Bassim Haidar speaks to the Business Leader podcast about entrepreneurship, leadership, and how to build a business from the ground up
Bassim Haidar recently had an in-depth conversation with Serena Haththotuwa at the Business Leader about his business journey and path to success. In it, Haidar talks about how he maintains motivation, why being afraid of failure is crucial to success, and what the important differences are between entrepreneurs in developed and developing countries.
Listen to the full episode below.
See the full story here.
Bassim also features in the August-September edition of the Business Leader Magazine, which can be found here.
BH ‘Business Leader Podcast’ Transcription
Serena (S): Welcome to the Business Leader Podcast. My name is Serena and today our guest has been involved in venture spanning a variety of industries, including telecoms, fintech, logistics, energy, and now the medicinal cannabis business; but he is best known for founding Channel IT and VAS, now Optasia, a telecoms provider which he founded in Nigeria in 2003.
The company now operates in 19 countries and plays a major role in infrastructure in Africa and the Middle East. Thanks for listening to the podcast! Don’t forget to subscribe, to receive the latest episodes. We’ll love to hear your feedback – email questions at businessleader.co.uk to get in touch.
And now it’s time to welcome Bassim Haidar to the podcast today. Welcome Bassim! It’s a pleasure to have you on the podcast.
Bassim Haidar (BH): Thank you very much. Nice to meet you.
S: Great! So yeah, you have a really interesting story: you’re a Lebanese national, but you were born in Nigeria, and you founded your first business when you were just 20 years old! So, can you tell me a bit about your path and your journey to being in the position that you’re in now as someone who’s founded multiple businesses in a variety of sectors?
BH: Well, the journey was kind of unplanned in a way and turned out to be a success. But the driver was always the need that I found when I went back to Nigeria: basically, after going to Lebanon to study and coming back to Nigeria, I still found that communication was really, really bad still. No one was actually doing anything about creating or finding a solution. Therefore, to give you simple examples, factories in Lagos, which is the commercial state of Nigeria, the hub had a population of about 7 million people at the time with 300,000 telephone lines and people could not communicate! The factories were 50, 60 km outside Lagos, so there was no communication with them. So, I managed to find a solution to connect these factories to the main commercial hub and coming with very little capital – I’m talking about $3,000 when I went to Nigeria. I started with the first little equipment to make it work and proved that it worked. And from there on, obviously it was a success, and I had all the factories coming to me and queuing up basically to have the solution that I brought to the country!
And this went on for about three years with huge success. It was a start of myself from my home to having over a hundred people within three years working for us. And then I knew this would end – that party would not last forever. So, I was thinking of my next venture! And those days back in 2003, 2004, there was no satellite TV on the equator or in West Africa, generally because the satellites were not beaming over that region. And, therefore, it was a challenge to try and find a way to receive a signal and allow people to see content that was very much available in the West, in Europe. And, after a lot of trial working with some engineers and so on, we were able to produce a massive 8m satellite dish that captured a signal, and it took us about six months to get the signal. It was seen by a few people at a trade fair, orders were booked, and from there it was a huge success for us. We had a huge order backlog. And then we got – I remember – a very massive order from a big Japanese company to do 250 units for their camp (they were producing steel). So, all of this just kind of helped me raise my own capital in a way without having to go and borrow from anyone. And then the GSM was starting really to pick up in Nigeria at the time.
But there was a little problem that no one saw: to build a GSM site you needed to have more than 10 or 15 vendors all working together, different equipment, different manufacturers, working for the telco operators to be on site, to actually put a telecom site so that people can communicate. And you can imagine the lack of coordination between 15 different suppliers to get a site!
So, I saw that gap and I decided to be a single integrator where I would be a sort of super vendor: I would buy the equipment from these 15 vendors and I’ll go to the telcos and say, “one stop solution. I’ll deliver the site to you, completely kitted out on the site, and you can just basically erect it and then start your communication.”
And this was a huge boost! I mean, some telecom operators went from building like 20 sites a month to 180 sites a month. So, they were able to reach a rural areas; they were able to reach and provide internet connectivity to places that had never been on the internet before. So, this was a huge achievement, and we continue to do this up till today actually highly, highly, successfully.
