Dubai: For Sharjah-born Emirati entrepreneur Khaled Al Harmoudi, 33, it was unfortunately only after he lost an enormous amount of his hard-earned savings, he truly learnt that it’s only worth investing your money in a business if you have a clear understanding of its potential and growth prospects.
"I took a considerable risk investing Dh200,000 in my friend's company to support his cosmetics business, and one year later, the company failed,” said Al Harmoudi, citing that “there wasn’t enough funding and investors didn't want to invest in it because the market has a lot of cosmetic brands."
Al Harmoudi, whose entrepreneurial journey started in 2018, has since witnessed multiple failures and successes. He is currently based in Dubai, but his childhood was spent between Dubai and Abu Dhabi as his family moved cities when he was young.
I took a considerable risk investing Dh200,000 in my friend's company to support his cosmetics business, and one year later, the company failed
Being an entrepreneur despite no money habits
As a child, Al Harmoudi’s parents would give him and his siblings Dh5 or Dh10 about once a week. But even though that was enough to satisfy them as kids, he admitted not developing any good saving or investment habits led him to make mistakes later on in his career.
However, after relocating to the US for about seven years to complete his higher education and degrees in engineering and quantum physics, he learnt to make decisions independently based on his surroundings, critical thinking and time management – all pre-requisites to be an entrepreneur.
Graduating with a double major in mechanical engineering and engineering management, with a minor in quantum physics, Al Harmoudi went on to share how living in another country away from his family was a challenging experience.
"I would divide my income into three categories, bills, food and groceries, and savings. I was a government sponsored exchange student and received a monthly allowance of Dh6,612 [$1,800]. I maintained my expenses with that money and would not take anything from my parents," he added.
Developing leadership skills in the energy sector
Al Harmoudi got his first job in 2015, when he worked as a project engineer in an Abu Dhabi-based oil and gas company and received Dh50,000 as his salary. Over the next seven years, he was able to develop his leadership and communication skills while working at the firm.
"My job was to build platforms and rigs for oil wells, and the project's budget consisted of up to $4 billion [Dh 14.69 billion]. Working at that job as a project engineer is considered a high-risk field with plenty of health risks. I was unfulfilled in that role and wanted a career change," he said.
Al Harmoudi went on to quit his job in 2021 to go full-time into his business. "I realised I couldn't have a full-time job and run a clinic that dedicatedly requires more than eight hours of my day. After quitting the oil and gas industry, I worked full-time as a clinic owner."
He began two businesses, a polyclinic in 2018 and another compounding pharmacy in 2022. He was the first UAE national to launch an accredited compounding pharmacy. While compounding pharmacies are common in the US, in the UAE this speciality pharmacy is the first of its kind.
A polyclinic is a health care facility that provides both general and specialist examinations and treatments for a wide variety of diseases and injuries to outpatients and is usually independent of a hospital. When a polyclinic is so large that it is in fact a hospital, it is also called a general hospital.
How did you manage to fund your healthcare businesses?
Al Harmoudi said, "No one believed I could run a polyclinic. I didn't have any financial support from my family or friends. It took me two years to fully start the business with no investor or partner."
Initially, he invested Dh1 million from his savings and borrowed money from the bank. “I didn't make use of any unique way of saving, but I was prudent about where to spend my cash," he added.
"I used a professional accountant to manage the flow of cash into the company and the company spending. Most of the medical equipment was on the lease, which saved me some funds instead of buying in directly."
Establishing a medical facility, especially with no moral or financial support, wasn’t an easy journey for Al Harmoudi. "I put every penny I had into this business. Sometimes I would have less than Dh50 in my pocket to survive the week.
“It would be helpful to have a medical background to open and operate a medical facility, but I didn’t have one, which led to extra expenses. The cost increased by 30 per cent, around Dh550,000, for purchasing modern pharmaceutical machines."
Tip #1: Use your own money or invite investors to fund your business instead of bank finance
Al Harmoudi got into debt when he started the business due to his inexperience and mistakes made; then, he worked hard to market the clinic services and made a good profit that helped him settle his debt.
Initially, he had trouble recruiting doctors and nurses. The pandemic made things much worse for him and his already limited-funding situation. But by the end of 2021, business at polyclinic started to pick up and it became profitable. Profits also helped him fund the pharmaceutical company.
"I learnt that borrowing funds from a bank can set you back and is something I always avoid now. Therefore, I realised that whatever I venture into in the future, I should use my money or invite investors and partners to help fund it."
No one believed I could run a polyclinic. I didn't have any financial support from my family or friends. It took me two years to fully start the business with no investor or partner
What was your experience in setting up a compounding pharmacy?
"Compounding pharmacy is a very delicate and skilled domain. The investment in this business was Dh5 million to start it up, and it was enough to open one section of the project. Later, I had to add Dh10 million to reach the business’ total capacity," he added.
With speciality hospitals popping up nationwide, Al Harmoudi opined that speciality pharmacies are also now essential to cater to everyone's medical prescription needs since everyone's body reacts differently to medicines.
Tip #2: Do not rush into new ventures where you lack experience
"I have opened two businesses. I have succeeded in many areas of business and failed in others. I failed to set up a cosmetic company five years ago because I did not study the market correctly and who my competitors are,” said Al Harmoudi.
“However, on the bright side, I've also learnt to trust my gut more. I’ve second-guessed myself so often in the past, only to discover that my initial thoughts about a situation were correct. It's essential to consult with other professionals on situations, but most importantly, Trust Yourself!"