Research and Blogs

Community Spotlight: Shapol Majid, Founder of Khanem Fashion

Shapol Majid is the Founder of Khanem Fashion in Sulaimani. We talked to Shapol about her efforts to support female entrepreneurship and empowerment, the challenges of franchising a business in Iraq, and how her experience abroad influenced her goals and work ethic when she decided to start her business in her hometown of Sulaimani.

AEI: Could you briefly describe your business and what inspired you to start it here in Sulaimani?

SM: I have long committed myself to the empowerment of women. I have chosen to do this in a rather unusual way: by means of lingerie. A woman’s body can be her strength in many circumstances, but it can also be a vulnerability. This ambivalence is exceptionally apparent when it comes to wearing and showing lingerie. And for exactly this reason, lingerie has the potential to be a strong vehicle for empowerment. In a society that is mainly run by men, lingerie still exclusively belongs to the domain of women.

As a native of Sulaimani, I chose the city as a launching point for my lingerie business, Khanem Fashion. I was born here and went to school here, and an important part of my family still lives in the city. Although I currently live in the Netherlands, I have always kept a close connection to Kurdistan. My experiences living between Kurdistan and the Netherlands influenced my decision and goals in starting my business in Sulaimani and adapting it to the needs of women specifically in the region.

In much of the Western world, you can buy (quality and well-fitting) lingerie anywhere and feel safe while doing so; however, this is not always the case in Iraq and the Kurdistan Region. There are almost no shops with discrete fitting rooms or sales ladies who will take your measurements to ensure a good fit. Khanem, my brand of lingerie, is therefore exclusively sold by female merchants in a woman-friendly environment. In our shop in Sulaimani, women can buy well-fitting, comfortable, and high quality garments without feeling intimidated or spied upon.

While all these factors are indeed important, “woman-friendly” means more than just ensuring a comfortable and safe shopping and fitting experience. Khanem Fashion is committed to women working in the entire chain of business, whether it involves selling, designing, or producing lingerie in a way that ensures their safety as much as the customers’. Khanem Fashion thus constitutes a safe and independent livelihood for every woman across all chains of the business. Khanem Fashion supports women locally by providing decent working conditions so they are empowered to care for themselves and their families. At present, Khanem Fashion personnel in Sulaimani are economically independent because they benefit from a safe work environment with fair pay.

AEI: How did your time in the Netherlands shape your business plan in Sulaimani and the Kurdistan Region?

SM: First of all, during my time studying Middle Eastern Studies at the University of Utrecht and International Law in London, I learned to think analytically. More generally, my time abroad allowed me to expand my horizons and eventually start a career working for different government agencies and private companies in the Netherlands. Working for these highly professional employers in a variety of capacities has taught me to adopt a pragmatic and efficient working style that enables me to develop and execute long-term goals.

Since the early phase of my company, I have communicated with different Dutch agencies, including the Dutch Chamber of Commerce, the Institute for Socially Sustainable Enterprising (MVO), the Governmental Agency for Dutch Business (RVO), and the International Department of Municipality of Utrecht. From them, I have received a lot of useful advice about global enterprising and maintained a network with the Dutch national political representation in different countries. In Kurdistan, I am a frequent visitor of the Dutch embassy in Erbil, from whom I have received important financial support.

In addition to governmental initiatives, I have also received valuable information from collective initiatives set up by successful entrepreneurs—in particular, the Dutch ondernemersklankbord (OKB), or Entrepreneurial Soundboard—to share their knowledge and experience with up-starts free of charge. It has been very helpful to obtain invaluable advice from these professionals on matters related to starting a business, such as taxes, regulations, and import/export requirements.

Unfortunately, there are no such agencies or initiatives in Kurdistan. This meant that I had to learn and discover a lot by myself. I think it would be great if Kurdistan took note of the existing successes of such initiatives abroad to establish similar agencies here in the region. Since Kurdistan has experienced some economic improvement in recent years, I am convinced that there would be high demand for such agencies or networks.

AEI: What are the biggest obstacles you faced in starting your own business?