And, coming back from the satellite TV business, I tried to do satellite TV on phones. That didn’t go well – that failed. I was ahead of time on this one, but I must admit that the phones were not ready to deal with the massive flow of data required and that didn’t work out after I invested dearly in that business.
So it was a lesson for me! It was a wake-up call to say, “you can be successful in many things, but there will be the one thing that will wake you up.” And this one was a wake-up call. So, I had to be a bit more careful on how I approached new ideas. And then in 2012, I had this idea of providing credit to people that are not credit worthy, considering markets in Africa, Middle East, Latin America, Asia, where there are no credit scores, there is no data on consumers. How do you create the data? The only way to do that was via their phone usage – and people underestimate the amount of data available on your phone. Anything you do, you leave a digital signature, be it from top-ups to browsing, to where you visit, what you buy etc – and this data is super valuable.
This creates a credit score, which allows us to lend money to you by pre-approving you as a borrowing customer. We introduced and built this platform – and, through the mobile networks and the banks to back us up providing the financing, we were able to grow this business. Currently, we lend over $3 billion annually through this platform and we are working actually right now in much more than 19 countries, we have about 560 million customers globally out of which 90 million communicate with us and borrow and interact with our platforms on a monthly basis. So, this is a hugely successful business – we’re planning to do an IPO for it sometime early next year. So, this is on the telco side!
I know you mentioned the medicinal cannabis. This is a business that came from the background where I was thinking, “medicinal cannabis is gonna be something big in the future, but no one is actually understanding how the logistics are gonna work. How do we move the product from country A to country B?” So, I tried to dig into this and look into it and I realized it was super difficult – different regulations, different standards and so on. So, I decided instead to build a medicinal cannabis facility and we chose South Africa simply because of the climate, the cost of land, the availability of farmers, and being African rooted myself (even though I’m Lebanese!). I thought Africa was the place I needed to do this. And I chose South Africa, and we built this facility and we commissioned it about five months ago and basically sold all our production for this year and next year. And now we’re breaking down and building facility two, which is gonna be four times bigger than the current one. So that’s where we are!
S: That’s a really good description of your journey so far. And one thing that I picked up on is that you did mention that you tried to start a TV satellite business, but that was a failure or you weren’t as successful in that as you might have imagined. A lot of our listeners are business leaders who have potentially failed throughout their journey to starting their business. But, how did you deal with that specific failure that you experienced?
BH: I think the biggest lesson for me was you could assume you could think of everything to make a business successful, but the one thing which is right in front of your eyes, and which is the easiest one, is the one that’s gonna make you fail. The one you ignored, or you did not see. And, in this case it was content: when you don’t have the right content or the content providers are charging you a lot of money, it kills your business case. And this is something I underestimated completely. And I underestimated the strength of data requirements on mobile phones at the time to be able to have a good quality experience. Therefore, these two things were very difficult to solve because we were ahead of time. Smartphone penetration wasn’t as big and smartphones were not as powerful as they are today. I’m sure you’ve heard that today there’s more technology in an iPhone than Apollo 11 when they launched it. So, that’ll just tell you how much has transformed! And, when you’re still dealing with the old Nokia handsets and trying to stream onto someone’s phone, the experience wasn’t even good. We tried with the right type of phones, but we underestimated the ability of consumers in these markets to acquire the high-end phones. So that was a lesson that we learned quite hard. It cost us some good money, but I took it as a lesson to say, “well, you know what? You failed in this. It’s fine. Because if you win in everything, maybe the bigger failure will be devastating, but this one wasn’t.”
So what you need to do next time is just to think of any potential parameters that could make you fail. I still use that mantra to this day.
S: Yeah, I think that’s a really good advice to be resilient and take every failure as a lesson to learn for the next time you are planning a business venture.
You also mentioned with your venture in medicinal cannabis, that you needed to understand I guess a gap in the market in the future or what a certain need from consumers was. Do you think that this is the most important thing for a business owner or entrepreneur to think about when starting a business? Is it identifying that need in the future from consumers?
BH: I think the biggest mistake people do is follow a trend and that’s the single biggest mistake anyone does. Never ever, ever follow a trend. I’ve never followed a trend, but what I saw and what I understood is that do not underestimate the power of the consumer and the curiosity of the consumer.
