Is it wrong? [42], Uber and Careem faced heavy criticism in Egypt at the beginning of 2016 by local taxi drivers for operating without official taxi licenses. : So by going through that exercise of putting these down, you started building conviction. You know, if you create the right operating system then individuals take the initiative and so they have to deal with the startup phase and all of the two year cycle and all of that. So we were giving people feedback. You can do it. Many of our customers will value it for long haul routes. Its Karachi should do something, Lahore should do something and the people that are running those cities need to be empowered to do those things. Well win by running faster than them so if an opportunity comes up, something changes the market, were able to run and make something happen. : So what does your day look like? : Yeah. What ETA do you get? I dont know if you remember, where you said instead of focusing on problems, focus on people. The movement of things as well. Now, when we put that down we of course debated a lot internally. And when that service is provided, it needs to have very clear SLAs. Now, I dont know how long we followed that contract, which was sort of the sad part. : The second type of role that a country or Dubai can play is a service provider. : So if you compared that vision to any existing company, whos the closest analog? The product was able to gain startup funding of USD 1.7 million in 2013 from STC Ventures. : So we just need to now build that operating system, we call it the Careem operating system, thats going to enable us to build this thing and realize the vision. If Qatar's Sheikha Moza is worth $15b, she's undervalued. Well win by having much better people and by having a culture that drives a certain mission and vision type of behavior. Meaning understanding local opportunities and adapting our product to meet those opportunities. Its an output of you doing all the right things, right? Growth is an output. Sheikha and his team did not only focus on providing tech training to these captains. Maybe this thing that were doing will not even materialize. Mudassir shared his journey and ways to boost entrepreneurship in the region. This thing will start putting the right people behind the right rules. I think some of these things are tested locally as well. I need to get responses in this time, Im going to pay this much money. So they say theres seasonality and theres this and that, so I cant do monthly, even. And who knows what happens in six months? Careem will become a wholly-owned subsidiary of Uber, preserving its brand. And so its interesting because you started by saying, you know, we focus on the outputs, the growth, every other thing. . You cannot have the same level of person, quality, systems, all of that, at each local branch. So thats when Magnus and I would have to be a lot more involved in the business. : When you start thinking of this a bit more, the more you think of these things and the more that you discuss these things, you start building more conviction behind them as well. So analytics just as an example. How do you balance these two things? Shikhar Ghosh: Right. Then, do I get rid of this person? Share a story with me, asra@techjuice.pk, India Expects Apple to Triple Investments and Exports Over the Next Few Years, Snapchat Explores Newer Ways to Make Money While Sticking to its Roots, Twitter Goes into Meme Mode as Babar Azam, Virat Kohli, Cristiano Ronaldo Lose Blue Ticks, 10 Ways To Make Money Through Virtual Reality, At Auto Shanghai 2023, Honda Unveils Three Electric Vehicles, ChatGPT Will Soon Be Able To Replace Teachers: Bill Gates, Artifact, An AI-Tool That Summarizes And Simplifies Lengthy Articles, Super Chat An AI Chatbot that Will Allow You to Talk to Fictional Characters. Have you actually started working less as a result of that? So you always have to, so this is what we keep telling ourselves, we have to always be better than competition. So we were very hands-on and theres a culture of being hands-on at Careem. Its not that Pakistan should do something. And thats what we believe is the biggest opportunity in the Middle East versus just a mobility opportunity or something else. Mudassir Sheikha: The kids are asleep. It drops you at a predetermined location. And the more Ive done it, the more I realize that this is something thats missing. Mudassir Sheikha: So literally for the first few months of Careem, we kept phones with us when we were sleeping so if someone calls at three a.m., the phone that rings is the phone that is next to me and it wakes up my wife and it wakes up Magnuss wife as well. : So this product market fit is a continuous thing. Mudassir Sheikha, CEO of Careem Operating in more than 100 cities across 14 countries, from Morocco to Pakistan, the group has more than 33m customers and can deploy more than 1.2m "captains . Every year, literally, there was an expansion of the vision based on what we were seeing in the market and some of the success and the growth that we were having. You know, now is that something that you defer to the local, or is it something that you say, no, as a Careem, we have certain values that supersede anything thats local? It has been a company that measures its growth rate in increments of 15 minutes across multiple countries, cultures, and the services it offers. Did you think about that? You can test people on them. During its first two years, to compete against Uber, Careem grew at an unprecedented rate of 30% per month. Right? See Mudassir Sheikha's compensation, career history, education, & memberships. They feel aligned and driven to make it happen. On day one, literally on day one, one of the first things that we did was we created the first version of our values. And please figure out the HR side of it, right? And there are cultures in which, say women, dont have positions of authority or its harder for them to exert authority. But then it becomes products and product market and so on. The living