SM: One of the major obstacles to our development as a business was the (political) instability in the region. We opened our store in Sulaimani in 2014, and three months later, ISIS attacked Mosul. Refugees started pouring in and the economic crisis slowed sales considerably. The effects of these tragic events are still present. One example of this instability is the refusal of the central agency in Baghdad to recognize our registration in the Chamber of Commerce in Sulaimani (KRI). As a result, we recently were not able to open a bank account at the Trade Bank of Iraq (TBI). In response to my question about how to proceed, I was told to go to Baghdad to register the company again for a considerable amount of money. This procedure would have cost me around 50 USD in The Netherlands and about half an hour of my time. In Kurdistan, on the other hand, registering the store cost me about 6000 USD and took me more than six months. Registering the store in Baghdad would force me to pay this amount of money again, in addition to spending money on travel.

A different but equally troublesome result of the political situation is the lack of uniform tax regulation between Iraq and the Kurdistan Region. This means that when we import goods to Kurdistan, we have to pay tariffs. When shipping these goods from the store to Baghdad or to other territories in federal Iraq, we have to pay tariffs again.

AEI: What are your plans for scaling up/expanding, and what do you think is the biggest challenge in general to scaling up/creating a franchise in Iraq and the KRI?

SM: Our vision is to start and produce our very own collection by and for women in 2019. Design, production, and management will all be run by women in the Kurdistan Region. Khanem wants to lead by example. From woman-friendly stores (for both customers and personnel) and franchise possibilities to the sewing in our atelier, Khanem will empower women in Iraq and the Kurdistan Region to work independently in a safe and supportive environment.

To bring our products to our customers, we are working on a plan to open additional stores in Erbil and Baghdad in 2020. Furthermore, we are striving to expand our operation online. Currently, we are experiencing considerable growth on the internet, so naturally this is one of our main focuses for 2019.

For more information on Khanem Fashion, you can visit the Facebook or Instagram pages.

Community Spotlight: Faten Alweli, Founder of Escape the Room Baghdad

 

Faten Alweli is the co-founder of Baghdad’s first “Escape the Room,” an interactive puzzle game in which participants follow clues to complete an adventure. We talked to Faten about her inspiration to build an escape room in Baghdad, concerns about starting her own business, and ways her various professional endeavors complement her life as an entrepreneur.

 

AEI: What gave you the idea to start the first Escape the Room in Baghdad?

 

FA: In 2015, my family and I played Escape the Room in Amman, Jordan and we loved it. It was one of the most fun and exciting periods of quality time we spent together as family, and from that moment I fell in love with the concept of this game and how it brought us all together away from the struggles of daily life and distractions of social media. As a result, my husband and I started working on the idea of opening an escape room in Baghdad. We later found out that one of our friends was trying to open one too, so we became partners and started to design, build, and promote the game as a one-of-a-kind experience in Iraq for family, friends, and coworkers.

 

AEI: What was your biggest worry with starting your own business?

 

FA: We had a lot of concerns, the first of which was financial, as we didn't have any idea of how to raise money or take a loan from a bank and thus had to take the risk of relying on our savings. Second, although security was not a top concern, it affects our working hours as Baghdad can have long holidays with road blocks. Our third concern was business registration, as we did not want to pay a lot of money to register our game as a company in the beginning of its launch. It also did not seem reasonable to pay $5000 just to register it since at the same time we would have any copyrights protection. A fourth issue we had was taxes; although we are considered as a small business, the taxes we were required to pay were really high and we struggled with it. Finally, we had a lot of trouble importing parts of the game because we had to pay extra taxes and wait for long periods of time to receive the parts.

 

AEI: Can you describe the process for registering your business, and how you overcame any related challenges?

 

FA: As mentioned previously, we didn't want to pay a lot of money to register our game as a company at its launch given the high price and lack of copyright protection. Until now, we are still only registered as a game shop rather than a company since company registration would require extra fees with no further benefits.

 

AEI: How does your current work complement your experience of running a startup?

 

FA: I currently work with the UN and have also worked with Iraqi companies as a business development consultant. As a business development consultant, my growing familiarity with the needs of these companies helped me build various aspects of our own business, including the B2B element, staff team building activities, annual retreats focused on communication and cooperation, and customization of mobile escape game experiences to the needs of companies with whom we work. Since the early days of our launch, we’ve been able to expand our work with local and international NGOs, youth groups, conferences, embassies and entrepreneurial events.

