 1,000,000 subscribers enjoy our platform. But don’t just take our word for it – we encourage you to read our great reviews on Trustpilot and Benzinga or watch client testimonials on our YouTube channel. We are always there to help, which creates tight brand loyalty and long-lasting engagement with our customers. Security is a critical component of any online trading platform. How does the company ensure its clients can trade safely? The safety and security of our client funds are our number one priority. We use segregated accounts held at Tier 1 banks. This means that we never have direct access to our funds, they’re kept separate from the company. What are the important factors when it comes to trading CFDs, especially in the current market conditions? Please tell us about the risks and advantages. Contracts for Difference, or CFDs, allow traders to speculate on price movements of financial assets, such as Twitter or Netflix, without owning the asset. CFD traders can profit both when prices are rising or falling. What’s more, by trading on margin, you only need a small amount of capital to open a position. Any trade carries inherent risk, but you can mitigate this through good risk management practices. Note: CFDs are leveraged products. Trading in CFDs carries a high level of risk thus may not be appropriate for all investors. The investment value can both increase and decrease, and the investors may lose all their invested capital. Under no circumstances shall the Company have any liability to any person or entity for any loss or damage in whole or part caused by, resulting from, or relating to any transactions related to CFDs.
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FEATURES / NON-FUNGIBLE TOKENS
CELEBRITIES CAN’T PROMOTE STOCKS, BUT CAN THEY ENDORSE NFTS? BLOOMBERG COLUMNIST MISYRLENA EGKOLFOPOULOU INVESTIGATES
HOLLYWOOD STARS are making a swift march into the NFT (non-fungible tokens) universe as regulators struggle to oversee the space. Hundreds of celebrities from Madonna and Reese Witherspoon to Paris Hilton and Justin Bieber, have bought, endorsed or invested in projects or companies that promote NFTs over the last year – in some cases sending the prices of digital assets soaring. Now, all those Bored Apes, hopeful artists and profit-minded speculators clamouring aboard the Crypto Express are facing larger legal questions on how they promote their involvement in NFTs and whether they need to disclose paid endorsement deals. “Celebrities and social media influencers have a lot of brand power,” says Bob Seeman, a tech and legal adviser and author of the book Bitcoin: Unlicensed Gambling. “But this is a whole new area with NFTs so the regulatory interpretation of it and how the regulators will treat it is unknown.” IS IT LEGAL?
A key legal question is whether digital assets, including NFTs, are securities, and therefore subject to the same rules as stocks. Separately, US Securities and gulfbusiness.com
Exchange Commission rules stipulate that it is unlawful for any person to tout a security, like a stock, without disclosing a financial relationship or ownership to the source. In other words, celebrities that are being compensated would need to disclose their payment. The SEC could determine whether or not NFTs are securities, but the regulator has yet to disclose a case in which they have categorised the assets as such, according to John Reed Stark, former chief of the SEC Office of Internet Enforcement. That doesn’t mean the SEC is not investigating certain NFTs, he adds. NFTs mostly therefore fall under the jurisdiction of the Federal Trade Commission, a civil regulatory organisation that can issue warnings. In an email to Bloomberg News, FTC spokesperson Juliana Gruenwald reinforced that the agency assesses whether someone has not disclosed a paid endorsement deal – especially if it affects how consumers evaluate the endorsement. The NFT market exploded last year, drawing attention for multi-million
dollar sales and buy-in from celebrities. About $44bn worth of crypto was sent to smart contracts on the Ethereum blockchain tied to NFTs during 2021, up from $106m the year before, according to data from Chainalysis. CELEBRITY INVESTORS ON THE RISE
To gauge celebrity interest in NFTs, look no further than the recent funding round announced by crypto-payment company MoonPay, which has focused on the checkout experience of buying and selling NFTs.
ABOUT $44BN
WORTH OF CRYPTO WAS SENT TO SMART CONTRACTS ON THE ETHEREUM BLOCKCHAIN TIED TO NFTS DURING 2021 The company said recently that up to 16 per cent of its $555m initial Series A funding round came from musicians, actors and other personalities. Names include Ashton Kutcher, Bruce Willis, Gal Gadot, Gwyneth Paltrow, Jason May 2022
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The key word of this year will be royalties — the idea that you can take this intellectual property and you can monetise it” Derulo, Mindy Kaling, Shawn Mendes, Matthew McConaughey and Steve Aoki. For MoonPay CEO Ivan Soto-Wright, it’s clear why artists and musicians are so attracted to NFTs: Web3 and the blockchain technology that underpins NFTs have the potential to disrupt how creators and artists manage their royalties without the help of middlemen, he says. Soto-Wright compares this disruption to artists who got into streaming early and benefited as a result. NFTs have the potential to change the way films are made, produced and distributed by allowing film creators to maintain their royalties and bypass Hollywood’s existing order of financing by selling tokens. This system would also allow films to be owned by fans, the NFT owners. “If we have to summarise what are we trying to solve here, it’s ownership. We now have an opportunity to express ownership digitally,” Soto-Wright says. “The key word of this year will be royalties – the idea that you can take this intellectual property and you can monetise it.” REGULATORY COMPLIANCE
Regulators are left to make sense of it all. In March, Bloomberg News reported that attorneys at the SEC had sent subpoenas
demanding information about certain token offerings as part of a larger effort to scrutinise creators of NFTs and crypto exchanges. The inquiry is the latest attempt by SEC Chair Gary Gensler to ensure the crypto market adheres to its regulations. While the SEC has said that many tokens fall under its purview, some crypto enthusiasts argue regulations meant to police the equity markets shouldn’t apply to virtual currencies. “You have a lot of grey area,” Stark says. “It’s a little harder with an NFT to prove that it’s a security and it’s always going to be on a case by case basis.” As more high-profile figures enter the space, questions on whether celebrities are in fact paying in full for their digital goods, or simply promoting collections in exchange for money, have started surfacing. Justin Bieber joined the Bored Ape Yacht Club back in January, after purchasing an NFT from the collection for 500 Ethereum, or $1.5m. Hours before his purchase, another wallet owned by the creators of another NFT collection, inBetweeners, dropped
JUSTIN BIEBER JOINED THE BORED APE YACHT CLUB BACK IN JANUARY, AFTER PURCHASING AN NFT FROM THE COLLECTION FOR
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about 916 Ethereum into Bieber’s – which experts say raised questions about whether Bieber paid for his Ape with money received from an undisclosed endorsement deal. Asked why the 916 Ethereum was transferred to him, a spokesperson at inBetweeners said Bieber was an owner in the project and that the Ethereum represented his proceeds from the “mint,” or the process of publishing NFTs on the blockchain. A representative for Bieber declined to comment.
KIM KARDASHIAN AND FLOYD MAYWEATHER JR. ARE BEING SUED IN A CLASS ACTION LAWSUIT FOR ALLEGATIONS THAT THEY PROMOTED A LITTLE-KNOWN CRYPTOCURRENCY CALLED ETHEREUMMAX Madonna entered the metaverse in March, acquiring a Bored Ape NFT worth more than $500,000. Maverick, the firm run by her manager Guy Oseary, late last year signed Yuga Labs, the parent company of Bored Ape Yacht Club, as a client. That’s not to say that celebrities haven’t found themselves in trouble when promoting crypto projects that left investors with major losses. Kim Kardashian and Floyd Mayweather Jr. are being sued in a class action lawsuit for allegations that they promoted a little-known cryptocurrency called EthereumMax to their millions of followers on social media, artificially inflating its price. A few weeks after Kardashian’s endorsement, the token’s price plunged. gulfbusiness.com
S P E C I A L R E P O RT
HEALTHCARE TRENDS
SPECIAL REPORT
Finger on the pulse BY ZAINAB MANSOOR
As technologies drive the future of most industries, digital solutions are also reshaping the healthcare sector
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here is no understating the fact that digital technologies rose to the occasion across several industries in the wake of the Covid-19 pandemic. Healthcare was no exception. Digital solutions enabled healthcare providers to offer timely and effective interventions to patients worldwide, shredding the myth that quality diagnosis and treatment could not be adequately provided by e-interactions. However, even prior to the global health crisis, digital technologies were complementing operations and services across the length and breadth of the healthcare landscape. Be it patient care and diagnostics, virtual collaboration, remote monitoring or task automation, innovation in healthcare helped reshape wellbeing and showcased how patient care could be effective yet scalable. The manifestation of new solutions to tackle health issues and engage patients via user-centric interfaces has given rise to a new face of healthcare, one that advocates for greater wellbeing. Telehealth broadened the scope of patient care, effectively superseding on-site appointments. Wearable technology prompted remote monitoring by measuring key health metrics for timely intervention. Smart patches are also serving as diagnostic tools, helping monitor vital parameters and administer medication. With growing concern for health, a significant rise in wearables and other wellness devices is also anticipated. According to Deloitte Global, 320 million consumer health and wellness wearable devices will be shipped worldwide in 2022. By 2024, this number is expected to reach nearly 440 million units, including both smartwatches and medicalgrade wearables. With greater intent to monitor health markers and advancing technologies such as 5G and virtual reality, complemented by the increasing sophistication of devices and new and existing players disrupting the space, the adoption of digital healthcare tools and technologies will only escalate. However, healthtech is not limited to patient-related services but goes well beyond that, covering ancillary elements such as electronic patient records, artificial intelligence (AI) for efficiency and clinical support and big data to identify larger health trends. Numbers back the optimism: The e-health market in the Middle East and Africa was valued at $989m in 2019 and is projected to reach $1.8bn in 2024, growing at a compound annual growth rate (CAGR) of 12.8 per cent, according to a Global Ventures report. Meanwhile, MENA is the fastest growing region in the Smart Health and Connected Hospital sector and is expected to be valued at $2.1bn by 2022, it added.