conditions of these drivers were appalling. And the something new, initially, was markets. Basically these are starting routes for now. So that expectation-setting held us for at least the first two years. Then you have to sort of make sure that it gets embedded in every aspect of the organization. And I think Abdulla earlier this year sat down with me and said, look, you cannot outsource values and Careem operating system to someone else. And she basically created a team and went after the opportunity. In November 2015, Careem announced a Series C round investment of US$60 million led by The Abraaj Group. When [inaudible] was picking up a call and speaking to a customer, I could overhear [inaudible] because he was sitting next to me. Then we empower them to the right resources to do this and we support them and do this, right? You know, I was an EP at Mackenzie, but I didnt know what Mackenzies revenue was because is not something that the organization spoke about ever. So if lets say, pricing as a topic. Youre constantly thinking of whats happening in the business or Its actually even more frustrating for them because youre there, but youre not there. : And our answer is that we will win by being more local than them. This page is not available in other languages. Mudassir Sheikha: Like the customer relationship. Under Sheikha's leadership, Careem became one of the fastest-growing start-ups in the region, raising over $771 million in funding and reaching a . Its Karachi should do something, Lahore should do something and the people that are running those cities need to be empowered to do those things. So these values, theyre somewhat universal, right? And who's more known worldwide for their important work, Moza or a bank CEO? And if Im not mistaken, there were once or twice flags were raised and things did not get much better. Like many things that we should have done differently, whether it is in financial processes, or the technology side, they were starting to leave a lot of skeletons that we were then having to go back and fix. In 2019, Uber announced that it had acquired Careem for $3.1 billion, making it the largest technology deal in the Middle East. Every six months, Careem was adding new people to the company and addressing the challenge of holding together the operations with its strong values. And Ill see the growth, but as soon as that promo code is over, the growth will vanish, right? Like ambition. And thats the gap, right? So the thing that we have done is weve defined a very clear vision of where we want to be in 2030, right? And if you were in a different industry, you might think about growth differently? And thats what we believe is the biggest opportunity in the Middle East versus just a mobility opportunity or something else. Mudassir Sheikha: Then we realized that we should become the public transport system for our cities because the public transportation systems were not existent like they were in Europe and the U.S and elsewhere. Its sugar high that you get in that process. Maybe this thing that were doing will not even materialize. And this was an initiative that was started by her. You go through that deck, you know, I think in literally half an hour, you get a very good sense of what this organization stands for. But rapid growth created internal strain. And now we think we should become the internet platform of the Middle East. And in the very beginning, even the people that were doing different things were sitting very close to us, so we knew everything that was happening. So thats the way we are approaching those things which require more scientific planning, thinking, and doing. What started in Dubai as a grassroots ride-sharing app back in 2012 has evolved into a . So it can be done at the country level. So thats what the definition of tough maybe was in the early days. And the third one is theres some things that the country or Dubai needs to control, right? Keep improving and stay humble. You did something inspirational. So basically what happens is lets say, you have this great product that customers love. Its not a static thing that we reach and we-. Mudassir Sheikha: So when we get a phone call and say hey, whats going in? And then you go home at? So its this thing of saying what are the central functions that you want everyone to do more or less the same way or following the same principles? And then you say, so what does that translate to what people have to do? The particular context that somebodys in. And the more I get into it, the more I realize that if you just get this right, then this thing will start running like a machine. What does it mean? But then youre not going to be doing all the hiring. So that person is living in that context, right? Shikhar Ghosh: So what does that mean? And now, of course, were many times that size now. Initially, 10 markets. : And then youve got to have some process or approach by which you can even judge whether the person is a values fit or not. If youre running a business of hundreds of millions of dollars, a mistake is many millions. Mudassir Sheikha: So they were suffering from not even getting proper sleep in the early days. The first is the default location for any activity is the city. Lets try to create some management layers that will create some sanity to it. Did you have it or did your wives have it? And now youre coming full circle and going back to saying once you see all the linkages, then you can reliably focus on this side because you know that its going to carry through. So at that point, we rolled down what we called a family contract. But for them, Riyadh is probably much lower in the pecking order. So it was very incremental and as it fired up, we solved it. Shikhar Ghosh: So, you know, this sort of working on these very short time schedules and intervening when things go off, so youve got dozens of markets. It grew pretty rapidly, even initially, and then at some point it became clear that your hands are not big enough to do all the things that you have to