This article was originally published on Nuwait.
The acquisition of Talabat by German internet company Rocket Internet was the first of its kind in the Arab world, amounting to over $170 million.
But growing a company and later selling it to a giant is not a process to be taken lightly. In this interview with Mohammed Jaffar, former CEO of Talabat, we shed light on the exit process, discuss what it was like selling the company, and what life is like post-Talabat.
Nuwait: What are you doing now?
Mohammed Jaffar: After exiting Talabat, I struggled trying to decide what to do next.
There were many opportunities, but I was determined to be selective and only pursue what I was passionate about. There were two paths in front of me. Invest in one company again, and acquire it the way I did with Talabat, or go into funding startups.
I chose the second option and am in the process of setting up a fund in 2016 with the support of my family. The fund is geared towards GCC startups in the technology sector.
Nuwait: What do you primarily look for when deciding if you’re going to invest in a business?
Jaffar: It’s all about the person running the show. There must be an understanding that the investment is more than just financial. I want to be there and offer support on how to operate a company – it can’t just be about money anymore. Today, startups have more opportunities to access a pool of financial resources; but it isn’t as easy to access experience and perspective on how to build a business. My goal is to offer my experience as an operator, in addition to the funding, to drive their ideas forward and help them scale.
Nuwait: Walk me through the process of exiting Talabat. Did you already have a plan in place?
Jaffar: You should always have an exit plan in place.
I’m not saying you should go into a business with the intention to sell. Instead, you should go into a business with the intention to build something great. When I went to my family in 2009 and told them about the idea I had to acquire Talabat, I didn’t go in with the attitude that I wanted to just eventually sell it off.
If you focus on quality, buyers will come on their own.
That’s why I focused on creating an actual culture within Talabat – an environment that allowed our people to strive for success because they believed in the business and wanted to see it grow. I also saw the importance of having a quality management system. All our business operations expressed in writing – policies, processes, and procedures. When we had these things in place, and buyers started to knock on our door, it made the entire exit process easier because there was less work for the acquiring company to do in terms of the actual handover process.
The first step was looking at our people and our organizational structure. Then came our operations, followed by our financials. Did we have the right employees? Were they well trained? Did we have a proper operational system in place?
These factors shaped the exit process overall.
Nuwait: How long did the acquisition process take?
Jaffar: We were approached in mid 2014. Things were slow in the beginning and didn’t take off until the end of the year.
We understood that major international players were looking to consolidate the market. I was put in touch with global CEOs and huge international players. We anticipated that there would be a lot of upcoming mergers and acquisitions activity in the market. It was a question of whether we wanted to be a part of that.
The answer was obvious. It made more sense to have Talabat, a company we worked so hard on growing, to be part of the changing marketplace and that’s exactly how we wanted to position the company.
Once we decided to sell, it was literally a matter of days. Again, that ties back to having the right people working for the company, and all our operational and financial systems in place. Building a quality company makes your life a lot easier when you decide to sell.
Nuwait: Was it hard letting go?
Jaffar: It was very emotional for me. I would tell any aspiring entrepreneur not to take this for granted. Like anything, you become attached to your business. You become attached to the people you work with daily. It isn’t easy to let go of that.
(Featured image via Startup Mgzn)