REGIONAL FOCUS The healthcare sector across the GCC has come of age. According to a KPMG report, healthcare-related expenditure
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NUMBERS BACK THE OPTIMISM: THE E-HEALTH MARKET IN THE MIDDLE EAST AND AFRICA WAS VALUED AT
$989m IN 2019
AND IS PROJECTED TO REACH
$1.8bn IN 2024
GROWING AT A COMPOUND ANNUAL GROWTH RATE (CAGR) OF
12.8%
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SPECIAL REPORT in the Gulf grew from $60bn in 2013 to $76bn in investment in October last year. With over 4,500 2019 and is expected to scale to $89bn by 2022. registered doctors, it has helped around 350,000 Alisha Moopen, deputy managing director, users since 2016. Last year, Bahrain-based Aster DM Healthcare states that the patient of healthtech startup Doctori also secured $500k the future wants to be empowered, engaged seed funding. Furthermore, UAE-based doctor and educated about his health. “The dynamic booking platform Okadoc closed its $10m Series nature of health requires every aspect from A round in 2020 and following the launch of its genetic predisposition to sleep scores to bowel telehealth platform the same year, Okadoc has Alisha Moopen, movements to calorie intake to exercise enabled over 75,000 video consultations. deputy managing regime and many other aspects to be seen as Mediclinic also partnered with Okadoc to director, Aster DM different inputs to create the scenarios and care deliver MyMediclinic 24×7, a digital application Healthcare management for optimal health for each person. offering the ability to search available doctors, “As an organisation we are evolving to adopt book virtual and in-person consultations, register a sustainable business model which can make and check-in online, manage appointments healthcare accessible for patients across the world and we and receive reminders. see digital health and technology integration at the core of “By integrating directly with Mediclinic’s EHR, Okadoc this model. The pandemic acted as a catalyst in accelerating reduced clinic no-shows and increased appointment fill our plans and we were one of the first healthcare players rates. In the first eight months, Mediclinic’s no-show rate for in the UAE to introduce telehealth. Within eight months online bookings was consistently lower to bookings made via of its introduction, we had 800 doctors enrolled across five in person or the client engagement centre, representing an countries who provided 100,000 consultations. We also overall 15-20 per cent reduction in no shows,” notes Fodhil launched the E-ICU model wherein critical care experts from Benturquia, CEO and founder at Okadoc. “Further, the digital across operations were pooled into one central hub so that waiting list expedited 15,000 appointments to earlier times, care for our patients doesn’t stop.” equating to Dhs13m in earlier recognised revenue.” The rising demand in digital healthcare services across But the key question remains – will growing demand the region has also drawn significant investor interest, which for digital healthcare continue to prompt greater investor could be attributed to several factors, namely opportunities interest? “This convergence of health and technology has to attend to a burgeoning population, growing consumer unlocked significant potential to improve care and make demand and greater efficiency. it more equitable. This will continue to attract investors Digital health platform Altibbi announced a $44m Series not only for the financial potential but also for the impact B fund raise earlier this year to accelerate its footprint and that population health can have in social development and expand into online pharmacy and diagnostics to enhance economic growth in the region,” notes Abraham Calvo, AI-based health services. Meanwhile, Saudi-based telehealth partner, Healthcare practice at Kearney Middle East. “With startup Cura announced the closing of a SAR15m Series A more and more evidence that technology can help address
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DIGITAL HEALTH PLATFORM ALTIBBI ANNOUNCED A
$44M SERIES B FUND RAISE EARLIER THIS YEAR TO ACCELERATE ITS FOOTPRINT AND EXPAND INTO ONLINE PHARMACY AND DIAGNOSTICS TO ENHANCE AI-BASED HEALTH SERVICES
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75,000+
VIDEO CONSULTATIONS CARRIED OUT BY OKADOC’S TELEHEALTH PLATFORM
SINCE 2020
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SPECIAL REPORT
As we move into a more digitised world, teleconsultation will become the new normal thus widening the access to care. Digitalisation, blockchain and ‘Big Data’ are growing in prominence and artificial intelligence will be the engine that will drive improvements across the healthcare spectrum” big challenges such as access constraints, growing chronic conditions and high costs, investors continue to see in BECKONING THE FUTURE healthcare a sector with growing potential. “We are also seeing a refreshed interest from sovereign Future healthcare systems, bolstered by digital technologies, wealth funds that, in line with the global influx of capital into are expected to broaden the reach of patient care – one that is digital health, are increasing the share of health investments accessible, scalable and equitable – and promote prevention within their portfolios to drive the envisioned transformations rather than cure. More so, digital technologies will also work in of healthcare systems across our region.” tandem to promote sustainability and reduce the Besides standalone companies raking in industry’s environmental footprint. According considerable investment, regional governments to a study published in The Lancet, healthcare and public-private partnerships are also playing a causes global environmental impacts that range huge role in adopting technological advancements between 1 per cent and 5 per cent of total global for greater human benefit. The UAE’s Ministry of impact. By instilling virtual care in the form of Health and Prevention launched a digital health telehealth or shifting gears from resource-heavy AI-powered platform project to stem the spread clinical environments to networked settings, of communicable diseases based on the data of digitalisation will not only stem environmental international organisations. Last year, the Saudi degradation but also encourage the effective Data and Artificial Intelligence Authority and distribution of resources. Philips partnered to drive the use of AI in the “As we move into a more digitised world, kingdom’s healthcare system. In early 2022, Abraham Calvo, teleconsultation will become the new normal Dubai-based entrepreneur Faisal Belhoul and partner, Healthcare thus widening the access to care. Digitalisation, iGan Partners, Canadian healthcare technology practice at Kearney blockchain and ‘Big Data’ are growing in investors, also partnered to launch a $250m Middle East prominence and artificial intelligence will be the regional fund, which would focus on investing in engine that will drive improvements across the AI/cloud-enhanced medical devices and digital healthcare spectrum. In the decade to come, we health technologies. shall witness a paradigm shift in the healthcare system not Aster DM Healthcare’s Moopen adds: “We have also entered only in terms of care but also in costs – thanks to every evolving into partnerships with leading global companies like Siemens digital technology,” notes Moopen. “The apt application and Novartis to further integrate data analytics, scientific of algorithms will give us deep insights into diagnostics, platforms and technologies into our operations with an aim treatment practices, and patient outcomes. Wearable devices to further strengthen treatment outcomes for patients in the could potentially play a bigger role in detecting any potential UAE and beyond.”
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SPECIAL REPORT health threats and diseases and provide patients cent). Healthcare leaders also expect to invest in with the necessary treatment on time while AI three years from now to integrate diagnostics remote patient monitoring and virtual care will (32 per cent), predict outcomes (30 per cent), help us widen the care.” and for clinical decision support (24 per cent),” According to Philips’ Future Health Index 2021 the report - which reviewed the responses of report, healthcare leaders appear to be taking a almost 3,000 healthcare leaders – stated. three-step approach to digital transformation Benturquia adds: “Today, many GCC countries Fodhil Benturquia, investment in telehealth to bolster care delivery; have set their sustainable development agendas founder and CEO, Okadoc investment in AI as a powerful enabler of to include technology as a key pillar. On top of operational efficiency and improved diagnosis; that, GCC residents have become empowered and strategic partnerships with hospitals or and conditioned to use the power of technology healthcare facilities, technology companies and others. across every aspect of their daily lives – from booking flights “The use of AI in healthcare is currently grounded in to ordering food to using online banking. So, it comes as no administrative tasks. However, as healthcare leaders look surprise that digitalisation across healthcare sector will only to the future, they envision deeper use of the digital health continue to advance. technology. Healthcare leaders are prioritising investment “Healthcare organisations have realised that, in order to in AI to optimise operational efficiency (19 per cent) and deliver high-quality care and improve health and business anticipate doing so even more three years from now (37 per outcomes, now is the time to adapt to this digital revolution. This includes adopting patient-facing digital healthcare such as telehealth and digital booking and administrative tasks HEALTHCARE LEADERS ALSO EXPECT TO such as AI automation and electronic patient records.” INVEST IN AI THREE YEARS FROM NOW From wearables to engaging interfaces to virtual care, technology is driving innovation across healthcare. With key concerns such as the prevalence of chronic diseases, high cost of care and inequitable access on the rise, digital INTEGRATE CLINICAL PREDICT health offerings may just be the answer to bridging the supply DIAGNOSTICS DECISION OUTCOMES demand gap, providing scalable solutions that offer greater SUPPORT care and improved wellbeing.
32%
24%
30%
DIGITAL TRANSFORMATION IN HEALTH INSURANCE Likened to tech bolstering the healthcare industry, emerging technologies within the insurance sector are also reshaping how services are delivered to consumers. Companies are leveraging key technologies to develop efficient business models. According to a Capgemini report, focus areas for health insurers include acquiring technical capabilities; driving behavioural change; advancing ecosystem partnerships; providing sustained care; and transforming member navigation. Additionally, health insurers are leveraging cognitive automation to power emotionally intelligent, real-time interaction with members, it added.
