UAE: How three women-led start-ups were launched bootstrapped and sustained the pandemic
Many entrepreneurs launched their start-ups, albeit by bootstrapping and overcoming odds
Highlights
Even as the COVID-19 pandemic challenged and stress-tested businesses, three UAE-based women-led start-ups not only bootstrapped, launched and sustained 2020 but have set plans for future growth.
Dubai: From transforming business models to rejigging processes, 2020 was a watershed year in many ways posing unforeseen challenges, at the same time pushing entrepreneurs to think differently. Many entrepreneurs took the leap of faith to launch their start-ups, albeit by bootstrapping and overcoming many obstacles.
Making books more accessible
Friends and now co-founders of Bookends, an online platform for pre-loved books, Grace Karim and Somia Anwar were keen to find a cost-effective solution to encourage people to read more by giving them access to a wide range books at an affordable cost.
As buying full-priced books is often an expensive affair, a few years ago they decided to collect pre-loved books from friends and family to re-sell them. Priced as low as Dh5-10, these pre-loved books sold quickly, often making Dh1,000 within a couple of hours from each table top sale at festivals, schools and nurseries.
“Seeing the traction, we thought of setting up a small business to sell pre-loved books, but the upfront investment to rent a place, logistics of picking up and storing books and the time required prevented us from going ahead at that time. Plus, we had to give the largest chunk of the sales to the sellers retaining a bare minimum that did not even cover our cost to rent tables, print cards etc,” the co-founders expalined.
In 2019 the duo heard of and entered a competition led by Sharjah Entrepreneurship Center (Sheraa), inviting innovative ideas around books and publishing, winning the third position and Dh25,000 of seed funding (initial start-up investment).
This was a pivotal point for the start-up’s future as alongside the prize money, Karim and Anwar decided to invest Dh25,000 each from their savings to finally start Bookends in March 2020.
“We registered the business with Sharjah Research Technology and Innovation Park at a special rate of Dh3,000 offered to Sheraa incubatees (entrepreneurs) and set up the e-commerce site on Shopify against a $30 (Dh110) monthly fee that has now increased to $100 (Dh370) due to additional features.”
Bookends’ initial repository of 250 books has now gone up to 8,500. The business model remains the same where a seller is given the largest share of the proceeds. If a seller asks for Dh10, the book is listed at Dh15 whereby on selling they receive Dh10 and Bookends retains Dh5 as service charge for checking, sanitising, curating, storing and delivering the books. “The commission is not enough, but we are trying to first spread awareness to encourage people to buy pre-loved books and eventually play in volume terms.”
Was launching a pre-loved concept during a pandemic a brave decision?
“In the beginning, we were apprehensive if these pre-loved books would be safe for handling,” the co-founders admitted, “but we sanitised them thoroughly over at least 72 hours before even curating them online. To our surprise, as people stayed at home there was a high demand for books, and Bookends appealed to them due to our affordable pricing.
“From July-August 2020 onwards, we have seen a minimum 5 per cent month-on-month rise in sales and our active customer base has increased by 4,000, 30 per cent being repeat visitors. Around 100-200 books are being added and sold on the platform daily.”
From July-August 2020 onwards, we have seen a minimum 5 per cent month-on-month rise in sales and our active customer base has increased by 4,000, 30 per cent being repeat visitors
The pandemic also financially supported Bookends’ growth as the start-up received a grant of Dh25,000 from the Bank of Sharjah. In addition, Sheraa launched an initiative to support start-ups and Bookends received $10,000 (Dh36,700).
“Coupled with small amount of personal funds that we inject into the business every month; the relief measures have helped us to financially sustain and even accelerate the future roadmap to increase our repository and sales three times within a year. We are keen to deploy a customised software to better curate the books, employ more people and eventually expand to countries like Saudi Arabia. Our goal is to encourage reusing pre-loved books and help interested people to donate their books to support charities.”
Passion leads to a profitable business
Serial entrepreneur Vijita Moray combined her passions interior design, art and love for animals to launch Furnature, a UAE-based online customised pet furniture concept. Having lost her father last year, who was an animal empath, Moray felt a genuine urge to create an animal-centric concept in his honour.
“Being a designer and a pet owner, I have been creating various pet furniture and products such as dog beds, toy boxes, food stands, scratch poles for cats and more for my own pets. Even before launching Furnature, I would put aside Dh1,500 to Dh2,500 from my day job salary to buy materials to create these prototypes, which caught the attention of our friends and family. From time-to-time they asked me to create products for their pets,” Moray said.
“Finally in March 2020, my husband decided to get a trade license from the Department of Economic Development (DED) to formally launch Furnature. Even before creating an e-commerce presence, we started receiving enquiries after I posted some images of the prototypes on Instagram. That drove us to hasten the launch of Furnature on Zbooni, a social commerce platform that supports microbusinesses, charging 3.5 per cent commission on every sale.”
