Along the old bullet-scarred Beirut alleys walks serial entrepreneur Brahms Chouity as he tells us his story of ventures and exits in the region’s early startup ecosystem.
After the Second World War, Lebanese emigration shifted to the oil-producing Arabian Gulf as opposed to Europe and the United States. According to historian Boutros Labaki, migration from Lebanon to the oil-producing countries reached 110,000 when the demand for manpower in different sectors of their economies gave the decisive boost to Lebanese emigration.
Kuwait was the main destination in 1975 for Lebanese emigrants, followed by Libya and Saudi Arabia. However, there was a switch of powers whereby Saudi Arabia became the largest employer of Lebanese emigrants with 97,300 in 1980, one of whom was Chouity’s father, a prominent businessman.
I build it, get it to profitability and flip it to do something else
Growing up in an upper-class household in Saudi, studying hospitality wasn’t something that Chouity’s parents were particularly fond of. However, they supported him all along his academic journey at École Hôtelière de Lausanne, in Switzerland. But by the time he graduated, he grew bored of this sector. His motivation was not to let his parents down; he had to end up being anything but a failure but he was unsure as to what his next steps would be. “I graduated, came back home, and took six months off to understand what I wanted to do,” he says. At that time - late 1990s early 2000s - there was an influx of Gulf money getting pumped into Lebanon. “Those were the golden days,” Chouity remembers.
The Beirut Broker
“I started thinking, how can I benefit from the money that is getting pumped into Lebanon, but at the same time how can I capitalise on my certificate – which was supposedly one of the best in the world.” He had the hospitality background but lacked their financials. So, he worked to get the Certificate of Management Accounting to fill this gap. He decided he was going to offer these excited Gulf investors hospitality-related investments in Lebanon. Having spent 20 years there, Chouity had the connections. “So, these investors would come to Lebanon, my dad would call me up and tell me so-and-so is coming, and that I should take care of them and show them around. And that was how I started, I started as a broker,” Chouity says.
I would start small, and within like two or three years, I became the golden boy of investments in the hotel field in Lebanon.
He would receive potential investors from the airport, take them out for lunch, show them around Beirut, tell them this could be turned into a club, this could be turned into a restaurant and so on. “I would start small; I'd broker apartments, then I would broker buildings, then lands, then selling them hospitality projects, and within like two three years, I became the golden boy of investments in the hotel field in Lebanon.”
Working as a broker grew to the point that Chouity was financially stable enough to launch an office in downtown and that was when he located himself on the Lebanese brokerage map. But slowly, his time was completely taken up by that. Clients called him at 4 AM to reserve tables for them in Paris, or get them out of trouble in Ibiza. “So, I employed someone to just take care of the clients’ lifestyle needs,” he says. “That’s when I got into the concierge business; which picked up and became a business on its own.”
Venturing into the emerging creative business
In the early 2000s, the nephew of Duchess of Cornwall Camilla Parker Bowles, Ben Elliot, an English businessman and philanthropist, came to Lebanon and asked around for someone to handle his Middle East operations. Elliot was the co-founder of powerhouse British concierge company. “So, they pointed him towards me; Quintessentially was known as the biggest lifestyle management service at that time; its clients were celebrities like Madonna and Bill Clinton, and it was the first time the company opens in the Middle East.” For the next 10 years Chouity was running Quintessentially Middle East, given his experience and exposure to the who’s-who of that sector. “This immensely grew my portfolio and thus my investment opportunities.”
Everything Chouity did always catered to the Arab world, never internationally. “Is it my comfort zone? 100 percent.” Chouity’s first company was called Hamzet Wassel, an allegory of himself being the link between the East and the West. “I look a bit foreign, I speak three languages but I had the Arab culture and know-how and I know what the taste and preferences are. And it paid off; it was much easier pleasing these guys than foreign clients.”
Within these 10 years as the manager of Quintessentially Middle East’s operations, Chouity opened over 20 different companies. “These included architecture, design, private jet companies, a motor sports racing team in partnership with a Saudi gentleman, a financial company based in Switzerland.” Then one day Chouity was watching The Social Network movie, and that’s when it hit him – times have changed. He was fascinated by Mark Zuckerbeg; thinking, who is this kid?
“Back then we didn’t have social media, so building a company wasn’t as simple as it is nowadays. I envy the youth now,” he says. The movie inspired Chouity to build a social network for Arab gamers; his first online business, At7addak.com. It became the biggest gaming website in the Arab world with 3 million users. “But I didn’t really have a monetising strategy,” he says. “You know, those days, we didn’t have a clue about online monetisation. So as soon as I monetised it I sold it to a competing gaming company.”
I didn’t know how to be a good manager. I would splurge a lot, I love spending.
And that was how it was; Chouity would never hold on to a company. “I build it, get it to profitability and flip it to do something else,” he says, explaining that he was more interested in the creation of a business than the management of a business. “I never considered myself as a good manager. Because I was too nice, I loved my employees, I took care of them, and they took advantage of me. So, I didn’t know how to be a good manager. And I would splurge a lot, I love spending.”