So, when you have a consumer that really wants medicinal cannabis or recreational cannabis, but there’s not enough supply, there’s not enough top-quality product out there – and we really research the market, we hired the best people to do this for us – we realized that demand and need from consumers is what’s going to drive growth because that’s a single most powerful thing.
Once you solve the equation around people wanting your product, where do you get this product from will be the next challenge. And that’s what we did. So, when we realized that clients in Germany, the UK, Australia, and so many other countries are really struggling to find product, what is the future of supply chain here? I thought, “well, I need to build the best facility in the world, and I need to build the best quality product.” We even develop our own intellectual property, our own strains. And what is interesting is that, in medicinal cannabis, there’s actually hardly any CBD in it. And the trick is how do you get to well over 20% THC, which is what really then starts to make an effect on patients. And our product today is treating insomnia, arthritis, Parkinson’s, so many other diseases with no side effects. And this was the key for me: how do we break these barriers around regulations? How do we make sure we create a top, top, top, top-level product that will be in demand? We won’t have to sell it – people will come to us and ask us for it. And this is what was achieved here today! Of course, we had to invest in standards, which are just like basically any medical facility around the world. So be it equivalent to Hoffman Rush facility where they produce certain drugs – this is the standard you have to do. It’s highly, highly, highly regulated, there are general manufacturing practices, IDEU that you have to comply with, very, very difficult to get the licenses because of the complications and the compliance required, but we bypass these barriers. And yeah – it’s amazing that when we started this three years ago, we didn’t expect to sell all our production as soon as we launched the business. And that’s what’s actually happened!
S: So, would you say that needs, or identifying the needs of customers in the future, is a really important thing for businesses?
BH: Absolutely. I mean, if you look at every successful business in the world today, the ideas were there, but it’s the need and the curiosity of the consumer that made that business successful. Be it the iPhone, be it Amazon, any other company I can mention to you today was successful simply because the need was there, and it touched the right buttons – and that’s what drove demand. And once you have this mix of formula and you are able to identify that need, then it makes the business a lot easier: you can sell, generate revenue and you can fix things as you move along. But can you imagine investing and you don’t have the market to sell your products in – what is there to fix? You can’t create a market if it doesn’t exist.
S: Yeah. That’s really interesting – thanks, Bassim. So Optasia offers banking to developing markets and now you have 650 million users across the world! Why is extending financial inclusion to ‘unbank’ developing countries across the world – why is that important to you on a personal level?
BH: So, it’s two things. One is many people have tried to speak and tried to crack what we call financial inclusion. Nothing was done about it. No one was able to crack the formula. How do we get a lady in Bangladesh to borrow $50 – because she needs to buy textiles to sell, to make some money – and pay back? Banks were not interested to do that because the cost of acquisition is incredibly high to give a loan of $50 – the cost of acquisition is about $150. Two – the banks have no idea how to score these customers. Three – the bank is about a 100km away; how much is it gonna cost this person to go to a bank and come back to be able to borrow $50 or $80, or $100 (which is the segment we work in)? So, we decided to crack that. It was a challenge for us.
And the second reason is, if I look at my background and where I started, I didn’t come from a privileged family – I started from basically nowhere. I had to crack the way and the road in front of me to get to where I am today. And opportunities were presented to me maybe at the right time and the right place, call it luck, call it whatever you want, but how about we create an opportunity for people to be able to do something with their lives? This was one of the drivers. And the impact we’ve had on millions of people by providing these loans has just been incredible. Absolutely incredible. And when we decided to go to some of these countries – because I travel to these countries myself – and I speak to the people and asked them, “do you know about this product”? They say, “yeah, absolutely!” I said, “why do you do it?” “Well, it changes my life because it gives me that extra liquidity today to start my business, to start my trade. And then when I make money during the day or the day after, I pay back my loan!” I said, “but will you default?” They say, “no, absolutely not because we want to make sure we pay back so we can have that backup of money whenever we need it, because nowhere else will we be able to get that money.” And it was so exciting to hear this. And this is why we started to expand more and more into many countries. And this has had a really, really positive impact in the West! We think a hundred dollars, “what’s a hundred dollars?”, but we don’t realize that when you have 1.7 billion people that are living on $50 or $60 a month, and you’re able to provide them $50 or $60 loan, that’s a huge impact for them – it really, really does change their lives.