do. Learn why Sheikha believes disseminating culture by hiring the right people is one of the most important jobs the CEO of a scale-up can do. And so its interesting because you started by saying, you know, we focus on the outputs, the growth, every other thing. [3], In 2012, he left McKinsey & Company to form Careem with ex-McKinsey colleague, Magnus Olsson from Sweden. How much time is the captain spending, getting paid for a trip or is he waiting? The idea was not just to build a big business, but start one that would have a big impact, be meaningful, and with a mission to simplify and improve lives and create an awesome organisation that inspires. So that vision has been defined and that vision has been somewhat detailed as well at the next level. And at some point, there were many people reporting to me and Magnus said, look, this is not sustainable. Even a manager who follows the basic good principles that you have, these behave differently because thats the way organizations are. Mudassir Sheikha: So that part, in hindsight was we underestimated that challenge and we didnt invest enough in it. Mudassir Sheikha interviewed by Shikhar Ghosh, August 30, 2018, at Harvard Business School. But obviously, changing from six countries to the whole Middle East has all kinds of implications on the organization, how you need to organize, who the people are, how big its going to be. They know what theyre doing and they are extremely driven and in line with the mission and vision of Careem. So after CVC, we said lets start-. [8], In 2015, the company acquired a Saudi-based home service company and Abdulla Elyas joined Careem. Both on the captain side and the customer side. Shikhar Ghosh is a serial entrepreneur, angel investor, and Professor of Management Practice at HBS. This thing will start attracting the right people. What percent of the times is a car available? Shikhar Ghosh: So why every 15 minutes? Women were legally allowed to start driving on 24 June 2018, and Uber and Careem women drivers were able to start working on the same day. Its not a subjective thing. You and the founders. Pivoting For Progress: Why Careem Turned To A 0% Commission Model For Its Food Delivery Business. How do you think about that challenge? Be super, super ambitious. Mudassir Sheikha: So there are least two things which are different now than before. So you want them to behave differently if its a critical problem versus its not a critical problem, and so on. The entire company is looking at these numbers. So not much changed. And thats the gap, right? Mudassir Sheikha: When we raised our CVC, we actually promised ourselves that we will get away from that mindset, that were not going to keep patching things because that whole debt was starting to catch up to us. And on the customer side, for example, experience is a function of, you know, when you open the app, is a car available? [1][2], Mudassir grew up in Karachi, Pakistan. Careem is the first unicorn in the Middle East and a game-changer service for the region. And the third one is theres some things that the country or Dubai needs to control, right? They know what theyre doing and they are extremely driven and in line with the mission and vision of Careem. There will be some cultural nuances. Those are also very respectable growth rates. But guess what happens? And this is not just in growth, but this is in everything. Everyone says value is important. So this was something that she, being from Egypt, understood the opportunity, understood that there was a need for it. In 2014, it received funding of US$10 million in a Series B round led by Al Tayyar Travel Group and STC Ventures. [24] Saudi Telecom in this funding round invested in a 10% stake in Careem. And even if they find those local opportunities at the same time as us, were able to prioritize them much before them. It didnt seem impossible to pull off. : You know, why not 10% a month? Shes the entrepreneur now, right? Now, that vision has been defined. What were the things that surprised you that as you grew, you know, what were the things that you came in and said, well, this is sort of different from what it was, what I was thinking it might be? The idea for a transportation service oc. So this is something that we didnt pay enough attention to at the beginning, that in hindsight we would pay more attention to. : where I think the burden becomes higher is sort of to reinvent yourself. He started his career with Trilogy Software before joining San Francisco-based mobile experience startup Brience at the height of the dot-com bubble in March 2000. The company waited until late April, 2018, to disclose this breach because they "wanted to make sure we had the most accurate information before notifying people". I should have the ability to fire the service provider if the service provider is not performing well. : And the second thing which has happened, and you know, we had a conversation six months ago where I think you said something very interesting. But the path to becoming a unicorn wasnt straightforward or easy. Mudassir Sheikha: So the companies that come closest are the companies in China like Tencent or Alibaba in the way they sort of became the platform that others are built on top of, and they provide a lot of the enabling infrastructure for internet commerce. You have to keep finding the next thing thats going to give you a differentiated product, a better product that will command a slight premium on prices because we arent able to be cheaper than them. Despite the myriad hurdles which arose at different geographic locations, Sheikha established a company-wide culture that helped Careem thrive during the chaos of meteoric growth. But our definition of big was different back then. And then what was also happening in the early days is we had no customer service. I mean, now were not getting growth because that thing is no longer working. Sheikh Faisal Bin Qassim Al Thani had started with modest start-up capital in the 1960s as a small local trading