The timing of Furnature’s launch was tricky and opportune at the same time. As the family’s interior design business suffered severe losses due to COVID-19 related challenges to the point of shutting down the workshop, Furnature was launched in July 2020.
Even before launching Furnature, I would put aside Dh1,500 to Dh2,500 from my day job salary to buy materials to create various pet furniture and products.
Furnature helped Moray to pivot by utilising the workshop that was lying empty, yet they were paying Dh6,000 as monthly rent. With an initial investment of roughly Dh15,000 to Dh20,000 including monthly workshop rent, materials worth Dh5,000 and salaries for part-time carpenters the business took off.
“Our first order from Abu Dhabi fetched us Dh8,400 for a big dog crate and a cat tree. Since then, we have created furniture for pet day care and boarding facility Urban Tails and pet-friendly resort Al Jazira Ghantoot Villas, among others. We have also received orders from the Zabeel Palace and are a registered pet furniture supplier to another Abu Dhabi-based royal palace,” Moray shared.
Since launch, Furnature has received positive response with “no lean period”, leading to almost 50 per cent rise in sales from the first quarter of operation, generating a steady monthly income of Dh15,000 on an average. A loyal customer base helps Furnature register 30-40 per cent repeat orders. Currently individual orders account for 85 per cent of sales and corporate orders for the remaining.
What were the challenges of launching a start-up amid the pandemic?
“As a start-up we have faced financial challenges but 15 to 20 per cent consistent savings from my day job helped us to tide through. I have learnt about pricing principles by accounting for overheads and other associated production costs.
"Until recently, I would sell the items at production cost. I have also realised how economies of scale can be achieved through an efficient production process. During the initial months, I used to purchase materials based on orders and then create the products, which turns out expensive. Now I buy materials in bulk to produce multiple pieces simultaneously and customise based on orders, which has helped us to diversify our offerings and thus we are selling more.”
“Going forward, I am considering fund raising to expand product manufacturing, create a dedicated e-commerce website and even streamline the delivery process.”
Furnature also supports animal charities in the UAE by donating proceeds from art and craft workshops to create pet products. “We also donate a portion of our income to animal charities.”
Side hustles to launch a business
Offering bespoke streetwear made from sustainable fabric digital fashion start-up Non Iridescent launched in the UAE in July 2020. As people turned to online shopping, the brand launched at an opportune time helping Non Iridescent sell over 30 items in the first month itself. However, the brand has seen peaks and troughs is sales. In October there was a downward spiral, while sales increased during Black Friday and 33 per cent around Ramadan and Eid Al Fitr in 2021.
It took a few years of conscious saving for co-founders Sabrina Sherif and Danni Staats to launch Non Iridescent at an initial investment of approximately Dh60,000. The biggest expenses included initial sampling and procurement of fabric (accounting for 40 per cent of the investment), getting the trade license (20 per cent) and aggressive marketing campaigns to build brand awareness (40 per cent).
On the other hand, they saved at least Dh20,000 by creating the e-commerce website on their own, integrating the payment gateway using 2Checkout that charges 3 per cent commission per transaction. By doing video production and social media campaigns in-house, they saved anywhere between Dh3,000 and 10,000 per month, while spending Dh5,000 to Dh8,000 on Facebook and Instagram ads. “Three months of active social media campaigns helped us to gain brand awareness and significant sales traction,” Sherif shared.
Elaborating on their side hustles, Sherif added, “Along with our full-time jobs, we started taking on consulting projects for digital marketing from 2019 to gather the initial investment. Our monthly savings from these projects would range between Dh3,000 and Dh10,000. In a year, we managed to save enough to start our business.
Along with our full-time jobs, we started taking on consulting projects for digital marketing from 2019 to gather the initial investment.
Besides ploughing back income from the business, we continue taking on consulting projects sporadically that helped us to save Dh12,000 in the past two months for future investment. Even before starting Non Iridescent we were clear that the business would need a couple of years to become profitable. Until then, we will have to invest to grow the business. And depending on the product, a brand’s monthly marketing budget alone could range between Dh2,000 and Dh8,000.”
Was there a financial setback due to the pandemic?
“The pandemic related capacity restrictions added some extra costs on things like photoshoots, paperwork and getting COVID-19 tests done as required. At the same time, we have received preferential rates for licencing from DED as well as reduced warehouse rent, as the UAE committed to supporting start-ups and SMEs (small and mid-size enterprises or businesses). More than the pandemic, we have incurred considerable financial losses of almost Dh5,000 due to a ruined video shoot and supplier related challenges. Every such situation adds to the cost of running a start-up.”