 

A Parallel Iraq – A thriving entrepreneurial culture has taken root

 
Originally published in bite.tech by Ahmed Tabaqchali and Emily Burlinghaus in October 2018. 
 
 

Most of the coverage and analysis of Iraq post-2003—by international, regional, and local journalists and analysts—has focused on the dysfunctional state and warring political elites whose failures to provide basic services to an already alienated population has come in sharp focus during the recent Basra demonstrations. However, despite the vital nature of this coverage, it has missed a new entrepreneurial Iraq—represented by its youth—that has emerged and flourished in the new cultural openness and interconnectedness of post-2003 Iraq.

Since 2003, Iraqis’ and Westerners’ sentiments of blame and guilt in response to the 2003 invasion—as legitimate as they are—overlook the silver lining that accompanied it. For all its ills, Iraq experiences freedom from state censorship, unfettered access to the world, and life that is mostly free from state interference. It is this openness that has provided youth with an opportunity to create exciting new businesses. They inhabit a parallel Iraq—one that is undiscovered by both the outside world and many Iraqis whose spirits have been crushed by the trauma of conflict and daily grind of living in a country largely defined by corruption and mismanagement.

The opening of “The Station,” the first purpose-built co-working space for young entrepreneurs in Baghdad, in early 2018 brought much neededyet fleeting, attention to this parallel Iraq. The Station, however, is just a small taste of the vibrant entrepreneurial space operating in Baghdad and elsewhere in Iraq. A recent trip to Baghdad by members of the AUIS Entrepreneurship Initiative (AEI) provided a brief opportunity to explore the scene at The Station, Al-Faisaliya Restaurant & Café, and IQPeace—three different manifestations of the co-working space in the Baghdad. Each location—along with the startups it supports—has a story worth telling.

Over the past several years, a rich culture of entrepreneurship has developed in Baghdad upon which these new co-working spaces and their supported startups have flourished. Some of the most well-known of these success stories include Miswag and Mishwar, online and app-based delivery platforms, and the first “Escape the Room” game in Iraq. Recently-founded startups such as Hilli, Bilweekend, Daraj, Tech4Peace, and Ikfal Nakhla have taken inspiration from these initial success stories and expanded the need and market for co-working spaces, mentorship, and training programs. They have joined the ranks of others such as Brsima, Indigo Canvas, The Book Cafe, and Mirsha Media, as well as training organizations such as re:coded, Tech Hub, and Five One Labs based in Sulaimani and Erbil. These, in turn, are part of a broader network that extends all the way from northern Iraq down to Najaf and Basra.

 

 (below is an overview of three Baghdad-based co-working spaces and a major virtual support network, a list of some unique established and emerging start-ups in Baghdad, and an overview of some additional startups operating at various stages in the Kurdistan Region of Iraq.)                                                                             

The visons, business models, and growth challenges of Iraq’s start-ups are no different than start-ups elsewhere in the world; however, they face additional Iraq-specific challenges as detailed in a 2017 report by IRIS “Obstacles and Opportunities for Entrepreneurship in Iraq and the Kurdistan Region.” These broadly fall into three main categories.

Bureaucracy

The first category, bureaucracy, involves an extensive network of public sector requirements to incorporate and maintain companies. Such lengthy procedures place huge financial, time, and operational demands on these start-ups. As a result, most of them opt to operate in the shadow economy—a decision that stunts their growth prospects and hinders their abilities to develop into sustainable growth companies that would expand the private sector.

Infrastructure

The second category, infrastructure challenges, is defined by a number of problems, the most notable of which is the under-developed banking sector and its very slow adoption of mobile banking and payment systems despite the wide adoption of mobile phones. Almost all transactions with suppliers, trade counter-parties, and customers are performed in cash, which strains working capital and affects start-ups’ cash flows and operating flexibility, security, and transaction paper trail, and increases the costs of handling cash. Other infrastructure challenges include a cumbersome legal structure and poor enforcement of existing regulations, both of which affect trade and payment disputes and weaken intellectual property and copy rights.

Access to Capital

The third and the most crucial category is the very limited access to capital. The main sources of growth capital in Iraq come from savings, family, and friends. Entrepreneurs face extremely limited access to or availability of bank lending and local investors. In the rare cases that either of these options are available—i.e.  banks and investors—they demand high collateral and immediate high returns in the form of interest payments or dividends. These limit investments and business options to those that generate quick returns rather than encourage ongoing investments in the form of reinvested earnings that generate sustainable businesses.