S: That’s really powerful. And another thing Optasia does is accelerate affordable smartphone ownership – how do you think this positively impacts people? Why is that so important?
BH: So let’s put it in perspective: we have so many products we want to try and sell to consumers that we believe are good customers, but they are unable to get onto these products because of a lack of smartphones. If you wanted to classify smartphones in the past, the smartphone used to cost $600; today, you can buy a smartphone for $40 or $50. So we said, “how about not only we look at doing financial inclusion in terms of providing loans and so on, but what if we provide the tool for these customers to be able to get onto the financial system?” And what is a tool? It’s the mobile phone.
So if we’re able to create a technology that allows us to give a mobile phone and allow customers to pay gradually for it, why not? And as a result, we develop a technology that allows us to lock the phone remotely, if payments are missed. So the customer knows in the back of their mind, we’re gonna give you a phone, you’ve got payments to make over 6 months or 12 months for this phone, $5 a month or whatever it is. But, if you miss payments, then your phone is gonna be locked. It’s gonna be actually useless. And people go for it because they want to improve the quality of their lives; they want to check prices of commodities – if they’re a farmer, they can have 4G connectivity instead of 2G etc. So, people are embracing that! And as a result, we’re creating more data on these customers. And when we create more data on these customers, we’re able to lend them money that they haven’t been able to borrow just say 6 months or 1 year before. So that’s why we started to do this. And that’s why it started to impact their lives positively.
S: Do you think that there’s a difference between the way the Western world and developing countries welcome technology into their lives or their society?
BH: I think in the West, we take technology for granted. I think in developing world it is a daily need; it’s a daily human right; It’s a daily requirement in order to survive – so it’s not taken for granted. The mobile phone in the West is your life, but, in terms of social media and unnecessary stuff, if you think about it, how many people do banking today through their mobile phones? That’s increasing of course, in the developed world, but you can also do your banking over your laptop, you can go walk to a branch – there are so many ways you can do it. In emerging markets it’s not that easy without a phone, without a secure connection, without good connectivity, without a bank that is willing to bank you because of the small income that you generate, your phone is your life. And your phone is your collateral in a way. So when we give you a handset as a loan, it’s our collateral because we know you’re gonna protect it because it’s your way to be able to live a better life, a better experience, maybe share videos with your kids that don’t have these phones etc. So it’s a very different view.
And I’m actually grateful that I was able to see this first hand in emerging markets because I understand if I was born in the West and I grew up there, I probably would have no idea about the needs in these emerging markets, the consumers in these emerging markets.
S: I’m just curious to know what impact you think growing up in Nigeria and having the experiences that you had, how do you think that’s made you the person that you are? But also impacted the way that you look at the world?
BH: I think if I put it in an example – I think growing up in Nigeria is equivalent to Harvard in a different way! you learn first-hand in a very, very tough environment how to do business – really, really first-hand. You’ve got to look at all the parameters to make sure something becomes very successful because when you have infrastructure and regulations supporting, you can use your education and your skills to build on that regulation, to try and build a business. When you’re in a country where regulations are weak, where the environment does not support you, where the laws are weak, where there’s a high level of corruption, you need to be very careful, and you need to think very differently.
Your mindset is not the same mindset that you’d have in the Western world. And I think this was something that gets embedded in you from childhood to be super careful and alert, but yet not underestimate the opportunity being presented to you. I mean, I’m lucky and grateful to be able to have seen this because growing up there and realizing how far behind we were to the West and I thought, “but why?” And I think it’s just a matter of timing. We’re just behind in time. We are 30 years or 20 years behind, but in 20 years or 30 years, we’re gonna be what the West is today. So why not start building on that? And this is the thinking that drove me because I knew this is where we’re going to get to.
And then outside Nigeria – it wasn’t only about Nigeria – I mean, we started to go to, Ghana, Cameroon, Côte d’Ivoire, South Africa, Kenya, all these countries, then North Africa, Middle East Asia. It was the same common thing all along different cultures, but the problems were actually exactly the same! But the big difference is people did embrace technology a lot, lot, lot more in these markets. And I think that was a good driver for us.
S: Do you think that entrepreneurship is something that you are born with and entrepreneurs are born with that ambition and drive? Or do you think it’s something that can be learned?
