“‘Son, prioritise - only spend money on what you need,’ I recall my mother often reminding during my early years,” said Daniel Solomon, a UAE-based Nigerian expat who started a business aimed at combating food wastage and bringing down fellow residents’ grocery bill by up to 30 per cent.
The advice Solomon got is what he adopted into his vocation later on. Here’s how..
An impact-driven entrepreneurial journey
With the global food waste crisis in mind, and having observed those less fortunate not have basic necessities like food, Solomon launched an impact-driven online tech startup in Dubai last year that automates discounts and brings affordable fresh groceries to conscious buyers.
EroeGo is a website where you can buy a box of fruits or vegetables at a discounted rate using artificial intelligence (AI) technology. The online platform has ties with wholesalers, farmers, and retailers, who brings produce, which may have otherwise have gone to wastelands, to your doorstep instead.
“This way, the consumers eat better, can cut their grocery bills by up to 30 per cent, but help rescue perfectly good food,” explains Solomon.
The UAE government pledged to cut down food waste by 50 per cent before the year 2030 in line with the United Nations’ Sustainable Development Goal 12 of Responsible Consumption and Production.
From being a digital project manager to a green entrepreneur
What’s the end-goal for Solomon? As an impact-driven serial entrepreneur, and founder of the first ‘ugly’ food delivery company in the UAE, he aims to create similar tech-related solutions to solve other environmental and societal problems, helping consumers and stakeholders gain awareness of sustainable practices in the process.
Having earlier worked on some digital projects, Solomon is now also the founder of a digital tech agency - Eroe Digital Agency.
“At the time of my first job as a project manager, it was about ensuring the burn report (resources) were low. This means delivering a lean project - the only money rule was never to deliver a project with a high burn rate. This is helping me now, and I think it will continue to help me in the future.”
Solomon’s experience from this business provided him great learning on preventing food waste and delivering based on their vision of making food more accessible and affordable while encouraging people to eat healthier.
“We needed to rethink the current broken food system, which leads to excessive waste. The old supply chain needed to be revisited, and doing this with bootstrapped resources meant that we faced more challenges than many early-stage startups.”
Start-up Tip #1: Lower start-up costs through government initiatives
In Solomon’s case, EroeGo is part of the ‘in5’ tech innovation centre, supporting early-stage startups since 2013, helping new entrepreneurs gain experience and nurture their ideas.
‘in5’, which has had partnerships with the Dubai Institute of Design and Innovation (DIDI) and the Dubai Design and Fashion Council (DDFC), is among other incubator and accelerator programs that help entrepreneurs fund their start-up.
They are programs of limited-duration – lasting about three months – that help start-ups during the launch stages by provide a small amount of funding, plus working space.
Incubators ‘incubate’ new business ideas with the hope of building out a business model and company.
They too assist start-ups with the preliminary stages by providing free or low-cost workspace, mentorship, expertise, access to investors, and in some cases, working capital in the form of a loan.
Both programs are similar in how they work, but while accelerator’s primary focus is to scale a business, incubators are often more focused on the business idea or how to innovate the start-up. Accelerators also aim to get start-ups ready for investment more quickly than traditional incubators.
Some examples of start-up incubators in the UAE include Dubai Technology Entrepreneur Centre (DTEC), Astrolabs (partnered with the Dubai Metals & Commodities Centre (DMCC) and FinTech Hive by the Dubai International Financial Centre (DIFC).
Some accelerators in the UAE include Dubai Smart City Accelerator, Dubai Future Accelerators, Impact Hub and the Dubai Design and Fashion Council (DDFC), and Abu Dhabi’s Flat6Labs, among many others.
Solomon said, “Business startup costs usually entail basic expenses like registering the business name and getting the business trade license that of course comes after running some trials to ensure that the business is worth pursuing. For instance, initial costs such as a trade license fee ranges from Dh15,000 to Dh34,000 in Dubai.
“When you form a company, there is also mandatory office space required. Rent for an office can cost over Dh30,000 per year. If you opt for a co-working space, you will need a minimum budget of at least Dh28,000 per year, which is a high startup cost for an early-stage company.
“As an in5 incubated company, our initial license cost was as low as Dh1,000, and we were able to lower most other costs as well. Our co-working office space was as low as Dh12,000 per year. This has been a complete game-changer, considering it would cost about 90 per cent more without in5.
“Apart from that, though, we are currently bootstrapping, so it is crucial to keep costs low at this initial stage. EroeGo is an asset-light business as a SaaS (Software as a service) platform; we still have other costs for development, marketing and sales purposes.” SaaS is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted.
Entrepreneur Tip #2: Make business purchases only in order of importance
“I prioritise all needs and make a purchase based on the order of importance. Before I buy something, I make sure that I can afford it twice over. Otherwise, it might cost me later. In that case, I find the best possible alternative to attain the goal at hand.
“We’ve learned to stay lean, and we followed the Lean Startup methodology at every step of the way. For my thought process in business, I keep my expenses low and prioritise what I need, not what I think I need.”
Lean startup is a methodology for developing businesses and products that aims to shorten product development cycles and rapidly discover if a proposed business model is viable.
It’s a scientific approach to creating and managing startups and get a desired product to customers' hands faster.
Solomon added that this helps you to prioritise quality in your professional and personal life too. “For example, I can still wear a shirt that I purchased ten years from now. So, this means it is not only good quality, but it’s also an excellent way to care for the planet.”
Entrepreneur Tip #3: Rely on research to get insight. Focus on perfecting one thing at a time.
Solomon said, for entrepreneurs, it is essential to validate your hypothesis first and research your potential audience and other stakeholders.
“Never allow anyone to tell you a problem is not worth pursuing - let data give you the insight,” added Solomon.
“Get early feedback from your users and focus on perfecting one thing instead of trying to do everything in your roadmap all at once. And, of course, make sure you enjoy the process - that is the only way you can overcome the challenges along the way.”
You’ve come up with an innovative business idea, raised initial funding, and believe you have what it takes to be an entrepreneur. What’s next? It’s time to validate your offering’s market potential.
It’s important to validate your idea early in the entrepreneurial process to ensure you don’t waste time and resources creating a product that isn’t a good fit. Securing market validation can also instill confidence among investors, crowd funders, and banks that are considering funding your startup.
By going through the process of validating your business idea, you can gain a deeper understanding of how your product does or doesn’t meet your target customers’ pain points. The insights you gain can help you create an offering that not only addresses your market segment’s needs, but earns you your first paying customers.