The solutions provided by these co-working spaces and AUIS’s upcoming Entrepreneurship Initiative go a long way in providing a nurturing environment essential to encouraging and sustaining the entrepreneurial culture. However, long-term and patient investment capital is crucial for these efforts to be translated into a thriving start-up scene in which existing start-ups can evolve into larger sustainable companies.

Iraq’s challenging environment means that the sustainability of start-ups is fraught with uncertainty. Therefore, only long-term and patient investment capital can accept the high risks and the long wait time for financial returns – which is what is necessary for these start-ups to transform into successful companies. 

In more developed economies, this long-term capital is provided through an ecosystem of angel investors, venture capital firms, and private equity funds. However, the development of these mechanisms in Iraq requires considerable time and the introduction of new laws, regulations, and policies. The dilemma for Iraq is that the need for such long-term capital is immediate, and therefore the need to find solutions to bridge this gap is urgent.

A viable solution is the creation of an investment fund that combines the attributes of angel investment, venture capital, and private equity funds to provide the growth and expansion capital for commercially promising start-ups. However, the risk profile of the underlying investments means that initial funding will come from neither the traditionally risk-averse and short-term focused private sector nor the Iraqi public sector given the enormous demands placed upon it and its strained resources. Therefore, initial investment capital must come from Iraq’s international stakeholders as part of their support and development aid. Private sector capital will, in time, be attracted to the fund once the risk-profile is lowered by evidence of its success and higher possibilities of financial returns.

The fund’s success will, to a large extent, be dependent on the existing entrepreneurial culture that has succeeded despite all odds and prevailing pessimism, and therefore would build upon an existing success story. Its establishment would fuel the enthusiasm and achievement of these young, bright start-ups by providing them with the essential capital required to build upon and sustain their achievements. Their success will invite others to join, and therefore herald the emergence of an independent private sector in Iraq.

Baghdad offers a variety of spaces that provide support in the form of mentorship, and networking, and skills development. These range from a state-of-the-art coworking space to a startup-hosting cafe and community center designated to creativity and innovation.

Al-Faisaliya Restaurant & Cafe

  • Founded in March 2017 in Karrada
  • Cafe and restaurant with live music and local bands like Project 904
  • Features local startups Hili, Daraj, Tech 4 Peace, Razouna, and Jakaroo
  • Hosts game nights, films, speakers, and literary sessions

IQPeace

  • Founded in 2011 in Karrada
  • Center that offers daily support for young innovators and a space for music and art production
  • Develops programming in 5 categories: music production, entrepreneurship, photography, computer programming, and peacebuilding and conflict resolution
  • Helps individuals and groups establish and build membership in specialized clubs on a variety of topics, including music, jazz, chess, and nutrition
  • Uses recyclable and sustainable material in building structures, including a solar-powered phone charging station
  • Organizes the annual Baghdad City of Peace Carnival, which at its most recent celebration in September 2018, attracted approximately 30,000 visitors

The Station

  • Founded in February 2018 in Karrada
  • State-of-the-art co-working space and maker space that offers events, workshops, and talks for innovators and entrepreneurs at different levels of membership for a fee
  • Helps tech, cultural, and social entrepreneurs such as Bilweekend, Baghdad Toastmasters, World Merit Iraq, Daraj, Zuqaq13, Ariika and Ikfal Nakhla by providing physical space, mentorship, and training to develop and expand their businesses

Zain Innovation Campus

  • Support hub for entrepreneurs, currently with a physical space in Amman, Jordan, but with virtual support for entrepreneurs in Iraq in the form of resources, activities, and workshops. Zain augmented this with its youth empowerment platform, ZY, aimed at unlocking opportunities for the youth

The following is just a small list of successful and emerging startups in Baghdad, both independently and with the support of startup spaces such as those listed above:

Miswag: First internet-based startup e-commerce platform in Iraq founded in 2014; delivery service operating out of two main branches in Baghdad and Erbil. Upwards of 700,000 Iraqi users can buy more than 250 brands from over 200 local and international merchants through the online service