BH: The real, real successful entrepreneurs are the ones that are born entrepreneurs. You cannot teach this really is what I’ve seen. You cannot teach this to anyone else. You know, I’ve got three daughters and I’ll tell you one thing. I can see the one that is gonna be an entrepreneur. And I can see the one that’s gonna be a lawyer. And I can see the one that is sort of a little bit of each but doesn’t really know where she stands. And I’m an entrepreneur myself!
So, can I make them entrepreneurs? No, I cannot. Can I force them to be in one of my businesses and run this and run that? No, absolutely not. It’s either you have it or you don’t have it. And I’ve seen many, many families hand over businesses to their sons because they believe they’re entrepreneurs and by default their sons and daughters are gonna be entrepreneurs. And I can tell you 80% of the time that doesn’t go well – that family wealth disappears on the second generation because of a lack of entrepreneurship. Succession planning is critical when it comes to well-developed businesses. It doesn’t have to be family members – it doesn’t have to be that at all. It has to be people that can continue the mission of the business.
Now, of course you have more resources in the West, but you also have far less opportunities than you have in emerging markets! So, what will you use those resources for? Well, if the opportunity is not there, I’m not sure how much you can use that. When you think about it deeply, look at the level of education in Europe and so on – why haven’t there been any highly, highly successful tech companies or highly, highly successful global companies coming out of Europe in the last 10 years? I can name very little – I can name a company like Klarna and Sweden and so on. But realistically, when you look in the US, it’s because the US is geared for entrepreneurs!
You know, entrepreneurs are becoming a trend there. The environment supports them, creates the opportunities for them and so on. And someone has to think, “yes, the opportunities are the same in the US as they are in Europe. But we are pushed down by all these regulations by all these laws that actually suppress the entrepreneurial spirit in Europe.”
This hasn’t happened yet in emerging markets. There’s a lot of opportunity, a lot of entrepreneurs, but what drives an entrepreneur? This is what we never speak about. It’s hunger! It’s a fear of failure! In the West, people are comfortable. You fail – that’s fine. There’s a government to look after you.
You fail. Okay, you live with your family. You’ll fail – you’re not gonna starve. In the emerging markets, you don’t have that backup. You fail – you’re going to starve. There’s no support system that just tells you, “well, if you fail in this, try this and try that.” It doesn’t work like that. So, that in itself creates entrepreneurs. And this is why you see today, for example, technology companies coming out of Nigeria and Kenya. Extremely, extremely successful companies built by entrepreneurs that just had the right education, came back to their countries, and started businesses in an environment that enabled them to put resources, to put knowledge, market knowledge, into practice and become very successful companies.
S: One thing I picked up on is that fear of failure. Often entrepreneurs are told again and again to not be so afraid of failing, because it’s a natural part of the process. But would you say that fear of failure is a universal defining characteristic of entrepreneurs?
BH: We should not mix both things because I believe that fear of failure is the single biggest driver for an entrepreneur. When you are afraid to fail, you are gonna put not your best, but your absolute best to be successful. If you are thinking, “well, if I fail, I’ll try again”, you’ve already set yourself for failure in a way, because you’ve allowed that 10, 20, 30% chance for failure to happen. People ask me, but you always have a plan B. I said, “no, I only work on plan A because the moment I think about my plan B, I have already discredited my plan A; so why can’t I perfect my plan A in the first place so that I don’t need the plan B?” This is very important. And I think this is something we really need to embrace very strongly. Forget about plan B; only focus on plan A. The fear of failure is gonna drive you to deliver plan A because you’ve not created another choice for you in case plan A fails. And for me, I know people ask me, “oh, you must have been very confident”. Then I was absolutely not confident! I was terrified to fail, and this is what drove me more than anything else. I was not prepared to fail.
S: Something that’s come up quite a bit in the podcast and also is a bit of a buzzword at the moment in the West is this idea of imposter syndrome. And I’m just wondering if that’s something that is maybe existing in the West, as a part of this sort of privilege, or if this is something that is also spoken about in the developing world at all?
BH: You know, the interesting thing is that I haven’t heard anything in the emerging markets – and we spend a lot of time there – of people talking about, mental health, stress, imposter syndrome, depression – people don’t have time for this. We don’t have time for this! People want to live, people want to move on, people want to build things! Maybe it exists, but they don’t think about it because how is that gonna help them and where will they go for help?
