Entrepreneur Middle East's Achieving Women 2019: Nadine Mezher, Co-Founder and CMO, Sarwa Nadine Mezher's quest against the traditional financial industry which "was not designed to be fair."
By Pamella de Leon Edited by Tamara Pupic
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Every enterprise has a moment that sparked its creation. For Nadine Mezher, it was the realization that "the traditional financial industry was not designed to be fair. It was designed to make money for the ones that can afford it."
Mezher saw firsthand how a close relative who, after working for 40 years in Kuwait, came to Dubai to put part of his savings in MENA real estate, with the intention of investing the rest. Though it was a decent sum, Dubai-based financial advisors he consulted with expressed disinterest, and felt it was too small for their minimum requirements. "You have so many more stories like that, and you quickly realize that the story needs to change," Mezher says.
At the same time, Mark Chahwan and Jad Sayegh, both based in Canada then, were familiar with how robo-advisors were transforming the wealth industry by reducing fees and account minimums, and they noticed that the Middle East lacked access to financial services to allow everyone to invest. They started developing the idea in 2016, and contacted Mezher, who was in Dubai then, through common friends to understand the market. Around that time, Dubai International Financial Centre (DIFC) announced the launch of the region's first fintech accelerator, DIFC FinTech Hive, and that led to September 2017, when, with the support of the accelerator, they joined forces to launch Sarwa, a regulated hybrid robo-advisor in the region catering to young professionals, with a lowered minimum of US$500 to open up an account.
With the mission to change the mindset that investing is a luxury by making it inclusive and accessible, Sarwa makes investing simple and affordable by combining proven investment strategies with technology to drive down costs- meaning lessened maintenance fees and reduced minimum requirements. "We help our clients build their wealth with a personalized, low-cost, diversified portfolio and provide access to on-demand investment experts," says Mezher. The co-founders hail from a wide background: CEO Chahwan has worked in consulting for Canada's financial institutions as part of Accenture Strategy's Financial Services practice, as well as in asset management at pension fund company Caisse de depot et placement du Quebec, while CTO Sayegh brings in his experience building software systems at hedge fund Vigilant Global, ranging from cloud-based distributed services to data visualization and web applications focused on user experienced, and CMO Mezher comes from a multi-disciplinary background of consulting in retail strategy with clients including the Office of H.H. The Crown Prince of Dubai, OSN, and Nestle, as well as stints in Dubai Tourism and Commerce Marketing.
Sarwa team
Source: Sarwa
There's a certain pressure that is innate on one's path to success, and Mezher is open about pressures she has faced, especially pointing towards the Tiara Syndrome, which she defines as when "we do a job so well, and work so hard, and expect that someone will notice, and put a tiara on our heads… Unfortunately, this does not happen. You have to voice your value." Mezher also states how it's not just a culture or region-specific problem as women in businesses are currently at a minority, especially at a senior management level. "Men have more affinity with men, and unconscious bias develop out of that, and out of the values that are ingrained in us from childhood. There are certain stereotypes that society boxes us in, and we also box ourselves in.It only takes awareness to start seeing changes."
She recalls having her focus questioned as she's a mother, when in fact, she says, motherhood has allowed her to learn how to efficiently manage time and people. "I feel like I can do anything now! I used to listen to these voices. Now, I wear the fact that I am a working mom proudly, and I would not change a thing." Obstacles to success, whether due to internal or external factors, are always present, and the best thing you can do for yourself, Mezher says, is surrounding yourself with people who inspire you, make you grow as an individual, but mostly importantly, remember that you are your biggest supporter.
This personal intention of taking charge of one's continuous growth is also in evident in her enterprise- Mezher is keen to clear up people's aversion to investments, encouraging people to seek out advice and develop confidence to make better finance decisions. Sarwa's onboarding process indicates a simple procedure that determines your initial risk profile, after which you are given a recommended portfolio that is based on your financial goals and other personal factors that will be adjusted as you mature as an investor. With its fees starting at 0.85%, and 0.5% for larger accounts, and no entry, withdrawal, or exit fees, the platform allows users to have different account types -conventional, joint account, halal and Socially Responsible Investment (SRI) portfolios- and offers on demand advice with a financial advisor and customer support.