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However, what are the emerging digital trends in the health insurance sector? “Embracing a digital move is a golden opportunity for GCC insurers to get ahead of the competition. In fact, digitalisation is a key trend that will continue to grow and evolve into 2022 and beyond across the globe,” says Neeraj Gupta, CEO, Policybazaar.ae. Gupta adds: “Another major trend that has emerged in the insurance industry is the accelerated adoption of technology. When it comes to enabling insurance buying or selling services – technological offerings like AI, IoT
and digital underwriting are key. These technologies meet the customers’ demands while allowing the insurer to deliver more value instantly. These technologies also provide seamless interactions, greater transparency and personalised services. “Insurers’ focus on customer centricity should increase while providing personalised and tailored products and services. With the advent of digital platforms, mobile apps, and big data, customers now expect to be self-sufficient. They expect an enhanced level of service from the moment they buy a policy right through to the settlement of a claim with greater versatility.”
SPECIAL REPORT
COMMENT
Jerome Droesch, CEO of Cigna MEA and SEA
Employee wellbeing is key Holistic health is no longer just a buzzword and feel-good rhetoric, but a necessity to retain an inspired, engaged workforce
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mployee wellbeing has become a priority for organisations since the start of the Covid pandemic. While dealing with the direct and indirect impact of the pandemic on employees, it has become clear that an effective wellbeing package needs to take a holistic approach to meet and support their needs and demands. The demand for holistic employee wellness programmes has never been greater – in view of the rising concern to address employees’ mental health and burnout issues to providing them with real-time, personalised telehealth services. Encompassing mental, physical, and spiritual health, holistic wellness has evolved as a strong focus area for employees across societies and geographies. The evolution of this landscape means that the employees are increasingly looking to their employers for resources that go beyond the traditional benefit offerings, including how employees consume health and wellness. During the ‘Great Resignation’ phase amidst the pandemic, the importance of health and
ENCOMPASSING MENTAL, PHYSICAL, AND SPIRITUAL HEALTH, HOLISTIC WELLNESS HAS EVOLVED AS A STRONG FOCUS AREA FOR EMPLOYEES ACROSS SOCIETIES AND GEOGRAPHIES” health insurance came into focus for employers to retain their best talent. According to a survey we conducted with USbased health insurance provider, Oscar, 47 per cent of the small business owners felt their companies would lose out on the best workers if they couldn’t offer competitive benefits and 60 per cent said they limited healthcare benefit options because of high costs.
Tailored solutions In view of this, it has become imperative for employers to be abreast of the healthcare and wellbeing benefits being offered to the employees, and to ensure that the solutions are what employees truly need. Companies need to prioritise the work-life balance, by identifying overwork in teams, open channels of communications, and focus on rewarding outcomes and value-addition rather than the working hours. Companies also need to provide overall support – from increased flexibility to empathy, career growth and upskilling opportunities, to remain competitive, besides identifying health insurance plans that meet the needs of the organisation, with telehealth access for employees and tailored wellness programme to cater to the employees. Overall, empathy is critical, and employers need to provide mental health and resilience programmes for employees and managers to get the best results. Employers who stay ahead of this shift and offer the vital healthcare benefits to their employees will earn their loyalty, and ensure a more cohesive, resilient, and engaged workforce.
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SPECIAL REPORT
Taking centre stage globally BY NEESHA SALIAN
The UAE has emerged as one of the world’s leading healthcare hubs and medical tourism destinations – here’s how it got there
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he UAE’s prompt and focused response to restrict the spread of the Covid-19 pandemic and its ensuing successful vaccination programme – over 24.7 million doses have been administered to date – put the country and its healthcare sector in the global spotlight. The UAE is the first Arab nation to manufacture a Covid-19 vaccine. Hayat-Vax is a result of a joint collaboration between Sinopharm and Abu Dhabi-based healthtech company, G42 Healthcare. These initiatives – lauded around the world – were underpinned by the objectives of the UAE Vision 2021 National Agenda: to achieve a worldclass healthcare system that serves the needs of citizens and residents. The UAE is well on its way to achieving this goal; with the public and private sectors working in tandem to fast track it. The UAE’s Dr Shamsheer Vayalil, new Centennial 2071 plan, to position chairman and MD, VPS it as the best country in the world by Healthcare 2071, will also power the country’s healthcare ambitions. Dr Shamsheer Vayalil, chairman and MD, VPS Healthcare, says, “One of the key drivers of transformation to be the best country in the world, is the absolute criticality of having a healthy population with access to the highest standards of healthcare in the world. We all have witnessed how the pandemic placed healthcare at the forefront of human existence.” The UAE’s rapid infrastructural development, strong regulatory framework to protect patients, growing focus on preventive care, advancements in patient care delivery, privatisation and digital transformation will play a key role in this process, as will increased spending from the public and private sector. The UAE government has allocated Dhs4.9bn (8.4 per cent of the total budget) to healthcare and community protection in the federal budget for 2022-2026. Abbas Berdi, director, Deals Strategy, Healthcare & Pharmaceutical at PwC Middle East, says, “Investments in innovation, research, science and technology are key to the UAE’s strategic shift towards knowledge-based economic development. The country’s healthcare sector is a prime example of this. Owing to strategic investment from entities such as ADQ, Mubadala, Abu Dhabi’s Department of Health (DoH), MoHAP and the Dubai Health Authority (DHA) among many others, the UAE has in place the necessary infrastructure on which to develop a tech-enabled healthcare ecosystem across the region. Abbas Berdi, director, “With all parties in the ecosystem working Deals Strategy, together – from regulators, payers, providers, acaHealthcare & demia and investors – we can ensure we deliver Pharmaceutical at quality healthcare to more people at a lower cost, PwC Middle East and most importantly, improve patients’ lives.”
SPECIAL REPORT
24.7m+
THE UAE IS THE FIRST ARAB NATION TO MANUFACTURE A COVID-19 VACCINE
COVID-19 VACCINE DOSES
ADMINISTERED TO DATE IN THE UAE
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SETTING AN EXAMPLE The focus on quality healthcare across public and private medical institutions has helped the UAE claim its place among nations with the most world’s advanced healthcare ecosystems. According to Joint Commission International (JCI), a US organisation that approves healthcare organisations and programmes, the UAE is the first country in the world to have more than 200 accredited health facilities, including hospitals, medical laboratories, specialised centres, primary health centres and home health facilities. The UAE also has the most JCI-accredited hospitals in a single country outside the US, says David Boucher, group head of Service Excellence, Aster DM Healthcare. The UAE’s debut in the World’s Best Hospitals 2022 Index has further acknowledged its profile as a leading global healthcare hub. The index, compiled by Newsweek magazine and Statista, evaluates over 2,200 hospitals from 27 countries around the world. Cleveland Clinic Abu Dhabi, positioned within the top 150 global hospitals, was named the UAE’s best hospital. The list also features other UAE hospitals, including two that are part of Aster DM Healthcare. Cleveland Clinic Abu Dhabi is a part of Mubadala Health, which has been working with best-in-class partners to offer patients in the UAE high-quality care. James Sibley, chief strategy and business development officer of Mubadala Health, says, “We have longstanding successful partnerships with established specialists such as Imperial College London and Cleveland Clinic Foundation. “We are future-focused, partnering with companies that are advancing medicine. One example is our recently announced agreement with BioIntellisense for wearable tech to monitor patients’ vital signs from the comfort of their homes and detect problems as soon as they arise. We also actively work with government entities such as the DoH to support its efforts and understand its priorities as well as academic institutions to develop our home-grown research and innovation capabilities.” Mubadala is focused on offering new treatments closer to home and reducing the need for a patient to travel abroad for treatment. This approach also underpins its strategy for growth. Sibley says, “This growth plan involves investing in two things: firstly, our people; we insist on the James Sibley, chief right values and expertise as well as strategy and business the highest medical accreditation development officer of Mubadala Health standards. Secondly, an investment in new medical technologies, such as advanced diagnostics and cutting-edge technology that detect and treat early chronic and lifestyle diseases. Intervening when a patient is already ill is
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old school. We’re helping pioneer a new approach by identifying and stopping problems before they begin. This benefits the patient and reduces the financial burden on the wider healthcare system.” Companies such as Yas Holding Group (YH) are contributing to the sector’s growth through innovation and acquisitions. In 2021, YH’s healthcare arm, GlobalOne Healthcare Holding, completed investments in, and the acquisition of, five complementary and market-leading healthcare value chain product and solution providers. These include WellPharma Medical Solutions, Gulf Inject, Geltec Healthcare, and more recently, Al Ittihad Drug Store, a leading pharma distribution company. This has established GlobalOne Healthcare Holding as the third-largest medical distributor in the UAE. The company also expanded its strategic holding in Icelandic biopharma company Alvotech, to enhance access to biosimilar medicine in the region. Ashraf Radwan, CEO of GlobalOne Healthcare, shares, “We’ve Ashraf Radwan, CEO of GlobalOne been rapidly expanding our Healthcare business through a substantial investment programme over the last two years. We aim to accelerate our growth through future acquisitions, as well as investments in our existing operations. We will achieve this by continuing to be agile, innovative and progressive in all that we do.” Foreign direct investment (FDI) into the healthcare sector is also rising with 100 per cent foreign ownership. According to Invest Emirates, the sector attracted FDI amounting to $784m between August 2016 and August 2021. The UAE’s growing reputation as an innovation hub is also attracting startups and entrepreneurs from across the world. Investments in areas like telehealth, virtual care, genomics and personalised medicine are testament to this, says Berdi.
