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Paying It Forward: Elias Ghanem, Co-Founder And Chairman, Telr With a ringside seat to the daily struggles and victories of the region's entrepreneurs, Ghanem is perhaps the best person to shed light on factors that stand in the way of the region's startups achieving scale and making it big.

By Sindhu Hariharan

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Elias Ghanem
Elias Ghanem, co-founder, Telr and Resident Mentor, UK Lebanon Tech Hub.

Ask Elias Ghanem to offer his insight on what it's really like to be an entrepreneur, beyond all the apparent glitz and glamour, and he doesn't mince words. Describing the process of starting a company to be akin to "having a baby," the entrepreneur explains how drastically life changes, and how there's no end in sight to the hustling. "Ask any mother how difficult but rewarding it is to have a child, and there you go," he says.

Ghanem started his career with leadership roles in payment giants like VISA and PayPal, and was a key force in launching PayPal in the MENA region, which he helped run for almost two years. It was during his tenure at PayPal that several large merchants were brought on board, with the service also launching in Egypt during that period. But after realizing that the MENA economy needed a more "hands on, home-made" payment solution capable of handling specific local aspects, Ghanem left PayPal to found Telr (derived from the word teller), an emerging markets-focused online payment gateway. "That [the realization] was the moment of truth [for me] to leave PayPal and try to do something on my own," says Ghanem. In a short span of time, Telr was able to do a lot: raising funds across the MENA and Asia, acquisitions and corporate partnerships, as well as winning accolades in the region's ecosystem. Telr operates as a single window e-commerce solution- facilitating secure online payments through their gateway, enabling creation of e-commerce stores through their "Store Builder" solution, and also supporting cash flow of SMEs through a merchant advance system. Telr's platform also enables businesses to manage payments through the web, mobile and even social media accounts- small wonder then the company was awarded the title of "Best Payments Product" at The Asian Banker's second Annual MEA Awards in 2015.

But Ghanem's innate desire to constantly build new solutions prompted him to move on to a mentoring role at Telr (taking up the role of Chairman) in just over a year of founding the company. Ghanem says that the huge progress made by Telr in such a short time was his cue for the move. "It was a wake-up call telling me, 'You have done a lot in a single year, had to let a lot go, so get yourself back a life, and focus on what you like,'" he says. And what Ghanem went on to do next is a clear reflection of what he's most passionate about. With a fierce focus on growing the region's entrepreneurial community, Ghanem put on his advisory cap, taking on the important task of mentoring various small businesses across the region. Desiring to "dedicate 2015 to coaching," Ghanem became Chairman of Zoomaal (a leading crowdfunding platform in MENA), a board member in Bridg (a smartphone payment platform using Bluetooth), as well as in Paykii (a solution for cross-border bill payments). He also became a Resident Mentor at the UK Lebanon Tech Hub, an accelerator representing a joint effort on part of both countries to foster innovation. And it doesn't end there- Ghanem is also an investor always on the look out for ventures disrupting traditional payment systems.

Image credit: Telr.
Related: MadfooatCom Envisions Cashless Payments For Jordan And Rest Of MENA Too

With fintech being at the center of the funding and innovation action in the global entrepreneurship scene, the sector is making tangible progress in developed economies, but it's safe to say that the role played by technology in financial services industry of emerging markets leaves a lot to be desired. Ghanem seems to agree with this popular thought when he says that fintech is at its "infancy stage" in the MENA region. Discussing the current and future prospects of the region's fintech space, Ghanem opines that it still remains a habit and quite common in the region to go to a physical branch to carry out transactions, despite emergence of alternatives. "Digital signature is struggling to become mainstream, banking apps only offer very basic services, and very few banks are adopting the fintech wave," he says. Talking about global banks setting up in-house accelerators to develop solutions, Ghanem praises Emirates NBD and its recent fintech challenge, which seems to be leading the change among MENA banks to institutionalize support for fintech entrepreneurs. He also lists various areas where MENA's fintech entrepreneurs could make a mark, including opportunities to set up a fully digital bank, online payment gateways, and promoting "financial inclusion for the millions of unbanked," among others. Analyzing the geographic reach of fintech among the region, Ghanem says that Dubai is clearly leading the way, and Egypt too presents great potential "thanks to its local critical mass." He is, however, most excited about Iran, where "fintech is definitely making fast progress." With so much going in favor of fintech startups in MENA, what then stands in the way of a fintech wave in MENA? There are two key hurdles, according to Ghanem. "The single largest challenge is customer KYC (Know Your Customer) that remains very antique in MENA, as there is no national ID number with a proper credit bureau," he says. As explained by Ghanem, this creates a need for customers to go in person to the bank and provide several documents to be stamped, notarized or checked. The other challenge is a lack of regulatory framework or acceptance of digital signature, which remains a significant hurdle for fintech to gain steam in this region.