Users can also be assured of a secured account: "Since Sarwa works with a brokerage firm/custodian bank called Interactive Brokers based in the US, all accounts are insured by SIPC for up to $500,000 in cash and securities, including up to $250,000 in cash. We also use state-of-the-art security measures, are regulated by the DFSA, and are backed by top regional and international VCs."
The startup's growth is striking- they currently have around 10,000 registered users and a client database growing at a 25-30% month-over-month rate. It raised a seed round with angel investors at its inception, after which Shorooq Investments joined as a VC, followed by a pre-series A bridge round in September 2018 joined by MEVP, 500 Startups, Women's Angel Investor Network, Hala Ventures and Saned Partners, bringing the startup's total funding to over $1.5 million, according to Mezher. In the coming months, besides growing their market base, and with the lack of formal pension funds for UAE expats, Sarwa aims to work with the corporate sector to offer employees savings scheme plans and extend its offering from individuals to companies.
"We are on a mission to make investing super easy and accessible for all young professionals in the Middle East, allowing them to get expert advice and reach their financial goals, whatever they are," she says. "We're planning on going above and beyond to help them achieve their goals by partnering with leading platforms and service providers, and continue improving our products, platform, and clients' experience."
Mezher describes her entrepreneurship journey in two words: ups and downs. She comments that growth starts from focusing and building on small victories by leveraging the power of your team. It also helps to put in place proper corporate governance from the get-go, as streamlined operations can help the productivity of you and your team. To aspiring "treps, Mezher advises that it's worth looking into your industry and community when you are thinking of launching a business- similar to the support they've received from FinTech Hive.
And just like investing, Mezher advises that when it comes to business, just start. "Keep in mind though that a great idea does not necessary translate into a great business. Find an idea that you believe solves a problem, a need in the market and then equip yourself with focus, patience and a business mind that keeps you on track to implement the best practices of corporate governance."
Related: Entrepreneur Middle East's Achieving Women 2018: Raja Al Mazrouei, Executive VP, FinTech Hive, DIFC
'TREP TALK
Nadine Mezher, co-founder and CMO, Sarwa, on the most common misconceptions when it comes to finance and investing
1. "I don't have enough information. It's sounds too complicated."
"Sarwa believes in democratizing investment and making it inclusive and accessible.This is why we launched a series of educational contentthat showcases actionable lessons learned from the personal finance journeys of interesting individuals: from community icons to innovators, entrepreneurs to ambitious professionals. We also have videos on the 101 of investing and most asked questions to show how easy it is to just start.Thenear unanimousanswer we get when we ask about the reason for not investingis: "I don't know how to start.' And this is how we are tackling this.There is a lot of information in there about the dos and don'ts and it is just done in a way that speaks to everyone, and removes all the jargon and scary words that traditional advisors would use to make it sound complicated."
2. "I don't have enough money."
"Traditionally, Investment firms often required a very high minimum and came with a lot of charges that impact bottom line, such as maintenance fees, annual fees, and even account-closing fees. A platform like Sarwa allows you to start with just $500 and has an annual fee of only 0.85% of your account- and none of the other surprise charges. This makes investing a lot more accessible for new investors and seasoned investors alike."
3. "I want to wait for the perfect time/perfect investment to start."
"Waiting for the "best' time to invest is rarely a successful strategy. For investors seeking to grow wealth over the long term, the best approach is almost always to just start investing right away. Statistics and data show over and over again that no one can consistently time the market. It's not a winning game. Waiting for the perfect moment is worse than bad timing. In fact, the data shows that "badly-timed' investments in stocks are better than making no investments at all. Diversifying investment is the best strategy, whether it's your first investment or you are savvy investor. If you feel passionate about one product, or you really want to invest in your friend's idea, use a very small percentage of your savings to do so, to "gamble' with. But make sure that the bulk of your investments goes to a fully diversified portfolio.The old adage, "time in the market is better than timing the market,' holds true, and the best time to start is now!"
Related: Entrepreneur Middle East's Achieving Women 2019: Cammie Dunaway, Chief Marketing Officer, Duolingo
