Peek inside just about any book, lecture or university course on business development these days and you’re likely to see one particular phrase again and again: start-up. Start-ups are everywhere.
In the 20 or so years since Abdelwadoud al-Kurdi and his brother Obaida started the Kurdi Group real estate development company, starting up has changed. These days, the phrase doesn’t just refer to the first phase of new project. It’s a culture, even a movement, with start-up incubators like Wamda and Gaza Sky Geeks, and start-up platforms like Kickstarter and IndieGoGo.
More people are doing it, too: at the end of 2013 Forbes business magazine reported a new era for start-ups, based in part on statistics from the US-based Kauffman index of entrepreneurial activity.
With more markets shifting from industrial to information economies, it may be easier to start up: for web-based businesses, overhead costs can be limited to computing, rather than the machinery, office space and staffing costs of yore.
But if it’s easier to start-up, is it easier to succeed? And have the rules of business changed as the environment has evolved? Bas News spoke with Abdelwadoud al-Kurdi, the Deputy General Manager of Kurdi Group, about the secrets of his company’s international success.
Although Kurdi Group was founded in 1860 by al-Kurdi’s great-grandfather Seydo, the company today is largely the result of mid-nineties push by Abdelwadoud and his brother Obaida to start a real estate business. Twenty-odd years later, the Amman-based company is worth $500m USD and growing, year on year.
Al-Kurdi admits he and his brother didn’t start with nothing. “We are the descendants of Seydo al-Kurdi,” he says. “He gave us a reputation, and that’s the best infrastructure for doing business in a country that believes in ethics and morality. Word of mouth is the guarantor.”
This guarantor, by the time Abdelwadoud and Obaida founded the company’s real estate business in 1997, was a powerful one. The al-Kurdi name was synonymous with precision, accuracy and quality, al-Kurdi says: “The name is momentum for us.”
Yet when it came to the amount of money they were willing to invest in the new business, the al-Kurdi brothers took the same approach as Silicon Valley’s most modern starter-uppers: they kept things lean.
“When we set off we had very little money in our pockets,” says al-Kurdi. “Obaida had no money and I had 30,000 JOD.” The two used this money to bootstrap their first project, rather than liquidating any assets.
Al-Kurdi admits he is fortunate to have had family property assets to use as back-up, just in case, but he is firm on the need to play a conservative financial hand, during start-up and beyond.
“Kurdi Group has been growing fairly consistently since the start. We weren’t affected by 2008. Thank God, we had a conservative strategy and this paid us back.”
For al-Kurdi, there’s another aspect to the financial lesson: spread the risk. “In Jordan we use about seven banks, acting in consortium, not just one. We’ve done this for 13 years.”
“Fail fast, fail often” is a phrase bandied about in start-up circles and is even the title of a bestselling 2013 business book. The thinking is that it’s better to get an idea to market quickly, because even if it fails, that failure informs the next iteration of the idea, and presumably gets the starter-upper closer to market success. This thinking also informs the Lean Start-Up movement: get a product to market, then iterate.
Yet for al-Kurdi, the idea of going to market before he and his partner felt their idea was 100% ready was all wrong. Part of this could be down to personality: he’s a detail guy, an engineer by trade and a lifelong observer and organiser. Obaida brought the charisma, whereas Abdelwadoud, the business’s administrator, brought order and patience.
Al-Kurdi is adamant that the company’s success – Mecca Mall, Amman’s first modern mall, as well as a host of other developments in Jordan and Shah’ba Mall and Hotel in Aleppo, Syria – is a direct result of the time he and his brother put into refining their concept before they took it to market.
After attending Preston Polytechnic in the UK and working for Jordan’s Royal Scientific Society, where he completed an eight-month field survey as part of his degree, Abdelwadoud set off on a five-year research project to refine the mall concept. He and Obaida visited the Gulf, the West and places in between to check out the competition and learn what worked – and what didn’t.
“All the time we had a field study, statistics, and we did it according to real business set-up. We did feasibility studies, we used the Royal Scientific Society economic group, we prepared for an infrastructure to really withstand what we are going for,” he explains.
This reflects the thinking of one of recent history’s greatest starter-uppers, Steve Jobs, who famously said, “Details matter, it’s worth waiting to get it right.”
But when the brothers opened up an Amman office and took their project to initial investors, they were booed: “It was rejected by all means, by Jordanian business people, even banks. They said the situation in Jordan cannot withstand a shopping mall.”
Al-Kurdi says he was able to move past this because he knew his market – a lesson to starter-uppers in any sector. “Although I was a specialist in machine design, in my research I covered almost all recognizable businesses. Every time I visited with a plant I sat with them for almost three hours,” he said. “I had a very good idea about what was going on in Jordanian industry.”
Knowing the competitive environment or the business ecosystem is one part of the equation, but the other is knowing what the customer wants. Here, al-Kurdi credits his upbringing.
“Our father taught us how to listen, so you can deal with all kinds of people, without causing them aggravations. Make everybody feel happy at the end,” he says. “It’s a kind of philosophy, psychology and ethics.”
Yet when it comes to hiring, al-Kurdi says that despite offering training, high salaries and promotions, the company loses its best managers to jobs abroad.
Mary Kay Ash, the entrepreneur who started Mary Kay cosmetics in the US, famously said, “We treat our people like royalty. If you honor and serve the people who work for you, they will honor and serve you.” Here, the Kurdi Group is still iterating to find the training and reward package that delivers the retention it needs.
Like so many entrepreneurs, al-Kurdi – who rises at five or six, goes to bed around midnight and admits to working “every day” – says he is always refining his offering, constantly iterating to make the business better. “This is what we do, every day in our lives: testing, experimenting, listening, talking.”
Finally, there’s the principle of self-belief, familiar to every starter-upper. As no less an entrepreneur than Steve Jobs put it, “Sometimes life is going to hit you in the head with a brick. Don’t lose faith.”
Al-Kurdi’s convictions are similarly strong. “We came to a principle that you can make any business a success, regardless of how feasible, if you have it inside you. If you want to go about it, you can make it a success.”