The only thing they can do is help themselves is to build their lives, is to move on, is to think about their kids’ education. That’s what people are thinking. I think in the West, we’re spending too much time today thinking about issues that we create – and then it becomes a trend. And then we start to believe in these trends so much that we stop moving forward.
And then where do we end? We end up with people self-diagnosing themselves because it’s easy for them to say, “you know what? I can’t continue on this journey. It’s too difficult for me. Okay, I’m just gonna…maybe I’ve been diagnosed with A, B, C, D, and E. My mental health is not in a state where I can do this and that” – this is becoming a serious problem in the West. But I can tell you that I’m not saying it doesn’t exist, but I’m saying from my experience, I’ve not heard any of this come up in any of the emerging markets.
I can tell you we operate in different businesses in more than 40 of these markets. And it’s not something we come across because I think people have bigger problems that they need to deal with. People need to think about their food daily, people need to think about their kids’ health and kids’ education and so on. They don’t have time to self-diagnose.
And I think in the West we live with two great standards and so on, but as humans, we should start believing more in ourselves, we should start thinking, “what can we do more with our lives?” Life is not easy: it’s going to throw a lot of bad things on you all the time. It doesn’t mean you’re just gonna give up because it throws bad things on you because you had a good life and all of a sudden something goes bad. You should learn from that and try and move forward.
S: That’s an interesting perspective. I think it’s good to have that perspective to realise the differences between people’s priorities as businesspeople and people in general across the globe. And I think the types of issues that impact people’s mental health across the world are just very different! The types of challenges that people face day to day, like, for example, social media in Western countries is a leading cause of mental health issues, which maybe people wouldn’t have really imagined – and isn’t so much the case in developing countries. Whereas, you know, not being able to buy basic necessities is something that would lead to poor mental health in those countries potentially.
BH: Absolutely. Especially with the generation I’m talking about, you know, 8, 9-year-olds till their teens and up to even their twenties and so on. Everyone wants to now become an influencer or a star. I mean 20 years ago – and it didn’t exist 15 years ago! – it didn’t exist. Who thought about being an influencer and trying to make money off YouTube or whatever, whatever? Yeah, okay, there are some successful ones and some good ones etc, but it seems everybody now wants to become this! How much more influencers can there be? How much more junk from social media are people gonna be absorbing and how can you apply that in the real life? What kind of lessons are we learning from this that we can apply in the real life?
None, basically. Really zero! And this is creating mental health issues. I’ve got three daughters and I’m very, very concerned all the time because they do spend a significant amount of time on social media. But then the question I’m telling them is, “what are you learning out of this, wasting hours every day just watching this star, do this and do that, and this person jumping off this with a challenge? how is that gonna help you in the real day-to-day life? You think you can apply any of these things in your day-to-day tomorrow? No, you won’t be able to apply this and, therefore, they’re getting influenced and spending a lot of their valuable lives – instead of learning something – being influenced by silly things, and then feeling incapable of doing them and therefore having all these issues with mental health.
And I think that’s less relevant in the emerging markets because people have less time on their hands. People walk to school, they don’t have connectivity walking to school, and they can’t afford a smartphone where they can be on social media; whereby kids are being driven to school today or on a bus, on a train, and they have full connectivity and they spend that half an hour even before they get to school already watching social media and already being influenced by it.
And I’m not saying in the emerging markets, it’s not gonna happen. I think it will happen in the future in 20 years from now. Definitely it will happen. And then maybe the issues of mental health will start also. But right now, it’s very different and I don’t know what can be done about this – I don’t think we can regulate all of these social media companies.
What is true? What is wrong? What is allowed to be seen? What is not allowed? It’s a very difficult subject!
S: It is definitely a very difficult subject with a lot of different aspects to it, but that’s really interesting to hear your perspective on it. A lot of entrepreneurs would consider your story to be aspirational, but also, you know, they would think that you have sort of ‘made it’, but I’m just wondering if you feel that way? How do you maintain your motivation to kind of keep going, even though by certain standards you would have been considered to have reached the success?