Mishwar: Online and mobile-app based home grocery delivery service founded in 2015

Hilli: Founded in December 2016 as a physical and online store based in Baghdad and Erbil to sell handicrafts inspired by Mesopotamian culture; promotes domestic production and empowerment of women IDPs by providing them with employment opportunities

Escape the Room Iraq: First escape room game in Baghdad founded in 2017 for group activities and team-building events

Bilweekend: Travel and tourism startup with the goal of promoting cultural heritage as a factor of country development; organizes group camping trips, museum visits, and adventures to natural sites such as Dukan Lake in Sulaimani and the marshes of southern Iraq

Zuqaq13: Baghdad-based and inspired streetwear brand that designs t-shirts and other souvenirs influenced by pop culture and Iraqi heritage

Ariika: Distributor of beanbags and other alternative furniture, based virtually and at The Station Baghdad

Tech4Peace: Online platform with physical location at Faisaliyya cafe dedicated to exposing the credibility of public statements and social media postings in Iraq and the region. Its mission is to “expose lies, spread truth, and protect individual privacy”

Daraj Library: Book-selling and renting vendor for Arabic and English-language texts and novels with three locations in Baghdad and one in Mosul

Ikfal Nakhla (Palm Tree Subscription): Youth-powered project initiated by a group of entrepreneurs aiming to retain the numbers and productivity of the Iraqi palm tree by providing a date palm tree maintenance service on subscription. The project--whose goal is to encourage the growth and use of domestic palms and dates--remains sustainable by selling a portion of the dates from the trees they maintain on the domestic market. Annual subscriptions vary on the basis of the percentage of dates customers retain in their homes.

Project 904: Youth band that remixes old Iraq songs with modern rock and roll and performs in local venues such as Al-Faisaliya Cafe

Supernova: Computer coding and programming school with online and in-person learning options and Arabic-language content; supported by re:coded

The vibrant start-up ecosystem is not unique to Baghdad; support networks, training organizations, and young creative businesses are emerging all across Iraq. Here are just a few:

Five One Labs: An Erbil and Sulaimani-based start-up incubator that provides entrepreneurs with training, mentorship, and a network of innovators from across the region

re:coded: An Erbil-based organization that supports start-ups through coding bootcamps and a tech start-up academy

The Book Cafe: An Erbil-based café, bookstore, and creative co-working space that hosts speakers, events, film nights, and language learning groups

Brsima: An app-based food delivery service based in Sulaimani and Erbil that connects local restaurants with customers and delivers food to their doors

Peyk Bookstore: Sulaimani-based independent online bookstore that delivers books from all over the world after customers place orders via Facebook and Instagram

Mirsha Media: Erbil-based digital media consultancy that provides virtual reality and augmented reality content, 360° video, and social media marketing and management

Indigo: Sulaimani-based advertising agency that curates and develops brands for companies by using media, buses and taxis, and billboards

Ekaratay: An online real estate platform developed by an Erbil-based team to connect potential home-buyers with sellers; supported by re:coded     

Dakakenna: A Mosul-based shopping delivery service that offers nearly 2,000 items to buy via an iPhone app and shipped directly to customers; the service has already sold over 9 million IQD ($7,578 USD) worth of products and contracted 14 suppliers since inception in July 2018

Girfan Bazaar: Online and app-based platform connecting shoppers to stores in the Erbil bazaar to streamline the shopping experience and connect buyers and sellers with exactly what they are looking for

Erbil Delivery: Online and app-based grocery delivery service that operates its own warehouses in Erbil

Opportunity: Online and app-based platform that connects job seekers with potential employers, volunteer options, and skills development opportunities

Mowja: A Najaf-based self-financing NGO and miniature library and bookstore whose physical space relies on recycled materials 

Science Camp: collaborative laboratory and maker space in which innovators can design and create tech and engineering-focused projects

Disclaimer

Ahmed Tabaqchali’s comments, opinions and analyses are personal views and are intended to be for informational purposes and general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any fund or security or to adopt any investment strategy. It does not constitute legal or tax or investment advice. The information provided in this material is compiled from sources that are believed to be reliable, but no guarantee is made of its correctness, is rendered as at publication date and may change without notice and it is not intended as a complete analysis of every material fact regarding Iraq, the region, market or investment. 