SPECIAL REPORT He adds, “The Middle East is increasingly emerghealth outcomes for present and future generaing as an alternative technology hub, attracting tions of UAE citizens, conducting clinical research disruptive startups seeking to make a positive with and for local populations will increase the difference. Within sectors such as healthcare, the plausibility of bringing targeted therapeutics and pandemic set in motion a new trajectory for many treatments to the market.” healthtech startups, particularly those nimble Many governmental and private scientific enough to respond to a world crisis that confused research institutions in the UAE are also involved Ashish Koshy, CEO, and broke traditional public healthcare systems. in medical research such as the Dubai Science G42 Healthcare “The UAE in particular is an ideal home for Park, the Unit of Medical Research of the Departthese healthcare disrupters, having created a culment of Health - Abu Dhabi, the Public Health turally diverse startup ecosystem with a whole Research Centre at NYU Abu Dhabi, Research suite of incentives designed to encourage entrepreneurs to Institute of Medical and Health Sciences at the University of set up base here. Supported by factors such as increased Sharjah, Al Jalila Foundation and Mohammed Bin Rashid Unipublic awareness of digital healthcare, strong health tech versity of Medicine and Health Sciences (MBRU). infrastructure, and mandates to ‘future-proof’ healthcare Al Jalila Foundation recently announced that is establishing delivery, investors are keen to put money into the region’s the UAE’s first robotic biobank in partnership with MBRU and digital healthcare startups.” the DHA. An investment of Dhs17m will go towards building The UAE public and private sector is also investing heavily the facility, which will manage seven million human biologiin clinical research and life sciences through collaborations cal materials – the world’s largest in terms of sample capacity. and partnerships. The Abu Dhabi Investment Authority and Burjeel Medical City (BMC), which has become the first Mubadala Investment Company have significant life sciences’ European Society for Medical Oncology (ESMO) accredited investments in the country and overseas. cancer hospital in the UAE, has been recognised for its work AstraZeneca and G42 Healthcare have collaborated to in cancer research, with 29 papers published in international enhance clinical research and diagnostics frameworks in journals in 2021. the country. AstraZeneca recently launced the Accelerating Change Together (ACT) for Cancer Care coalition, with DoH, G42 Healthcare and other partners. The initiative aims to BANKING ON MEDICAL revolutionise how cancer is being diagnosed and treated for TOURISM better patient outcomes globally. G42 Healthcare has also been leveraging its experience in With the UAE gaining precedence for its world-class healthbig data, cloud computing and its AI platforms to offer medicare ecosystem, so has its popularity with visitors as a cal solutions that are personalised, preventive and predictive. Ashish Koshy, CEO, G42 Healthcare, says, “We have grown significantly in the last two years, building the Omics Centre of Excellence, the region’s largest and most technologically advanced Omics facility that is the backbone for the DoH’s Emirati Genome Program - the world’s most comprehensive population genomics initiative, as well as setting up the region’s first dedicated contract research organisation (IROS) for conducting clinical research with and for local populations. The impact of these on the UAE ecosystem is huge, as it will help build a more robust healthcare system in the country. While interpreting large pools of genetic data via Emirati Genome Program will help us have a better understanding of the human body at a genetic level and help unlock better
Intervening when a patient is already ill is old school. We’re helping pioneer a new approach by identifying and stopping problems before they begin” 53
SPECIAL REPORT medical tourism destination. Medical tourism has grown to become a significant pillar of the UAE’s healthcare strategy. A report by Euromonitor International has forecast that the UAE’s medical tourism revenues will touch Dhs19bn by 2023, particularly with the government enabling its growth. According to KPMG’s Who Cares, Wins UAE healthcare perspectives report, the UAE’s potential as a medical tourism hub is supported by “the wider tourism ecosystem in the country, such as attractions, hotels, entertainment, and the provision of world-class aviation and logistics”. UAE’s growing reputation as one of the world’s leading medical hubs will also continue to play cosmetics’ treatments marketplace enables users a great role in boosting medical tourism. The to discover, learn about and book cosmetic KPMG report states that the factors driving treatments online. This platform is particularly medical tourism include affordability, with costs appealing to an increasing number of tourists who acting as an enabler to motivate people travelare looking to visit the UAE for cosmetic treatling across borders for treatments. High-quality ments or procedures. medical infrastructure and care are also signifiWali says: “We believe in building a trusted cant drivers of medical tourism. community of partners so that, together, we In 2021, the UAE was rated as the best medical can collectively contribute to strengthening the tourism destination in the GCC by the US-based UAE’s position on the global map.” David Boucher, group Medical Tourism Association based on factors In terms of technology, telemedicine has also head of Service such as destination environment, patient experibecome an important aspect of after care for Excellence, Aster DM ence, current levels of medical tourism, and the overseas visitors. Boucher adds, “The Covid Healthcare attractiveness of traditional tourism. On a global pandemic enabled the rapid proliferation of telscale, Dubai was rated sixth among 46 destinations emedicine; Aster has strategically included this – and the first among Arab nations – in the Medical Tourism care channel with our MVT services. To facilitate patient Index 2020-21, with Abu Dhabi claiming the ninth flow to Dubai, we have collaborated with international position. These ratings are testament to the UAE’s growing entities such as insurers, international assistance organistatus as one of the region’s and world’s most attractive medsations, physicians, hospitals and most importantly, the ical tourism destinations. international consumer.” The top specialties for healthcare tourism in the counAnd while technology is transforming interaction with try include cancer treatment, dentistry, fertility procedures, patients, hospitals are also tailoring their offerings to stay dermatology and skincare, and orthopedics. According to ahead of the competition and ensure a safe and smooth patient DHA’s Health Investment Guide 2021, top source regions for journey. Boucher says, “We provide home care services, medical tourism include Russia, CIS countries and the GCC. customisable health packages, comprehensive maternity Aster’s Boucher, says: “In terms of medical value travel packages and special packages for patients with chronic ill(MVT), the UAE, and Dubai in particular, is quickly becomnesses. Additionally, we’ve also taken a deliberate approach ing a sought-after destination for a variety of medical care to appeal to all five human senses. For instance, over the past and surgical procedures. Historically, we know that about few months, Medcare has developed and introduced our 16 million travellers transit our local airports annually and signature fragrance to all our hospitals. The feedback from that 83 per cent of the world’s population is within an eightboth patients, families and visitors has been overwhelmhour flight of Dubai. Given that Dubai now boasts excellent ingly positive. To support our belief in the healing benefits hospital infrastructure, physicians and qualified nurses, we of restorative sleep, our hospitals recently introduced pillow have enabled travellers to consider medical care here, rather menus, allowing patients to control their own comfort. To than simply transiting through our airports.” appeal to their tastes, we have added the availability of difTamer Wali, founder of selfologi, says proactive governferent cuisines for patients.” ment initiatives such as the Dubai Health Experience and These offerings reflect how hospitals in the UAE are pulling the Abu Dhabi Medical Tourism portals were the first-ofout all stops to meet the high expectations of patients visittheir-kinds in the region to offer comprehensive assistance ing the UAE. These visitors not only expect the best-in-class to visitors seeking medical services across an extensive medical care, but also the same level of service excellence that network of private and public hospitals. Selfologi, a digital the country’s hospitality and tourism sectors are known for.
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COMMENT
Michael Bolliger, chief investment officer, Emerging Markets at UBS Global Wealth Management
A safe bet for investors
Against a backdrop of uncertainty and market volatility, healthcare presents investors, particularly those willing to invest in the long-term, with comparatively steady returns
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lobal stock markets have faced increasing volatility in the face of monetary policy tightening and negative sentiment following the crisis in Ukraine. Against this backdrop, commodity costs are rising and the price of brent crude spiked to highs north of $130 per barrel. In response, investors are turning to safe-haven assets such as US Treasuries, the Japanese yen, Swiss franc and gold, all of which have performed well, helping them to limit their exposure to losses. However, while these safe-haven assets may continue to perform well in the near term, they also present a number of drawbacks as a form of protection during the current crisis in Ukraine. For example, with the Swiss franc exposed to the European economy, it could be negatively impacted if energy supplies are interrupted. Longer-duration US treasuries meanwhile do not offer attractive yields, particularly in the face of imminent central bank rate rises. And gold faces headwinds from rising real rates as the Fed tightens and inflation moderates. One smarter way for investors to insulate themselves against current market volatility, in our view, is to build defensive exposure into portfolios. Global healthcare is a particularly attractive sector for two key reasons. First, healthcare costs are expected to rise faster than economy-wide inflation. Second, with average life expectancy on the rise, health-related expenditures make up an increasing portion of total spending. Moreover, thanks to the sector’s high exposure to the US and pharma, the sector benefits from a stronger dollar.
BIG PHARMA AND BIOTECH COMPANIES HAVE SPENT
$44bn ACQUIRING CELL AND GENE THERAPY COMPANIES SINCE 2017
Currently, attractively priced in a lower-growth environment healthcare could subsequently outperform the broader stock market. In our Year Ahead report, we identified that many investors seem to share the same sentiment, with 64 per cent of surveyed investors considering healthcare the second most attractive sector to invest in, just after tech. But with digitalisation only just beginning to take-off across the sector, with uptake driven by the recent Covid-19 pandemic, healthtech is an emerging sector set to transform the entire industry thanks to innovative and disruptive solutions presenting significant opportunities. In particular, technology is set to revolutionise the healthcare industry, with medtech stocks, which offer both defensive characteristics and structural growth exposure, accounting for a third of healthcare market capitalisation. Medical devices can assist in the treatment of many conditions and an increasing number of people aged over 65 will likely use them. The market, which includes Implantable or wearable devices, is said to be worth around $132bn. Other promising health technologies include those focused on driving efficiencies across the sector. As a growing number of healthcare providers recognise this potential, they are looking to technologies such as electronic health records that can help improve patient care while reducing costs by sharing medical information between providers. Other technologies such as the use of artificial intelligence to deliver and improve diagnostics are also gaining popularity. And finally, another area of promise worth mentioning is genetic therapy. It offers the potential for removing defective DNA, which can remove the cause of an illness and restore health. This technology represents a paradigm shift in medical care compared to traditional drug treatment. Big pharma and biotech companies have spent $44bn acquiring cell and gene therapy companies since 2017 with the estimated market potential of current late-stage genetic therapies pipeline standing at $20bn. Against a backdrop of uncertainty and market volatility, healthcare presents investors, particularly those willing to invest in the long-term, with comparatively steady returns. Ongoing population growth, increasing life expectancy and urbanisation, combined with technological advancements, mean that healthcare spending will only increase in the years and decades ahead, making this asset class not only a safe haven, but one of the more interesting opportunities in this area.