BH: You know, I don’t feel I’ve achieved anything is the truth. I feel that I’ve achieved something, but there’s still a long way for me to go and don’t get me wrong and I’m not gonna be philosophical about this…a lot of people say, “oh, it’s not about the money!” and all of that. Right now, for me, honestly, it’s still about the money, but it’s not everything about the money like it used to be, but it’s more about creating things that are impactful – things that maybe someone hasn’t done before. And that’s what excites me!
I’m super excited about my medicinal cannabis business – super, super excited. And that’s because I’m learning all the time and because I believe this is gonna be huge. In the next five years, I have zero doubt about this, and I can already see the trend. We just participated at the Cannabis Europa conference in London, and we could see the biggest distributors in the world coming to us, trying to sign deals with us for future supply chains because there’s not enough top-quality medicinal cannabis today in the world! And if we could lead in that sector and become the number one player in the world, that’s what drives me. The money will come – that becomes a natural thing obviously. So, of course, money is a huge driver in an early stage of an entrepreneur, but it’s not the driver for me right now. It’s still very important, but it’s not the driver for me.
S: And do you have moments where you feel less confidence, or you feel like you lose a sense of purpose in any way? And, if you do, how do you deal with those moments?
BH: Totally! I mean, we all lose a sense of purpose. Sometimes we question ourselves, but I think that’s just human nature! You need to question yourself all the time, whether you’re doing the right thing, whether you really need to stop this now, if it is time to take a break and so on. And then you get the shivers and say, “no, no, no, no, no, no, no, no, no, no way. I’m not gonna stop now. No, no. Now I’m gonna even move a bit more!” So, if your mind plays on you, because it goes from fear of failure to fear of losing what you have – and that’s a different level of fear altogether – it sounds a bit strange, but that’s just the way it works. You’ve built many successful businesses. Are you gonna do a mistake that’s gonna cost you? So you become a bit more careful, but I do not want to lose the entrepreneurial part, I do not want to lose the creativity part, I do not want to lose the ability to start new businesses, invest in new businesses, acquire new businesses if it needs be – I think because it just keeps me going, you know, it’s just something that I enjoy doing!
And I think the most important thing for me was the challenge of removing myself from the operational day-to-day aspects of my businesses and trusting people to run my businesses. And I think this is, I would say one of the biggest challenges that I had – and I started to work on this about 13 or 14 years ago. And thankfully I’ve got some of the most amazing people working for me, which allows me time to think about other things, to think about personal things that I want to do, some philanthropic things I want to do etc, yet still managing to grow the businesses and think of new ideas. And I think that’s kind of a next stage in an entrepreneur’s life – to be able to achieve.
S: And when it comes to stress and dealing with stress, are there certain things that you do to wind down? Are you so busy that you don’t really get to have too much space to yourself? Or what do you do to tackle that?
BH: Definitely I’ve created free time for myself, but I started to think differently about stress. Stress is also a driver for success! People should not underestimate the power of stress. In many ways, I learned that stress could be a good, powerful driver, but also, I also learned one very important thing – I’m thinking I stressed about it yesterday and I’m here today. And then what should I do now? Should I stress about tomorrow? And then when tomorrow comes and I say, “why did I stress about it?” So you need to manage stress in different ways. Of course, I’ve had more time to do certain hobbies that I’ve always wanted to do, but I think it’s not to manage stress. It is just because I believe I need to live life a little bit and I want to enjoy my life after working for 29 years – I think it’s normal that I do these things.
S: That’s really interesting, hearing about managing stress in a more incremental way and putting it into perspective, I suppose. Now you’ve also founded your own venture capital firm, Knuru Capital. A lot of our listeners will be very interested in hearing about how they can best prepare themselves and get themselves to a point where they’re achieving the investment that they want. What advice would you give to business owners about achieving in investment?
BH: So there there’s really two things here. Why I started Knuru Capital. One: I wanted to help entrepreneurs, raise money for businesses where it was too big for the very big venture capitals to look at – these guys, they want to put a check of 20, 30, 40, 50 million. It wasn’t interesting for them. But also it wasn’t really seed capital angel investors with few hundred thousand. So it wasn’t the segment I was looking at. What we realized is that there is a segment where funding is required between the $3 and 5 million mark. And this area here was completely ignored by many international investors. These are extremely good businesses. These are amazing, amazing entrepreneurs, but they just lacked the backing.