Alumni Spotlight: Shkar Qaradaghi, Founder of Monster Muscle Protein Shop

Shkar Qaradaghi, an alum of the AUIS Mechanical Engineering Department, is the founder of Monster Muscle Protein Shop in Sulaimani. We interviewed Shkar about the passion that helped him start his business, the challenges of health inspections and registration for businesses dealing with imported products, and successful marketing strategies.

AEI: Can you briefly describe the passion that led you to start a business specifically related to health and nutrition?

SQ: I started going to the gym the year I started my studies at AUIS back in 2012. At that time, fitness wasn't as popular as it is now, but there was still a large number of people who cared about their physical well-being. When I saw my body transform and respond to my diet and workouts, I began to love fitness. I started convincing my friends and family members to start enrolling in gyms and adding physical activity to their daily schedules. I remember when I bought supplements for the first time, the knowledge of the representative at the store was very limited; he didn’t know much about the products he was selling beyond the price. He had no knowledge of the products’ health benefits or their recommended dosages. This was very demotivating for me, and I began to think of all the other young teens in the city who enjoyed working out and wanted to become healthier individuals but needed more knowledge in order to do so. I could do my research online and gather information, but what about those who didn’t know how to read English or couldn’t collect information online? This thinking led me to start my own supplement and nutrition store.

AEI: I'd imagine a lot of the products you sell come from outside the KRI. Are there any obstacles you face specifically in importing your products?

SQ: All of the products we sell are imported to Kurdistan from different parts of the world. The obstacles we face with every shipment are many: all our products must be inspected by the KMCA (Kurdistan Medical Control Agency) to make sure the contents of each bottle match the nutritional facts labels. The KMCA requires different certificates that are supposed to be provided by the companies selling the products to a business; however, it frequently claims that rules have changed and requires different documents each time we bring a new shipment. Original copies of these documents must be provided so this process usually delays our shipments. After this part of the process is completed, the KMCA then gives businesses legal rights to import products into Kurdistan, and the shipment is then checked by doctors working at checkpoints around Kurdistan as it goes from one city to another. These doctors work about three hours a day because they are on strike for not being paid their paychecks, so if you just happen to miss the doctors’ working hours, your shipment must stay at that checkpoint until the doctor returns the next day.

AEI: Since the nutrition and supplement industry is relatively new to Kurdistan, what are some of the challenges of company registration procedures in this industry?

SQ: It is difficult to register a nutrition/supplements store because government organizations are typically hesitant to register this type of company given the risk that companies would have all legal rights to import products whenever they wanted. Registration typically involves a process of referrals from one government organization to another, for example the Chamber of Commerce, Ministry of Health, Ministry of Sports and Youth, or provincial governorate.

Furthermore, food and beverages (anything edible) needs to have Arabic labeling and instructions in order to be imported to Iraq. Supplements, for example, do not have Arabic labeling, which makes every shipment a hassle. Typically the approach of the KMCA is to make an exception each time with the disclaimer that they will have the issue sorted out in the next month. This process is repeated with each shipment. Depending on who is working at the checkpoint on any given day, the requirements for documentation change frequently.

AEI: How did you develop a marketing strategy for your business? What is the best way you think you appeal to potential customers?

SQ: We currently have points of sales at five gyms around Sulaimani other than our main shop located on Baxtyari's main road. We sponsor events such as the AUIS Strength Week and other contests at the gyms with whom we have partnered. We also sponsor athletes who care about fitness and healthy living and share the love we have for sports.

Community Spotlight: Hal Miran, Founder and CEO of MSELECT; Editor-in-Chief of Bite.Tech

 
 
Hal Miran is the founder and CEO of MSELECT and editor-in-chief of Bite.Tech, a news source that covers the entrepreneurial ecosystem in Iraq. We talked to Hal about the HR challenges of starting and running a business, the importance of tech journalism, and the key players promoting entrepreneurship in Iraq.
 
AEI: Could you please briefly describe your background and path toward your current career?
 