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BRAND VIEW
Rebalance, restore and rejuvenate Using a 360-degree approach to health and the healing process, The Kusnacht Practice is reimagining mental, physical and social wellbeing
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Eduardo Greghi
he Covid-19 pandemic has put a lot of things in perspective for us, including the significant value of wellbeing. Wellbeing in the true sense of the word is not just the absence of illness, but an integrated blend of an individual’s physical, mental, emotional and social health. This is the key philosophy that underpins The Kusnacht Practice, one of the world’s leading and most soughtafter luxury treatment centres. Located in Switzerland, on the bank of Lake Zurich and more recently, in Geneva, The Kusnacht Practice
focuses on holistic methods and customised treatment programmes to restore the delicate balance between the body, mind and soul. Eduardo Greghi, CEO and Chairman, The Kusnacht Practice, says: “The concept behind The Kusnacht Practice was initially inspired by psychiatrist and psychoanalyst Dr. Carl Gustav Jung, who lived and worked in Kusnacht over 100 years ago and was instrumental in furthering the field of psychiatry. “The Kusnacht Practice was founded in 2007, and since then, our goal has been to treat the entire spectrum of mental health issues, through a holistic approach. We create “a home away from home” for our clients and are passionate about helping them make sustainable life changes.”
A focus on comfort The centre has a selection of fullyserviced, private villas and penthouses, complemented by scenic views and luxurious interiors, to ensure clients can
heal in a comfortable setting without any interruptions. In 2021, The Kusnacht Practice launched its second centre in Geneva, to address the needs of its growing list of clients from across the world, including the Middle East. Greghi adds, “The Kusnacht Practice has extensive experience in treating clients from the Middle East, and we’ve seen a steady increase year-on-year from clients from the region who’ve heard of our innovative approach to healing and exclusive treatment programmes. Our team speaks 12 languages, including Arabic, and is very understanding of different cultures, which makes our international clients feel at ease and cared for.”
A personalised setting To ensure the utmost discretion, only a limited number of clients are welcomed to The Kusnacht Practice at a time, with each one treated in the privacy of their own residence. A specially formed team of renowned medical experts are put
together for each client, depending on the treatment required and the programme they’ve been advised.
A legacy of excellence The facility’s in-house team, which includes experts in the fields of somatic, psychiatric and orthomolecular medicine, plays a great role in supporting the centre’s high standards of patient care. Dr László Ürögi, Head of Psychiatry, Psychotherapy and Relapse Prevention, says, “As a process-orientated medical centre, we combine Swiss standards of excellence, luxury and cutting edge, innovative technology with world-class medical expertise. “All our treatment modalities are evidence-based. Our internal and external panel of experts is closely involved in enabling an individual’s healing journey, with the right amount of medical care provided through the different treatment stages. Compassion, empathy and sensitivity are equally vital elements of this process.” Depending on the diagnoses, clients receive between six to eight individual sessions a day at their private residence, for a stay lasting six to eight weeks on average. They also have round-the-clock access
to a live-in personal counsellor, nutritionist and private butler. The Kusnacht Practice also offers one of the best and most unique aftercare programmes in the world, which ensures clients continue their journey of recovery Dr László Ürögi following their stay. “Our common aim is to treat the causes of our clients’ disorders, not just their symptoms. This is the only way to achieve long-term improvement of health and stable healing,” says Dr. Ürögi.
Specialised programmes While The Kusnacht Practice specialises in the treatment of depression, trauma, anxiety, dependency and chronic pain management, its general programmes are also very popular. These programmes include biomolecular restoration, also called BIO-R, a highly effective, personalised method for detoxification, weight reduction and anti-ageing. The centre also offers residential leader retreats and family programmes, and a post-Covid recovery treatment. The latter consists of a residential
Our team speaks 12 languages, including Arabic, and is very understanding of different cultures, which makes our international clients feel at ease and cared for”
programme that includes 360-degree medical assessments, ranging from in-depth lab testing and analysis to diagnostics and treatment solutions through a range of specialised therapies, including psychological support. The leader retreat programme is aimed at corporate executives and business leaders, who have huge financial, professional and personal responsibilities that come with managing organisations. Such individuals are prone to stress and other mental and physical challenges. Dr. Ürögi says, “We believe it’s vital to preserve health and to prevent problems before they impact the individual and later, the business. Our team identifies and predicts possible health problems before they unfold, such as burnout, depression, and problems with resilience and energy. Our all-encompassing, nurturing and empathetic approach employs a holistic, 360-degree plan unique to the individual to assist their wellbeing. If essential, “working” time is incorporated into their daily schedule, as our team can provide office facilities within the villa or penthouse. Enjoying family time to energise the mind, body and soul is also encouraged in the personalised family treatment programme at The Kusnacht Practice. The treatment plan is specially designed to welcome relatives to share the same or different medical treatments, depending on each particular objective. These programmes reflect The Kusnacht Practice’s ongoing commitment to enable the overall wellbeing of individuals, which in turn, will contribute to building healthier communities at large.
SPECIAL REPORT
“THE HEALTH AND WELLBEING OF CITIZENS, RESIDENTS AND VISITORS IS ONE OF OUR HIGHEST PRIORITIES. IT IS A DUTY WE ENSURE TO FULFIL AT ALL TIMES AND UNDER ALL CIRCUMSTANCES. WE HAVE HIGHLY-QUALIFIED NATIONAL TALENTS, PARTNERSHIPS WITH LEADING GLOBAL MEDICAL INSTITUTIONS AS WELL AS CLEAR PLANS TO ENSURE ALL MEMBERS OF THE COMMUNITY CAN RECEIVE WORLD-CLASS MEDICAL TREATMENTS”
SHEIKH MOHAMMED BIN RASHID AL MAKTOUM, VICE-PRESIDENT AND PRIME MINISTER OF THE U A E A N D RU L E R O F DU BA I
MAY
Lifestyle
22
The notes of success Cartier has carefully curated its fragrance division into a world-class outfit that is winning in key global markets, especially the Middle East p.66
“We are the only jewellery house to have an in-house perfumer. I work closely with Mathilde and a creative team within our accessory design studio” —
Léa Vignal-Kenedi, managing director for fragrances at Cartier Parfums
gulfbusiness.com
Justin Bieber x Vespa The Canadian pop star teams up with the Italian bike manufacturer for these scooters with options of 50, 125, or 150cc engines
May 2022
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Lifestyle / Horology
TICK, TICK… BOOM THE WATCHES AND WONDERS 2022 MEGA FAIR RECENTLY CONCLUDED IN GENEVA, BUT NOT BEFORE A FEW OF THE WORLD’S BIGGEST BRANDS UNVEILED THEIR NOVELTIES FOR THE YEAR. HERE IS A LOOK AT SOME OF THE FINEST NEW RELEASES BY VARUN GODINHO
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May 2022
gulfbusiness.com
Lifestyle / Horology
ROLEX
Oyster Perpetual GMT Master II Ref. 126720VTNR According to a Morgan Stanley report from earlier this year, Rolex held a near 29 per cent market share in retail sales among Swiss watch brands last year – that’s roughly the combined market share of the next five best-selling brands. Rolex is unassailable and its
latest Oyster Perpetual GMT Master II, with its crown pushed to 9 o’clock, shows you just how spectacularly coveted the watchmaker remains. The 40mm sports Rolex chronometer features a stainless steel case and bidirectional rotatable bezel in a green-and-black configuration, backed by a robust Calibre 3285. Probably 10 per cent of the world’s population is left-handed, though a Rolex will likely remain the keep of only the planet’s very exclusive 1 per cent.
PANERAI
Submersible QuarantaQuattro eSteel PAM01287 Panerai is pushing forward strongly with its agenda of sustainability. Last year, it debuted a concept Submersible eLAB-ID that had nearly 98.6 per cent of its weight made from recycled materials. This year, its new QuarantaQuattro models have 72 grams of its weight made from recycled materials – that is over half of its overall weight of 137 grams. The eSteel logo on the dial points to the use of recycled steel being used in its construction. The P.900 used in this year’s QuarantaQuattro is an automatic winding movement with a three-day power reserve. If the eLAB is anything to go by, the future of the P.900 could well include recycled titanium bridges and jewels too. gulfbusiness.com
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A. LANGE & SÖHNE
Odysseus in titanium
The German watchmaker’s first-ever steel sports watch, the Odysseus, broke cover in 2019 and opened the brand to a segment of enthusiasts who want their timepieces to exude a more relaxed vibe, yet which are finished to the very highest standards of fine watchmaking. In 2020, we got the white gold version, and this year it’s going the distance with its first-ever titanium watch. The grade 5 titanium case (Lange says it’s 43 per cent lighter compared to the steel version from 2019) and is complemented by a new ice blue multilayer dial. The 4Hz L155.1 Datomatic calibre is a thing of beauty viewed through the sapphire caseback and makes this watch limited to 250 pieces all the more appealing.