So that’s one of the reasons we decided to target that segment. But the other thing that we said – we would not invest in a business whereby the entrepreneur is looking to start this business and is already thinking about an exit. That’s a no-go for us. When you start a business, you got to focus on the business. You have to not think about the exit. This is becoming a huge problem. Now we see that everyone starting a business after one year is already thinking about the exit. When I started my businesses, I was thinking about an exit 10, 12 years later when the business was super well established and so on. But that’s only because it shows you’ve invested your time, blood, sweat effort into this business to make it what it is. Then of course, it’s nice to cash out at the time. So, we try and train these entrepreneurs when we invest and say, “do not think about an exit – focus on the potential of the business. We see the potential in this business. We like it. We’re gonna invest. We’re gonna back you up. We’re gonna support you, not only financially, but we’re gonna open up many areas for you – simply because of what we’ve learned over the years, because of our relationships” and so on. We only invest in businesses that we fully understand. No matter how exciting something else sounds, if we don’t understand it, we’re not gonna put any money into it because we can’t add value to that. And this is what really we’re using today: as a tool to grow these businesses, invest in them. Some businesses we’ve invested twice, three times so far in different funding grounds, simply because they are following the advice, we’re helping them open up markets where they did not expect to open up these markets, simply because we are in so many countries ourselves. It didn’t come from other people’s money. It didn’t come from us sitting in one location and looking “where can we invest?” No – it came with a very clear focus to say, we understand emerging markets, we are only going to invest in emerging markets, and we’re only gonna invest in companies where we believe we can push and create value. And, as I am the only sponsor of this venture capital, we’re very careful about how we put our money into these companies. We’ve not raised any money from anywhere else: we’ve put in our own money 100%, but then we are from October going to raise a second fund and that fund is gonna have institutional investors and external investors. And that’ll be focusing on different sectors we believe are still also being ignored, but with slightly bigger ticket sizes.
S: Yeah, it’s interesting, hearing about investment from the perspective of an investor. That’s really interesting advice and an interesting perspective!
Unfortunately, we’re coming to the end of our podcast, but with every episode we always finish with a segment called ‘Answer the Internet’. This is where we scowl the internet for the questions that the public needs answers to. And the question will put to you today is from @jollytrumper111 and they ask, how do you become a billionaire with $5 million?
BH: Well, if you can become a multimillionaire and a billionaire from $3,000 or $4,000, $5 million is a lot of money! I mean, it’s a lot of money to start a business! I think what you need to do is remain hungry. What you need to do is to make sure you start something where there is a need for it. Don’t follow the trend. There must be the need – it must be something unique, something where you are in the lead few years ahead before anyone else can catch up with you. You have to have the intellectual property of whatever you want to do. Leave your passion aside – your passion isn’t going to help you. Your passion is going to bring you down. Be hungry, be afraid to fail and I think you will make it.
S: That’s a really great answer to that. And then we are Business Leader Magazine; so, my next question is what makes a great business leader in your perspective?
BH: I don’t think there’s one thing that makes a great business leader – I think it’s many things combined. One of the things that I felt was very important is people trusting me: you need to create trust – people need to believe in you. Everyone is looking to a leader, and, when people believe in you, believe in your mission, believe in your vision, you are a fair person, you’re willing to take the people on the journey along with you, you are not shy to get your hands dirty and work at the little level or the high level of the company and be part of the teams you’re working with. Do not sit up in the castle and let the people work down – you need to be down at the same level with them. Apply that vision and make it a mission, but always let your people challenge you! The day you stop letting your people challenge you is the day you’re gonna lose them.
And I think it’s critical, critical, critical that you listen. You’re the leader – you made the final call, but at least you must give the opportunity to the people with you to present their ideas and challenge you in a strong way before you make that final call. And I think this is a combination of things that everyone needs to carry along with them always as a leader.
S: I think our listeners will find that really interesting and useful advice. Thanks for that, Bassim. And then finally, do you have any final words for the audience?
BH: Well, all I can do is hope that some of the things I said today will inspire people to think differently. There’s nothing wrong with changing the way you think. I think you can always think better. Usually what I notice is people get motivated for a little bit and then they lose their motivation; but I think listening to something over and over again will eventually embed and, eventually, you’ll believe, and, eventually, it’ll become part of your daily routine. And I think this is important – listen to different podcasts, listen to different views and try and make your own judgment!
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