HM: At university, I studied computer science, which I really enjoyed, but back then, computing and information technology (IT) was not as cool as it is now, so I finished computer science and I went into banking in London. I worked for an investment fund, then in investment banking, where I stayed for about 8 or 9 years. It was fun, I travelled all over the world, and I learned a lot, but eventually I hated the idea of working for a corporate. Some people love it, but it really wasn’t me. By 2008 the global financial recession had just hit, and the global banking industry was never to be the same again, so in 2011 I decided to put my job aside and move to Erbil to start MSELECT.
 
AEI: Did the impetus to start your own business come from your disillusionment with working for a corporation, or from other reasons?
 
HM: I think I’ve always known I wanted to do my own thing. Even as a kid, I set up a sweet shop at my school, and I’d have to give half the money to charity. However, the corporate experience enabled me to do what I am doing today. I don’t think I’d be where I am now without that. Starting MSELECT gave me the experience of establishing a business and going through the usual difficulties that come with starting your own business, naturally this made starting new initiatives easier. 
 
AEI: Did you feel you were filling some sort of gap in Iraq/the KRI by starting MSELECT? What made you choose the recruiting industry in particular?
 
HM: I didn’t really know much about the recruiting industry before I moved to Erbil, even though I spent a gap year at a major staffing consultancy in London, however after spending a year analysing the market, I realized this was definitely an area that could expand in Iraq. I spent a lot of time reading up on the industry and didn’t even really create a business plan or financial forecast; I didn’t believe I needed that to know there was a gap. I’m a bit of a risk taker so I just started off.
 
AEI: So it started in Erbil, and now you’re in a lot of different cities in Kurdistan and Iraq?
 
HM: Yes, the first office was in Erbil. (I didn’t even have an office at first actually--I was just working remotely part-time whilst also working on other things). When we formed a small team, we just had a small office in a mall. We had around five or six people in this small space whilst I was remotely working as I had other commitments at the time. It was quite funny because we were having meetings with massive global companies in this little office in a mall. In a way I’d like to think these big clients (as they later became) appreciated we were a start-up that was going to work around the clock to support them, maybe more so than larger international staffing agencies. Then we expanded in Iraq, as well as internationally.
 
AEI: What were some of your biggest challenges in starting MSELECT?
 
HM: Some of the harder things related to starting a business are not actually related to the business itself. Such as managing people. When you start a business, you learn a lot about the people side of things, this is even more complicated when working in a different culture and work ethic. Essentially, human resources is a major cog of any business. So that’s one side. On the other side, you have to learn pretty much everything that’s involved in running a business, advertising, marketing, or sales etc. For me, the best way of learning these areas was to start off small and continuously improve and get more advanced. Every now and then I review the evolution of the business to see how far we have come.   
 
AEI: I want to switch gears and talk a bit about Bite.Tech. What inspired you to get involved with tech journalism, and how do you think that complements what you’ve been working on for the past few years?
 
HM: I’ve always been a techie at heart, and I’ve always wanted to use my computing knowledge. About two years ago, I started supporting a couple startups here locally. Around the same time, I was looking for online resources about the startup ecosystem in Iraq and realized it didn’t exist. Pretty much every country in the world has a news source in English giving an overview of its start-up ecosystem. So I thought this was an opportunity to start one. It’s growing by the month, and it’s been fun. We receive messages from all over the world asking all sorts of questions and we are involved from the early days in something that could one day grow to be hugely important for the country. Since Bite.Tech we also launched TechHub in Erbil, this was the first co-working space in the country and has been pretty much full since the launch. A few other coworking spaces have opened up since which is a very positive sign.
 
AEI: What specific needs do you think can be satisfied by entrepreneurship in Iraq and the KRI, specifically in terms of stimulating private sector growth? 
 
HM: There is a lot that Iraq needs as a country. It’s still very much a frontier and needs pretty much everything. We do not have the same level of entrepreneurial spirit as the rest of our region. And that probably comes with the culture and traditions, such as the fact that a government job was historically more of an ambition than starting a business. The mindset is shifting as we can all see but its going to take time, education will be a big part of this shift and we also need the government to genuinely understand that the private sector is where most jobs come from. 
 
AEI: Do you think there’s a way that entrepreneurs and policy makers can work together to make it easier for entrepreneurs or the private sector to work here?
 
HM: Yes for sure. We don’t have to go far. We can just look at what the region around us is doing and see why they’re so much further ahead. If you take Jordan for example, you can see how the government is encouraging, educating, and financially supporting entrepreneurs and small businesses. This is all missing in Iraq.
 