VACHERON CONSTANTIN
Historiques Ref 222
How do you fittingly celebrate the 45th anniversary of an iconic watch? By looking backwards and forwards at the same time. We’ll explain. The new Ref 222 has the same chief design characteristics that made the 222 from 1977 a smash hit such as the hexagonal-link integrated bracelet, fluted bezel and the Vacheron Constantin Maltese Cross at the bottom right corner of the case. The watch then becomes an utterly modern timepiece when you consider the new automatic Hallmark of Geneva certified-calibre 2455/2 that operates at 28,000vph and has a 40-hour power reserve. The newest 37mm yellow gold triple two shows how to properly birth an icon from an icon.
TAG HEUER
Carrera Plasma Tourbillon Nanograph Think of lab-grown diamonds, as stones with a conscience. There’s never any conflict as to where they were mined from or the means and route it took to reach the retailer. With a clear mind, TAG took Watches and Wonders by storm this year by releasing this piece made up of a total of 10 carats of lab-grown diamonds. They are set into the 44mm sandblasted case, onto the rhodium white gold indexes, can be found on the polycrystalline dial where a number of crystals are grown as a single piece as well as on the crown at 3 o’clock which is crafted from a single diamond. The in-house automatic-winding Heuer 02T movement meanwhile powers the chronograph and a tourbillon, and features a unique carbon hairspring too. 62
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JAEGER-LECOULTRE
Master Grande Tradition Caliber 948 This worldtimer tourbillon is not only a technical juggernaut whose caliber 948 comprises 388 components that combine forces to create high watchmaking theatre, but is one where artistic crafts skills courtesy of its Atelier des Métiers Rares division are on full display. Intricate enamelling is used to replicate the world map, as viewed from the North Pole, which floats above the dial. The outline of the continents is cut from white gold and the timepiece indicates the time across 24 time zones. The Earth and the flying tourbillion quite nearly fly across the circumference of the dial completing a rotation every 24 hours.
IWC
Pilot’s Watch Chronograph 41 Top Gun Ceratanium Titanium is lightweight and ceramic is scratch resistant. IWC has blended the best of both worlds in a complex manufacturing process to end up with a material called Ceratanium. It has been used in the production of the case, pusher and crown of this 41mm piece. Its stealth mode is highlighted by the black dial as well as a darkened crystal on the caseback through which you can glimpse the automatic-winding calibre 69385 that has a 46-hour power reserve and supports a 12-hour chronograph.
MONTBLANC
1858 Iced Sea Automatic Date It’s the first-ever sports diving watch for Montblanc and comes just over a year after Laurent Lecamp took over the watchmaking division at Montblanc from Davide Cerrato. The lacquered dials represent ice formations in the water, and there’s an image of a scuba diver in frigid glacial water bodies on the caseback. As a proper tool watch, it is waterresistant up to 300 metres and conforms to the ISO 6425 norms for diving watches, besides having been subjected to the torturous Montblanc Laboratory 500 Hours test for durability. These pieces are somehow simultaneously ice cool and yet red hot – a Lecamp signature. gulfbusiness.com
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CARTIER
Tank Louis Cartier If a watch design has remained nearly unchanged for over a decade, we’d find it difficult to refer to it as anything other than a truly timeless icon. The Cartier Tank was first introduced in 1917, and it’s changed little in its overall silhouette over the last century. Yet, the latest Tank Louis Cartier is made with definitive 21st century technology not least the electrochemical engraving technique used on the anthracite grey dial and a charming manual-winding 1917MC movement with a 38-hour power reserve. The Tank, like the brand itself, proves that it is possible to age without really ageing.
PATEK PHILIPPE
Ref 5320G
For a brand that was the first to introduce a perpetual calendar in a wristwatch as far back as 1925, Patek Philippe is today among the most pedigreed manufacturers of perpetual calendars. We first got the 5320G back in 2017 and that was offered with a cream lacquer dial. The updated model this year comes in one of the vintage collecting world’s most sought after dial colours: salmon. There’s plenty to gaze at on that salmon horizon including a moonphase, day, date, week, month and leap year indication as well as a day-night display. It’s a piece that already has collectors dizzy and is guaranteed to light up the phone lines at every major auction house in the years to come.
HUBLOT
Big Bang Tourbillon Automatic Purple Sapphire Limited to 50 pieces, this watch is an example of a mastery over the use of sapphire – an incredibly difficult material to work with in watchmaking due to the fact that it can often crack during the production process. Hublot has debuted several hues of sapphire-cased watches before – blue, orange, red, black and yellow. For the first time it has used purple, a tint that it secured by blending aluminium oxide and chrome into the synthetic sapphire. Taking the use of sapphire one step further, Hublot used three sapphire bridges within the HUB6035 manufacture automatic winding tourbillon movement that packs a three-day power reserve. 64
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Lifestyle / Real Estate
Soaring ambitions Nemo Stojanovic, director of leasing and marketing, Central Park Towers, DIFC, Arady Developments, explains why the project located within the Dubai International Financial Centre district is an attractive proposition to its residents and businesses setting up base within the prime location Give us an overview of the Central Park Towers (CPT) project and its USP compared to other developments within DIFC?
We are one of the largest single-owned properties in the DIFC area – certainly the reason why over 120 companies have chosen Central Park Towers as their office Nemo Stojanovic destination. Numerous other reasons include our location at the start of DIFC which allows for the easiest access to and from DIFC; the parking experience for visitors and tenants being the only building in DIFC that is able to offer 3-hours of free visitor parking inside the property. Our single ownership proposition also ensures maximum efficiency, where clients can move to a larger unit with no penalty and also avail of flexibility in leasing terms. Our property has hosted several events over the years including the Gulf Business Awards and Gov Games. Recently, CPT launched a fitted floor office space that also offered 12 months of free rent. What has been the response to it?
We now have a total of five fitted floors within the building, and the latest one comes with its own exclusive terrace where people can get fresh air during their break, which is rare in a high-rise office tower. We have been very successful with leasing and recorded 80 per cent leased space within the first five months from the launch. In the market, there is a demand for fitted spaces, which serve small-medium companies well as most of them prefer flexibility when starting off. They can subsequently easily upgrade the fit out or choose to start in an open plan environment. What are some of the key incentives being offered to residential and retail tenants within CPT?
Our residential building is fully occupied, and I believe the amenities and location are gulfbusiness.com
the biggest reason for this success. On the retail side, we are very happy to be home to over 30 retailers, including ten restaurants. These include Spinneys, Starbucks, British Orchard Nursery, Barry’s Bootcamp, Fogo De Chao and others.
located within the DIFC jurisdiction and will continue to attract many more companies who would like to set up office in Dubai under the DIFC regulations.
What safeguards can your tenants avail when choosing to set up their business in CPT?
With the great progress of the Gate Avenue bridge link connection to Central Park Towers – which will be completed in Q3 2022 – our property will be the last one to connect with Gate Avenue which will bring additional traction in the area.
DIFC has been one of the most popular areas for many in the financial, legal, or investment businesses. We are proud to be
What are some of the expansion and growth plans that CPT has in the pipeline?
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Distilling dreams Léa Vignal-Kenedi, managing director for fragrances at Cartier Parfums, is overseeing the global strategy for fragrances at one of the world’s most iconic jewellery houses BY VARUN GODINHO
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W
ith over two-and-half-decades operating at the highest levels within the fragrance industry, consider Frenchwoman Léa Vignal-Kenedi as one of its foremost powerbrokers. She began her career in the Nineties with Yves Saint Laurent Beauté and it’s where she learnt some of her fundamental guiding principles. “I joined the perfume division of YSL in 1997. At the time, Yves Saint Laurent was alive and very involved in the entire creative process. He was certainly one of the most artistic fashion designers, taking inspiration from the likes of Van Gogh and other great painters. It’s there that I learnt how to connect an artistic side with current culture, and then translate that essentially into a product,” says Vignal-Kenedi. It’s an experience that has proved invaluable in her present role as the managing director for fragrances at Cartier Parfums, where she works as the business brains behind the French company’s global perfume division. She oversees functions including marketing, operational strategies and commercial activations for all its fragrances. At Cartier, Vignal-Kenedi works alongside the legendary nose of the brand, Mathilde Laurent. “We are the only jewellery house to have an in-house perfumer. I work closely with Mathilde and a creative team within our accessory design studio,” explains Vignal-Kenedi.