Gambling through the digital age
After At7addak.com, Chouity built 10 other web companies, the first of which was BidZeed in 2013; the first gaming slash gambling website in the Arab world. “That grew exponentially. I built it in three months and sold it in six months.”
At that time, neither the Middle East nor the world-wide web considered regulating online gambling; so BidZeed was technically a-legal since it was built as penny auctions. “Penny auctions is a very thin grey area between gambling and gaming,” says Chouity. Facebook allowed them to post ads, Paypal allowed them to collect money, because they were still within an area that no one litigated.
Facebook allowed them to post ads, Paypal allowed them to collect money, because they were still within an area that no one litigated.
“We were absolutely minting it, the most amazing legal way of making money,” he says. “We didn’t know how all this money was coming our way.” But that didn’t last for long. One day, Paypal wrote to the company to tell them they were freezing their account, because what they were doing had been noticed to be illegal, in spite of all the paperwork that proved otherwise. “It took us six months of litigation to get our $120,000 back,” he says. Then, Facebook followed. They sent saying that they were banning the ad system for BidZeed. That was the deal breaker, they had to secure an exit.
So BidZeed got cunningly sold to a regional competitor; who wasn’t fully aware of the shortcomings that Chouity went through. “You see in The Social Network movie, it says you don’t get the five billion friends without making a few enemies,” Chouity says. “At the end of the day, 90 percent of our business is super clean, above the table, but 10 percent of the time you are doing things that your mind might not like personally – at the end of the day you have shareholders, partners, employees, and you owe it to them to try to get the best exit possible.”
Advertising agencies weren’t doing so well, Facebook killed us
With the rise of social media and the power of the internet, Chouity saw a slump in the advertising industry. “Advertising agencies weren’t doing so well, Facebook killed us,” says the entrepreneur. “Now companies didn’t need agencies, companies could promote their brands without needing an intermediary. So, ad sales dropped.” For example, the company he runs together with his wife Tina Najjar, Shayyaka, biggest fashion concierge business in the Arab world for the past 10 years, was not doing well. “The cash was disappearing because all these companies went directly to Facebook to promote and they didn’t need us as middlemen anymore,” says Chouity. Given the situation, the entrepreneur got rid of all the online companies, and started contemplating his next goal. “Here was the pivot; I was diagnosed with cancer.”
Here was the pivot; I was diagnosed with cancer.
What was Chouity doing? Was he burning himself out, with the 60-70 flights he took every year? Those were all questions rotating around Chouity’s shocked head on his way back home from the doctor’s appointment. “I was shocked to find out about my diagnosis with thyroid cancer, I had to operate quickly so it wouldn’t spread... it’s a very dangerous area,” he says. “It was demotivating, depressing; I thought I was unstoppable, it was a completely humbling experience. It was a wakeup call; you’re going too fast, trim down. But not even that – I had to end it. Get out of everything.”
It was demotivating, depressing; I thought I was unstoppable, it was a completely humbling experience.
And so, Chouity sold his entire empire and became a stay-at-home dad. “I spent a year in the house changing nappies, making food, and raising the kids. Those were the best days of my life,” he contemplates. He figured this was what he wanted, this is what he was happy with. He'd gotten on all the magazine covers, he'd gotten the press, and he'd gotten awards and now was time for a new chapter: being a good dad, being a good husband, and giving talks. He started teaching in schools, universities, where he gave two TedEx talks. But stability and Chouity are complete strangers; he grew bored. “I was enjoying what I was doing, but I'm the kind of guy who liked to create.”
I spent a year in the house changing nappies, making food, and raising the kids. Those were the best days of my life.
Chouity loves food; spending a year at home with nothing to do except for cook and spend time with the kids revived his emotions towards cuisine. “I was a foody since the age of seven. I loved taking pictures of food. I loved watching food shows, and creating content about food,” he recalls. “So, I picked that up, and started creating content on social media.” People started liking it, sharing his content, and tagging each other. Fans even suggested that he takes a leap and turn it into a business.
A year later, DaddyFoody became a business and in fact one of the biggest food blogs in the Arab region
“A year later, DaddyFoody became a business and in fact one of the biggest food blogs in the Arab region,” he says. “Now I’m operating it like I’m running a business.” DaddyFoody is similar to an advertising agency, except that it’s personal. “So, food companies approach and ask me to create content for them.” Being a blogger gave Chouity the liberty to create honest content. “My style is witty, a little bit naughty at times. Coming into it as an independent entrepreneur, I never had limitations. That was very refreshing for brands, because that was what they needed for a change.”
Now that Chouity has scaled in Lebanon as a food blogger, his next move would be expanding in his second home, the Gulf region. “I’ll see where it takes me,” he says. “I want to be known as a household name, where people know me as a food storyteller.”
Images courtesy of @MO4Network