AEI: Could you identify some key players in entrepreneurship or private sector growth in Iraq and the KRI, particularly in the realm of businesses, investors, or venture capital?
 
HMInternational investors contact us via Bite.Tech often inquiring if there are any start-ups we can recommend them to look at. The main issue is that investors will not invest until they know their money is safe and protected and that local businesses are reporting according to their investment guidelines. The last thing an international investor wants is to go through Iraqi courts for any disputes. They also want to see a clear path to an attractive return on their investment, this needs to be considerably high for them to invest in a business in Iraq. 
 
However, progress is being made. Mohammed Khudairi, a key player in the growth of the ecosystem, has recently launched Iraq Tech Ventures (ITV) to provide a mechanism for international investors to invest in Iraqi start-ups. ITV are working on creating a legal framework with international lawyers in order to bring confidence to the market. 
 
In terms of businesses that are engaged in the social entrepreneurship side of things, Zain is very active--probably the most active in Iraq. Although, we need more involvement from major corporations who eventually will also benefit from the growth of a tech ecosystem.
 
AEI: Last question: do you have any advice for aspiring entrepreneurs in this region?
 
HM: A lot of people think Iraq is a tough place to start a business because you may not have the resources or required infrastructure at hand, but the positive side is that it’s a hugely untapped market. 
Investors want to invest in businesses that are making revenue, have a clear vision, a solid team in place, and with a business model that has difficult barriers to replicate.
 
There really are some great opportunities out there. And there’s really nothing to hold anyone back; if you have an idea, you just need to go out and get stuck in.
 

Alumni Spotlight: Rawaz Barznji, Managing Director of Satchel & Pouch Business Consulting Firm and Founder of Suli Capital

Rawaz Barznji, a 2015 alum of the MBA program at AUIS, is the founder of Satchel & Pouch Business Consulting Firm, whose headquarters is based in Sulaimani but operates internationally. We interviewed Rawaz about developing a client base, working “smart,” and competing in the market of Iraq-based business consulting.

 

AEI: What gave you the idea for starting Satchel & Pouch? And how did you decide on the name Satchel & Pouch?

 

RB: I previously had a need for business consulting services, and quickly discovered that there were no firms in operation locally which offered such services, and this prompted me to consider offering these services myself based on my own experience as an entrepreneur starting and managing business in Iraq, and dealing with an international client base both within Iraq and abroad.

 

I have always had a personal interest in branding and ideas of business identity, and, as Satchel & Pouch is operating on an international scale and conducting its businesses in many languages, the name had to be something simple and memorable in English, the international language of business. I believe that our name conveys the simple but important message that we address our clients’ specific needs at strategic and operational levels.

 

AEI: Can you describe the process by which you find clients?

 

RB: We have been able to win and retain a significant number of clients outside of Iraq by utilizing our strong network of consultants and business partners in the UK, US, UAE, Lebanon, and elsewhere, and have used our local/national network in a similar manner to build relationships and expand our business here in Iraq with both private and public sectors. International outreach is easy and efficient, and within Iraq, I am able to use my personal network to “connect the dots” and, as one of the very few such firms operating here, deliver a differentiated product to keep clients happy and further build our own brand in this nascent market.

 

AEI: How is your business different from your competitors? Is there a lot of competition in the Kurdistan Region in the field of business consulting?

 

RB: There is not much competition on a local scale, but many companies are trying to enter the Iraqi market from the outside. However, this has clearly not proven easy for them. Without an established infrastructure and the personal network and cultural knowledge that come with a dedicated presence on the ground, I believe that these companies will continue to find it difficult to build traction here in Iraq.]

 

AEI: What's the #1 skill you think is needed for success is business consulting?

 

RB: Our slogan is “Work Smart.” Our job is not merely to provide services on request, but rather to anticipate the strategic and operational needs of our clients and present them with opportunities to improve their businesses. Working hard is still important, but we now live in a world where working smart is key – the world economy has changed drastically over the past two decades, and some of the world’s most prominent businesses today provide services that were nowhere close to existing a generation ago. We are constantly evolving and are thus able to meet the needs of our clients even before they perceive the need for a change.

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