Léa Vignal-Kenedi, managing director for fragrances at Cartier Parfums
Mathilde Laurent
She notes that the entire process from idea to bottle-on-the-gilded-shelf takes a few years. At Cartier, a brand that traces its roots back to the 1800s and a fragrance division whose history goes back to the Eighties, the maison does not reinvent the wheel each time it debuts a fragrance – another trait she learnt from Yves Saint Laurent. “When he (YSL) thought about a new project, he would first go through the brand’s archives – and that’s exactly what we do at Cartier too. Today, when I start the process of a new fragrance with my team, we start with the history of the brand, and look at the archives of the maison.” She cites the example of La Panthère de Cartier, one of its best-selling collections. “When we decided to relaunch La Panthère – it previously existed in our portfolio – we really had to continue to tell its story, but make the product relevant to the present time. We needed to make the client discover what are the animal notes in perfumery and what is the concept of femininity at gulfbusiness.com
“It’s there that I learnt how to connect an artistic side with current culture, and then translate that essentially into a product” Cartier. And so Mathilde worked around the concept of felinity – feline and floral. That is how the idea for it came about.” It came to market in 2014, but the process to get it out of the door, she explains, took four years. The challenges were on two fronts. Mathilde who was working on the anomeric side of the fragrance was constrained
by the fact that recent regulations prohibited her from using certain natural ingredients that were allowed previously, and so she had to develop synthetic alternatives. On the other hand, Vignal-Kenedi’s role had to find a manufacturer who could execute the bottle design which is sculpted from the inside. The duo persisted and May 2022
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Vignal-Kenedi is confident that the La Panthère will become an enduring legacy fragrance for the brand. Revisiting its archive is something that Cartier did to good effect earlier this year too with another popular men’s fragrance called Déclaration. The brand went back to its original Déclaration from 1998 to debut the Déclaration Haute Fraicheur earlier this year which is a variation on the classic. Vignal-Kenedi leads the global strategy when determining the messaging for worldwide markets and says that China and the US are the fragrance markets that are on the rise. “The European region is still one of the biggest [fragrance markets], but China is really picking up. We’ve been expecting China to become a key player for years. It’s not a surprise that it is happening now, but the rate at which it is happening is surprising, especially within the last two years. China is expected to become either the biggest or the second-biggest fragrance market after the US by 2025,” forecasts Vignal-Kenedi. As she notes, the culture and motivations for buying fragrances is starkly different in the US and China and one of her main tasks is to tap the zeitgeist in each of those two markets. “The fragrance culture in the US comes from the likes of Bath & Bodyworks and so it’s very clean, pure and fresh. In China, clients are looking for more sophisticated and signature fragrances, for singularity and the power of owning a piece of the Maison Cartier.” Apart from the US and China, the market that Vignal-Kenedi knows has tremendous potential is the Middle East. “At the start of my career, I was in charge of the Middle East region for Shiseido, and Jean Paul Gaultier. What strikes me about this region is the ability of our partners here to listen, learn and implement very quickly all the expertise and the knowledge we give them with regards to the execution of the plans,” says Vignal-Kenedi. She says Cartier fragrances have had considerable success in its regional markets including the UAE and Kuwait, though Cartier’s push in Saudi Arabia is poised to grow rapidly. “We’re going to have a very successful year in Saudi. We will expand our network and have pop up fragrance stores [in Saudi] too. Next year, we are planning to present the unidentified scented object experiential concept for Saudi too,” she says about a concept that involves a floating cloud of 68
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100%
OF OUR PILLAR LINES WILL ALSO BE COMPLETELY REFILLABLE AND REUSABLE”
“The European region is still one of the biggest [fragrance markets], but China is really picking up. We’ve been expecting China to become a key player for years” perfume seen in an installation in the Palais de Tokyo in Paris in 2017 and then in the Louvre Abu Dhabi in 2019 months before the pandemic struck. Cartier’s focus on the region also means that special limited-edition versions of its iconic perfumes like La Panthère have been created specifically for the Middle East. Among the key challenges cropping up for Vignal-Kenedi and her team is tackling the issue of sustainability, through the use of ingredients as well as the packaging itself. “With the Rivieres collection, we achieved a formula with plant-based ingredients containing no artificial colours. We wanted to demonstrate that it is possible to create beautiful projects while being responsible. In about 18-20 months, 100 per cent of our pillar lines we make will
also be completely refillable and reusable. The challenge here is to ensure the quality of the bottle is maintained so that you can reuse it as long as you want to.” One of her main battles is currently resisting the noise within the industry that is pushing for the exclusive use of natural ingredients in perfumes – something that she’s clear is an impractical objective. “Synthetic molecules in perfumes will always exist. We need to be true to what perfumery is…and perfumery is chemistry. Chemistry is about making the best with a combination of materials that are synthetic as well as natural. The objective is really to find the right balance between the two,” she offers. Vignal-Kenedi’s strategy for the brand means also looking beyond fragrances themselves and into product diversification strategies – a good example can be found in the Les Nécessaires à Parfum Cartier cases that were introduced in May last year and designed to fit nine Cartier fragrances, including La Panthère, Déclaration, Pasha Edition Noire, Oud & Santal, and Pur Magnolia, among others. With the accessory, as with the idea of reusable bottles too, Cartier is selling not nearly a fragrance that dissipates over a day, but a tangible piece of the maison itself. gulfbusiness.com
MAY
22
The SME Story A dedicated hub for the regional startup and SME ecosystem
INTERVIEW
Accelerating ideas
A real estate fractional ownership model, a revenue-based financing model for e-businesses, and a digital neo banking model for students are on our radar this month Give us a business overview of Stake.
We launched our business in January 2021 and closed our seed round of $4m in June 2021. Since our launch, we have 20,000 users and $10m of assets under management. The current team size is 22 people split between Dubai, Portugal, Azerbaijan, the UK and India. We’re currently based in Dubai, but we will be expanding into international markets very soon. What are some of the challenges you’ve encountered while growing your business? Rami Tabbara, co-founder and co-CEO, Stake
What is the core concept of Stake?
Stake is a digital fractional real estate investment platform. It enables anyone from anywhere in the world to invest in rental properties in Dubai and earn monthly rental income in under three minutes. Stake was built for people who want to invest in rental properties but don’t want to buy a whole home, take on a loan, or deal with the operational headaches. gulfbusiness.com
I would say the biggest challenge we’ve encountered was raising awareness about Stake. With so many fintechs being launched in the region, it becomes more challenging to reach consumers, especially on the B2C side. Your product, messaging, branding and offering needs to be different and louder than others. What steps have you taken to ensure that you are leveraging the latest technology?
Technology is at the core of everything we do. One of the most important partnerships we’ve done is with the MIT Capstone project in building a data ingestion and analytics model that collects historical market data on the residential market
in Dubai dating back more than 10 years to evaluate the quality of potential real estate deals and forecast their returns under varying local and macro future conditions. We worked with two data scientists on incorporating a large feature set of real and engineered descriptors, which will allow the model to forecast and predict price levels down to the specificity of a single building or apartment. This will enable us to scale and automate property acquisition and ensure we are selecting the best properties. What are your growth plans?
We will be expanding into Saudi Arabia in 2022 and Egypt in 2023. We will also be listing properties in London in 2022. We have already launched a new vertical called StakeCasa which is the modern way of buying and owning a second home for 1/10th of the price. We are the first to offer this kind of product in MENA and believe there is huge potential in taking this offering into the popular touristic destinations that most of the MENA travellers go to such as Spain, Greece and France. May 2022
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THIS YEAR, WE RAISED
$1.2m FROM A15, MENA’S LEADING VENTURE CAPITAL FIRM FOR EARLY-STAGE STARTUPS
Give us a business overview of FlapKap.
Ahmad Coucha, co-founder and CEO, FlapKap
What is the USP of FlapKap’s model?
FlapKap is the MENA region’s first company to offer the globally rising revenue-based financing (RBF) model. We provide smart and alternative financing solutions to accelerate the growth of the region’s e-businesses. In a way, we are the locally contextualised version of global pioneers such as Pipe, Clearco and Wayflyer. We help e-businesses realise their growth potential through AI-powered insights guiding our partners when determining the optimum ad spend budget for their growth as well as through alleviating the cash flow crunch associated with growth by giving our clients the option to pay their media to spend at a later point in time as a percentage of their future revenues.
This year, we raised $1.2m in seed funding from A15, MENA’s leading venture capital firm for early-stage startups. Currently, we operate in Egypt, the UAE and Turkey, while working on plans to imminently expand into Saudi Arabia. Since our inception, we have doubled the number of our merchants each month and expect this growth to accelerate. The founding team consists
of four people, all of who have strong and complementary skill sets in digital banking, entrepreneurship, private equity and consulting. What are your forecasts for the growth of e-ecommerce within the MENA region?
In a report that was published by Bain & Company prior to the Covid-19 pandemic, they estimated MENA’s e-commerce market to reach $28.5bn in 2022. Over the course of the pandemic, we have seen a dramatic rise in ordering goods online as well as a sharp increase in the creation of online businesses. As a result, we expect the e-commerce market size to be materially higher than this estimate. FlapKap’s goal is to guide these new online businesses as a growth partner and help them unlock their full potential.
“IN A REPORT THAT WAS PUBLISHED BY BAIN & COMPANY PRIOR TO THE COVID-19 PANDEMIC, THEY ESTIMATED MENA’S E-COMMERCE MARKET TO REACH $28.5BN IN 2022. OVER THE COURSE OF THE PANDEMIC, WE HAVE SEEN A DRAMATIC RISE IN ORDERING GOODS ONLINE AS WELL AS A SHARP INCREASE IN THE CREATION OF ONLINE BUSINESSES”
How did the idea for FlapKap come to you?
In 2011, I co-founded Kijamii, a digital advertising agency which has since grown to become GP&K – one of the biggest independent media networks in the MENA region, with offices in Saudi Arabia, UAE, Egypt, and Lebanon. In late 2021, I took some time off work to pursue a master’s degree in economics at Harvard. This is where my passion for helping SMEs further grew and the seeds of FlapKap were sown. 70
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The SME Story
What are some of the major obstacles you are facing in the growth of your business model?
about your innovative model and the means for customers to best leverage it.
First-mover advantage – in any market – is a double-edged sword. On the one hand, you benefit from acquiring a sizable market share early on and the opportunity to build a strong brand. On the other hand, you must educate the market
What are your expansion plans within the region and beyond?
In the few months where we have been operational, we have learned there is tremendous value to be unlocked for the region’s online businesses. For example,
we have helped some of our clients grow their sales by over 70 per cent in just one month – and when they needed flexible payment terms to sustain this growth, we could quickly accommodate this demand for a competitive fee. Our ambition is to enable thousands of businesses throughout the region to achieve such growth.
Our target audience include not just children and teens, but also parents, the entire education ecosystem and the financial industry. Tell us about your smart money management app.
Simon Wing, co-founder and CEO, Edfundo
What inspired you to set up Edfundo?
