Success stories like Careem and Etihad have as much a social as an economic impact
Value of home-grown UAE companies goes beyond bottom lines
When Magnus Olsson and Mudassir Sheikha quit their jobs to start ride-sharing platform Careem in 2012, Uber was busy spanning the world, ready to break into Australia and reach a $330 million valuation. Today, Careem is worth more than $1 billion.
While Uber's value was estimated at $72bn in February, Careem and other UAE home-grown enterprises – including airlines Emirates and Etihad Airways and hotel operators Jumeirah and Rotana – offer something which even the most successful international players cannot: a genuine understanding of the region, its people and their needs.
The value of that goes beyond what an investor might pay for a company.
Etihad in particular has shown the importance of its roots since it launched in 2003. With its vision to outclass its competitors and connect the globe via Abu Dhabi, its growth has already had a huge impact on the lives of people in the UAE and the wider region.
Careem is also hoping to provide greater freedom and control for its customers in the many markets in which it operates. These are noble aims that have a social value that is increasingly rare in global players – particularly if a large investment needs to be justified in bottom line terms.
For both Etihad and Careem, rapid early success is now giving way to more mature phases of operations. For Careem, this means comparisons with Uber. The choices its management make at this stage will have reverberations for the region’s start-up scene as a whole.
Partnerships and tie-ups with global brands such as online retailer Souq’s acquisition by Amazon, present huge opportunties. So too does continuing to build independently. Perhaps for Careem, being taken seriously by Uber could be a springboard for it to compete with it globally, beyond the Middle East and south east Asia.
Similarly, Etihad, which is coming through a challenging period for commercial aviation in the region, sits at a crossroads.
Group chief executive Tony Douglas has set out an ambitious and expansive plan to create more partnerships with other airlines around the world and to grow its point-to-point network which will provide greater opportunities for it and Abu Dhabi’s tourism sector as a whole. Mr Douglas’ proposal to use technology and digital tools to improve passenger experience also could give it a competitive edge.
As always, its identity as an Abu Dhabi airline will be at the heart of whatever steps it takes.