company. Because you have to be looking at things and deciding when to intervene. Mudassir Sheikha: So well hopefully create these type of initiatives-. As one of the Middle East's unicorn startups, Careem made headlines in 2019 for its US$3.1 billion acquisition by Uber- but even that achievement didn't let it remain unscathed from the COVID-19 . So if you believe that your competitor is targeting these type of growth rates, then you cannot be targeting less than your main competitor. Mudassir Sheikha: So we just need to now build that operating system, we call it the Careem operating system, thats going to enable us to build this thing and realize the vision. [4] In 2020 Uber purchased Careem for $3.1 billion USD. And people get exhausted and they work really hard. Ive got a company that Im working with that does annual. Define the values and the culture that you want to create. But even at relatively high levels in that organization, you had no idea what a business was producing, right? A Karachi born Mudassir Sheikha was taken aback when he discovered that Pakistan has only one billion dollar company, outside the oil and gas industry, that is an FMCG company. So people are working really, really hard. But my view in looking back at this is it would have saved us a lot more fires. But youre across multiple countries, and these countries have very different cultures. Or were we giving just people feedback on their delivery and their performance? At least, I never did it. But the question is why minutes and not hours or days, right? The previous model we used with our restaurant partners did not live up to our mission; so, we pivoted. Growing at a rate of nearly 30 percent per month turned Careem, a mobile-based ride-hailing service, into the first unicorn of the Middle East. And please figure out the HR side of it, right? Shikhar Ghosh: Yeah. And these values we protect, even if the culture says otherwise, well protect these values and well push these values down on culture. So basically what happens is lets say, you have this great product that customers love. And you know, you worked at BCG and I spent some time at Mackenzie. So youve done it a hundred times, right? So that expectation-setting held us for at least the first two years. Theres questions that you ask and then, you know, based on the responses that you get, you can get a feel for it, right? Shikhar Ghosh: And the KPIs were mostly output-oriented? Or the systems that have to run, you know, like a railway thing. And then people start adjusting to the new reality. Mudassir Sheikha: Well, so you have to institutionalize it, right? You know, you can be ambitious in Pakistan and you can be ambitious in Egypt and you can be ambitious in Saudi, right? Mudassir Sheikha: So the ambition initially was actually not so big. Mudassir Sheikha: So this is not something that can be done right away or that can be outsourced. This was not translated to what it means for the different functions because I think if you sit down and think of it, you can do the translation, right? And then you started looking at examples of things that happened before and then you start building conviction, right? Its not even the country, right? So amazing experiences. Both companies apps will also continue to operate under separate brands. But there was no sight of things getting better. For the audience joining us on Zoom, he took live questions.GUEST BIO:Mudassir . Turned out they were just false assumptions of the market. And then what you realize is one, this business is 24/7. Or the systems that have to run, you know, like a railway thing. And on the customer side, for example, experience is a function of, you know, when you open the app, is a car available? : So this is not something that can be done right away or that can be outsourced. And so youre going to go through similar cycles of growth. Careem has not only tailored the service for its end users but also identified the unique challenges associated with the labour pool that is mostly immigrants in the Middle East and localized solutions for them. You became the CEO of this company somewhat reluctantly in the sense that you had the founders and then you all got together and this was what? So how do you deal with that? : The first principle is driven by mission and values. [10], In June 2017, Careem launched operations in Palestine as part of a commitment to create one million jobs in the MENA region by the end of 2018. and South Asia. Mudassir Sheikha: It had some validity, it had some relevance. You go in, you show the boarding pass, youre in. So next time you interview someone that is amazing in what needs to be done but is not a culture fit, youre more comfortable making that call that this person is not the right fit for Careem. Mudassir Sheikha: So thats been a core challenge for the last year almost, for us. You have to be involved in the process, you have to steer the process, you have to ride the process. This was a five-year business plan that was prepared in 2012. Mudassir then moved back to Pakistan and co-founded DeviceAnywhere, a company that was acquired by Keynote in 2008 before joining management consulting firm McKinsey & Company in Dubai. Both companies apps will also continue to operate under separate brands. Unlike various impact focused companies that focus on the end user, Careem started with its employees. If theres a super compelling reason for this thing to be done at the country level, then well do it at the country level otherwise well keep it at the city level. This is something that you as the CEO need to own. And then people start adjusting to the new reality. You know, we feel its okay to ping our databases every 15 minutes, thats fine. : So there are least two things which are different now than before. However, the rough estimates also indicate him to be . Ideally, youd designate some people that you believe are super-aligned with the values and these are the people that do this for It could be a few of them that do it for everyone