The initiative emerged from our passion and goal as teachers to bring financial literacy to our youth, who need to be included in the digital economy. We are from a generation where financial literacy was not taught in schools and even today – due to the lack of lesson plans and teaching tools available to guide educators – it is often overlooked or paid lip service to by schools. However, financial education is vitally important as a foundation for the younger generation to help them navigate life as adults. Andrew Toward, who is Edfundo’s cofounder and COO, and I also realised there was a huge gap in the market to address the needs of unbanked youngsters. We knew we could help plug the gap, particularly as teachers who understand gulfbusiness.com
Andrew Toward, co-founder and COO, Edfundo
how children and teens learn and understand concepts. This led to the creation of Edfundo, a digital neo banking model for kids and teens.
We’ve built the Edfundo app in partnership with the region’s leading banking-as-a-service provider, a tier-one regulated bank in the UAE and Visa. Parents in the UAE can sign up for an Edfundo Parent Wallet and then create an Edfundo Youth Account for their child or children. This comes with a prepaid Visa debit card that can be used in stores and online anywhere in the world where Visa cards are accepted. The Edfundo app is engaging and makes learning about money simple, practical, fun and rewarding – all within a secure environment. Young children and teens can choose to save for a specific goal, and learn the power of saving for their future. Using Edfundo’s flexible parental control feature, parents can upload funds and transfer allowances in an instant, top up their child’s card in a single click, set spending rules, set tasks or chores for their offspring to boost their earnings, decide where their youngsters can spend their money, get real-time notification of their spending, and instantly block or unblock cards at any time. Additionally, our dashboards can track the youngster’s spending and saving. May 2022
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They can also use Edfundo to pay in-store or online with their pre-paid debit card, phone and watch, using Apple Pay TM or Google Pay TM. Tell us about the Edfundo Learning Lab.
“WE CLOSED OUR INITIAL FRIENDS AND FAMILY FUNDING ROUND AT 12.5 PER CENT OVER THE TARGET, WITH THE OFFER RAISING $400,000 IN STRATEGIC INVESTMENT ALSO COMING FROM MEMBERS OF THE UAE’S EDUCATION COMMUNITY, WHO’VE BOUGHT INTO EDFUNDO’S FOUNDATIONAL ETHOS OF PROMOTING FINANCIAL LITERACY AMONG THE YOUNG”
We created the Edfundo Learning Lab, which is a purpose-built learning resource, comprising a mix of face-toface and micro online, free and paid-for educational programmes to promote financial literacy. It is designed to be used at home, online and in the classroom. Parents meanwhile can also participate in online and in-classroom microlearning sessions. Extra subscription-based, step-bystep modules also provide full-family access to the virtual community environment where learning follows a ‘share, show, do’ model, with storytelling content, allowing youngsters to put their learning into practice via the Edfundo smart money management app and pre-paid debit card.
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The Learning Lab’s content is cocurated by a group of multi-national specialists, including a Gen Z Montessori teacher, a fintech and business development expert, a children’s learning author, a former finance executive, and a celebrated NFT artist and former banker. A wide variety of selected content is also freely available via our social media platforms and website. We’ve also launched the Edfundo for Schools initiative. Dubai’s The Aquila
School and more than 20 other schools have joined us to educate youngsters on taking responsibility for their own spending and saving habits. Courses, learning programmes and workbooks that were especially tailored for schools and teachers were rolled out too in March to support the initiative. Tell us about your future plans.
We closed our initial friends and family funding round at 12.5 per cent over the target, with the offer raising $400,000 in strategic investment also coming from members of the UAE’s education community, who’ve bought into Edfundo’s foundational ethos of promoting financial literacy among the young. We are now currently raising our seed round of investment to enable us to scale our technology, bring in key hires and initiate our plans to launch into other geographies in the MENA region.
gulfbusiness.com
The SME Story COMMENT
Nicholas Watson, co-founder and CEO, Udrive
Always on the move How SMEs can leverage emerging opportunities within the on-demand mobility and contactless driving sectors
I
f there’s one thing everyone agrees on in the aftermath of the pandemic, it’s that mobility as we know it has irrevocably changed. The transportation industry had already been disrupted by technology before 2020, with ride-hailing apps allowing commuters to have more control over their movements. However, the pandemic transformed that experience into one of necessity and convenience. Add in the fact that, close to 20 per cent of the global workforce was told to work from home for the foreseeable future in the early months of the pandemic – the overall impact on the transportation sector cannot be understated. According to a report published by Arthur D. Little in 2020, the lockdown reduced overall mobility demand in the US
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by up to 90 per cent, with 40-70 per cent reductions persisting during the recovery period. As people attempt to preserve social distance during journeys, this has been accompanied by increased personal mobility (cycling, walking, vehicles). Before the pandemic, urban mobility demand was expected to expand exponentially, with urbanisation continuing and global demand for passenger mobility in urbanised regions expected to double by 2050 compared to 2010. Research indicates the pandemic had little effect on this growth tendency since the city population continued to expand faster than the overall growth of the global population. That’s where mobility on demand (MoD) and mobility as a service comes into the spotlight. MoD is a new way of travelling
that combines several easily accessible means of transportation to make an individual’s journeys more efficient. MoD is entirely based on technology, enabling people to be better informed of available options and make them more productive with their time. Private firms, public entities, startups, and mobile apps such as ride-hailing apps and car-share providers, which cut out the middlemen and use independent contractors, provide solutions that facilitate MoD today. MoD dispels the myth that the only efficient way to travel anywhere – whether locally or internationally – is to own a vehicle or pay large sums to rent. The ownership trend is quickly giving way to usership or partnership. With a growing number of environmentally concerned young people entering the workforce and a high reliance on digital assets, MoD provides them the satisfaction of reducing their carbon footprint. The sharing economy is all about fractionalisation and digitalisation of assets or services. Every sector is undergoing a digital transformation and re-thinking May 2022
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business and revenue models to engage with more customers regularly. With cars, particularly in the context of car sharing, an ‘illiquid asset’, that is, one that is ordinarily only available to one person is fractionalised through digitalisation into a car that is measured and priced by minute or meter and may be driven by anyone with a license. Additionally, with ride-hailing industries, the expense or requirement of a license is removed because the customer receives the added benefit of a driver for the customer, allowing for even more micromobility access. According to another report by Arthur D. Little, the e-hailing industry is expected to develop at a CAGR between 15 to 28 per cent, resulting in an increased market size of $285bn by 2030. Primary drivers of this growth will be the lower rate of car ownership among millennials and the expected progressive integration of ride-hailing into other solutions, which include car sharing and bike sharing. In a McKinsey survey of the US, UK, Germany, France, Italy, Japan, and China, it was discovered that key factors related to health and hygiene changed how private and business trips were now chosen. The cost of a trip was no longer as important as staying safe from health hazards. While the world shifts from CAPEX to OPEX and from ownership to
“AS AUTOMOBILES BECOME FULLY AUTONOMOUS, CAR SHARING, AND RIDE-HAILING WILL MERGE. CAR SHARING PROVIDERS ARE ALREADY DEVELOPING PRODUCTS TO PREPARE FOR THIS, GIVING THEM MORE OPPORTUNITIES TO SCALE HORIZONTALLY AND VERTICALLY WHILE ALSO PROVIDING AN ALREADY EXPERIENCED CUSTOMER WITH MORE OPTIONS”
In the UAE, the car-sharusership, the ‘Netflix’ genA TRIP FROM ing to passenger car market eration in the GCC is more DEIRA TO EXPO has a penetration rate of 0.05 interested in consumption 2020 USED TO per cent. This is a twelve-fold than long-term acquisition. COST A MINIMUM decrease from Tallinn’s (in As automobiles become OF DHS120, Estonia) 0.64 per cent and fully autonomous, car sharBUT NOW ONLY Moscow’s 0.87 per cent. Noneing, and ride-hailing will COSTS DHS40, theless, the UAE is seen as a merge. Car sharing providers THANKS TO more digitally savvy populace are already developing prodCAR SHARING with higher internet penetraucts to prepare for this, giving tion than most countries. The them more opportunities to UAE has approximately 1,000 scale horizontally and verticar-sharing cars today, while Moscow has cally while also providing an already expe36,000. According to research conducted rienced customer with more options. This by car-sharing companies, the short-term will significantly influence the GCC, where potential is roughly 8,000 vehicles, with a young people who want to live aspirational long-term prospect of over 30,000 vehicles lives are already establishing themselves. over the next five years. Before the sharing economy, people were The potential of the mobility market is unable to engage due to the lack of infraenormous. The key to growth is an ecosysstructure, and the high cost of current tem approach and technology enablement. modes of transportation. A trip from Deira Only a business model based on partnerto Expo 2020 used to cost a minimum of ships and scalability can achieve sustainDhs120, but now only costs Dhs40, thanks able development. to car sharing. And yet, there is still a long People were previously unable to make way to go. trips that could not be completed by walking or cycling due to a lack of a practical mobility alternative. According to European statistics, one car-sharing vehicle replaces 17 cars that would otherwise take up parking spots, waste fuel, and emit carbon. Finally, technology can help streamline an experience, changing the dynamics of the business model and revenue/ cost streams in the process. The question to consider for newcomers to the market is whether they can generate a million dollars from a million customers or ten customers? Which route is the best option if they can do this with ease and with an excellent interface? One option has a lower risk of losing a customer, but the other has a higher revenue loss. The chalAPPROXIMATELY ‘CAR-SHARING’ MOSCOW HAS lenge then is to build a service or platform VEHICLES IN THE that can appeal to customers across the UAE TODAY market while providing five-star services for everyone.
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