With a ringside seat to the daily struggles and victories of the region's entrepreneurs, Ghanem is perhaps the best person to shed light on factors that stand in the way of the region's startups achieving scale and making it big. "Cash, talents and co-working environment," says Ghanem, responding to the question. Though VC money is growing, he says that it seems to barely reach entrepreneurs, especially "at seed stage before launch," and sees it as a chicken-and-egg problem, where investors demand to see "traction," and founders need cash to show any traction. "VCs in the region are either ex-bankers or wanna-be bankers, they are greedy, unfair and not risk takers (of course there are great exceptions to that statement), they over negotiate terms, kill any valuation, highly dilute the entrepreneurs, delay forever cash payments, and barely educate entrepreneurs about term sheet components," laments Ghanem. Founders need to let go a lot of their freedom and must accept that increasingly deals are being shared, and co-investment is becoming common, he adds. However, he admits that not all parts of MENA suffer from the same drawbacks. Dubai-based investors, he says, are doing a better job in educating entrepreneurs and taking risks. Similarly, he believes talent is scarce in the region and is distributed in an "unbalanced manner" and considers coworking spaces as essentials to foster creativity, where entrepreneurs from diverse backgrounds can work together. But Ghanem does not hold back from also pointing out mistakes he notices entrepreneurs making in formulating their business models. "Please don't try to build a business model on your own [as entrepreneurs], but rather surround yourself with people who know how to do it," Ghanem advises founders. He urges the region's entrepreneurs to stop chasing "shiny objects"- a problem he finds common to emerging markets and go after real solutions even if they require taking risks. Tendencies to go for a high valuation early on, building businesses alone leading to a "failure rate [which] is exponential," and "offering the co-founder title to anyone," are some of the red flags he observes in the business model of upstarts today.

Drawing from his own experience, the fintech evangelist is a firm believer that a stint in the corporate world guided his business management strategies. "I think Telr would not have been where it is without our [team's] collective corporate background," he admits, attributing Telr's success to "business processes, credibility and the network" that the founders acquired during their days in the corporate world. Ghanem is also candid in offering his thoughts on what the region's entrepreneurs lack from an execution point of view: a partnership spirit. "Entrepreneurs in this side of the world tend to keep their idea to themselves, rather than looking for partnerships, collaboration, mergers etc.," he says. And what is the one thing he would like to drill into the entrepreneurs he works with? He chooses to offer hustlers a reality check on entrepreneurship, warning them that they are getting into an "emotional roller coaster." "You'll be drained, as emotions goes every minute to the roof or down, depending on if you have an article in a magazine, or if you read your competition has done a better product... This is the glamorous life ahead of you," he warns, matter-of-factly.


Elias Ghanem

Elias Ghanem, co-founder and Chairman, Telr. Image source: Elias Ghanem.
Startup shout-outs

"I like entrepreneurs that solve problems and impact millions of people. I am a huge fan of four entrepreneurs that run two startups. [First] Bridg- run by two young guys, Moussa Beidas and Nadim Jarudi, who decided to disrupt the old fashioned "point of service" device that should go to museums anytime soon. [Second] Paykii- run by Fabian Saide and Nelson Irizarry, who, decided from Washington and Mexico, to help all migrant workers pay bills in their home country from their working place. MENA is the second largest host of migrant workers, and Paykii has already signed agreements with several money transfer and bill payment aggregators in MENA, Asia, LATAM and the US."

Advice for aspiring entrepreneurs

"[Firstly,] be aware that entrepreneurship is 1% glamorous and 99% insanely difficult. [Second,] be willing to invest the double of your last yearly income with a 90% risk of losing it all. [Finally,] don't go alone to the toughest work in your life, surround yourself with more prepared people. Be aware that corporate life (including startups) is a jungle, and trust is always a factor that evolves very quickly. If you start alone, wait to give the 'co-founder' title until you really trust your partner."

Tips for entrepreneurs raising funds

"Investors want to hear a story that makes them dream. It's not about you; it's about the problem you are solving. Keep it short, sharp, precise. Your background is only useful to give credibility (we don't care who you know, where you lived, or where you got your first diploma). Don't pitch if you are not ready- rehearse, rehearse, rehearse before pitching."

Related: Surging Ahead: Fintech Startups In The Middle East

Sindhu Hariharan

Former Features Editor, Entrepreneur Middle East

Sindhu Hariharan is the Features Editor at Entrepreneur Middle East.  She is a financial consultant turned business journalist with a FOMO when it comes to everything technology.

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