so that theres some consistency thats applied to that process. For the next 10 years, he set a goal for building an institution from the region that delivers great products and creates a positive impact on the regional population. You know, you can be ambitious in Pakistan and you can be ambitious in Egypt and you can be ambitious in Saudi, right? : But at the same time, you know, youve got 24 hours in the day. We didnt really define what these values meant, what kind of behaviors we expected, took enough time at the beginning when people joined to onboard them properly on these values. Rumours of the said acquisition have been floating around since December 2018. And this was an initiative that was started by her. : So they were suffering from not even getting proper sleep in the early days. Shikhar Ghosh: So when you reflect on that, you know, because this is going on and theres no end in sight because the ambition keeps growing, you might reach a point where the systems are in place for the transportation side of the business. What were the things that surprised you that as you grew, you know, what were the things that you came in and said, well, this is sort of different from what it was, what I was thinking it might be? Processes were working fine three months ago but theyre not working now. So we tried that. So they say, you know, you can focus on profitability like you focus on jet You need it in order to keep the business and so on. And that has more engineers than us. And now, of course, were many times that size now. So the local adaptation probably gets factored in in some of these things. They need to be rallied and they need to be encouraged and they need to be inspired. You have to be at a certain scale to be competitive. So weve all been saying values are important. Mudassir Sheikha: Then you have to live the process. Sheikha is an alumnus of University of Southern California and Stanford University. Four of us sat down, Magnus, Sara, me, Saba, and we basically wrote down what we called the boundary conditions. And the default role is an advisory role. Should you Careem around Karachi, Lahore? WATCH LIVE. : So at what point, you know, we hear many companies go through two years of growth, right? Ideally, youd designate some people that you believe are super-aligned with the values and these are the people that do this for It could be a few of them that do it for everyone so that theres some consistency thats applied to that process. We didnt take it to the extension where it should have gone. Uber Technologies has agreed to buy Careem in a $3.1 billion (Dh11.39bn) deal that is the largest technology sector transaction in the Middle East so far, eclipsing Amazon's $580 million acquisition of Souq.com in 2017.. Once the transaction is completed early next year, Careem will become a . : So last question and then we can stop here. So growth was a big, you know, weekly growth rate. Mudassir Sheikha: Profitability then is an output, right? But thats not what generates anything. I dont know if you remember, where you said instead of focusing on problems, focus on people. How to work with our systems. And then our families could raise the flag as well and say you guys are not abiding to the contract that you signed with us. You could almost do any of the jobs yourself. Were we giving people feedback on the values? And you look at that and you say if Im in engineering or Im in accounting, you know, how do I translate that into do I really want a great experience in accounting? : Yeah, its a good question. Spend the first three to four hours just doing the things that Im supposed to do, which a lot of times is thinking through some of these topics that require more deliberate thinking. This scholarship will allow LUMS to reward the high performing undergraduate scholars at the Syed Babar Ali School of Science and Engineering (SBASSE), inspiring and nurturing a vision for . Shikhar Ghosh: You know, why not 10% a month? But obviously, changing from six countries to the whole Middle East has all kinds of implications on the organization, how you need to organize, who the people are, how big its going to be. Very early, Careem recognized the need for providing two different types of customer service. There will be some cultural nuances. They need to be rallied and they need to be encouraged and they need to be inspired. : But the way it manifests might be different in each of those cases. So you always have to, so this is what we keep telling ourselves, we have to always be better than competition. Even when youre there, youre not present. You start at six? Or do you think, like, well figure that out? So the kids are asleep, then? Mudassir Sheikha: I think 15 minutes or 30 minutes is within the same range. Then, do I get rid of this person? Qatar. Often, the strengths that differentiate an early-stage founder-CEO become liabilities as a business begins to rapidly scale. So you have to work through other people. Mudassir Sheikha: In fact, if anything, I felt I was busier two years into it than I was busy in the beginning because there was just a lot more to manage. So to the moon and beyond, be of service. Because a lot of times what happens is some strategies or things that work for us today and give us growth today will not be the things thatll give us growth six months from now because weve sort of played those things out. : But there are common systems, right? Those are also very respectable growth rates. : I think 15 minutes or 30 minutes is within the same range. Let me just be out there and make sure that we are hitting our growth numbers and we are competing and we are doing the right things. We just thought get the right people in place and they will figure out what to do. Certain aspects of the brand are part of it, but for the most part, we want to empower the front line and have them drive the decisions and only support them as an advisor versus become service providers or controllers.

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