PM — Net-zero plastic industry by 2050?

It’s shaping up to be a news dump day-type of hump day, friends, as we push through a rather busy week.

THE BIG STORY TODAY

Egypt is getting a USD 3 bn top-up from the International Islamic Trade Finance Corporation to help cover our ballooning wheat import bill, Supply Minister Ali El Moselhy told El Hekaya’s Amr Adib (watch, runtime: 3:08). The agreement doubles the amount of funding the ITFC is making available to Egypt to pay for our wheat and oil imports.

^^We’ll have more on this story and others in tomorrow’s edition of EnterpriseAM.

THE BIG STORY ABROAD

It’s a thoroughly mixed bag of nuts in the global press this afternoon. Reuters and the Wall Street Journal are leading with Russia’s push to encircle Donetsk and Luhansk in Ukraine’s eastern Donbas region, while the Financial Times’ top story is Hungary’s refusal to budge on its opposition to a Russian oil embargo. Elsewhere, Bloomberg reports that Saudi’s Power and Water Utility Co. for Jubail and Yanbu (aka Marafiq) has tapped HSBC Holdings Plc and Riyad Capital to quarterback its planned USD 1.2 bn IPO.

HAPPENING NOW- It’s day 2 at Davos, with global business, policy and media chiefs talking about everything from global tax and the future of work, to the digital economy and all things climate.

Highlights from day 1:

• The prospect of economic weakening and full-on recessions appeared to be on the global leaders’ collective radars, with political leaders and analysts suggesting that the economic outlook has “darkened,” but recessions are only probable at this point in “weaker economies,” IMF boss Kristalina Georgieva said.
• Crypto still doesn’t have lots of fans, with Georgieva saying, “BTC may be called a coin but it's not money. It’s not a stable store of value.” Central bankers echoed the IMF boss’ sentiments, saying cryptocurrencies aren’t “real” yet.
• Plot twist: The rich want to be taxed. Mn’aires at Davos called on governments to tax them to address the “cost of living scandal playing out in multiple nations around the world” and narrow the gap between rich and poor.

---

** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

• Are international car brands cutting Egypt out of their short-term export plans? Both Al Borsa and Al Mal are reporting that as many as eight international auto companies have stopped exporting cars to Egypt on the back of Egypt’s decision to move importers to letters of credit instead of the longstanding process of documentary collection to import goods.
• Egypt Education Platform enters pre-K sector with acquisition of two preschools: Education management firm Egypt Education Platform (EEP) will acquire a majority stake in Montessori preschool chains Trillium and Petals.
• Saudi healthcare group looks to enter Egypt by acquiring New Cairo hospital: Saudi Arabia’s Mouwasat Medical Services has signed a non-binding MoU to acquire 100% of Al Marasem International Hospital in an all-cash transaction

---

DID YOU MISS THIS WEEK’S WHAT’S NEXT? Last month, we explored how the government has made artificial intelligence a national priority. We spoke with the former ICT Ministry’s advisor for AI Sally Radwan about the government’s national AI strategy and how it is being implemented (Part 1 | Part 2). In another of our virtual podcast roundtables, we sat down with the companies building AI systems in Egypt to get a bird’s eye view on what’s happening in the sector: Who’s adopting it, how they’re going about it, and what challenges they’re facing.

You can catch the episode on our website here (listen, runtime: 44:01), or tune in via Apple Podcasts | Anghami | Google Podcasts | Spotify). Or you can read edited excerpts of our conversation here.

Subscribe to Enterprise

???? CIRCLE YOUR CALENDAR-

The inaugural edition of FIN Expo Egypt is kicking off tomorrow and will run until Thursday at the Intercontinental Citystars. The expo — organized by UAE’s HQMENA — will feature over 25 companies exhibiting their fintech products and services with 3k visitors expected.

El Gouna International Squash Open 2022 will kick off on Friday and run until the following Friday, 3 June. The competition will feature some of Egypt’s top seeds including world #1 Nouran Gohar and world #2 Ali Farag (who just earned the PSA squash championship cup). The prize pool for each of the men’s and women’s competitions is USD 180k.

☀️ TOMORROW’S WEATHER- Expect a daytime high of 36°C tomorrow before the mercury falls to 20°C at night, our favorite weather app tells us.

***
WE’RE LOOKING FOR SMART, TALENTED PEOPLE to help us build some very cool new things. Today, we run two daily publications, five weekly industry verticals, and a monthly newsletter designed to make our readers feel just a bit smarter.

We have tons more in the pipeline — come help us build new publications. We offer the chance to work in a fast-paced newsroom on a broad range of topics and in a variety of formats. Our goal is simple: To create value for our growing community of 200k readers by telling stories that matter.

We’re looking for editors who want to run publications and teams, editors to help reporters craft stories and talented reporters. Egyptian and foreign nationals alike are welcome to apply. So are job-switchers: If you’re an equities analyst tired of the rat race, we’re a great place to come work.

Apply directly to jobs@enterprisemea.com and mention Patrick in your subject line.

Or hit this link for more information. It’s worth it — trust us.
***

Green funds are about to get a lot more transparent as the US Securities and Exchange Commission (SEC) prepares to crack down on investment funds that claim to be “ESG,” “sustainable,” or “low-carbon,” the Financial Times writes, citing people familiar with the matter. This comes as sustainable funds continue to ride a high, which pushed their assets to a combined USD 2.77 tn over the last quarter, up 177% from 2019. “There is currently a wide range of what asset managers might mean by certain terms and what criteria they might use,” SEC chair Gary Gensler previously said. Yesterday the SEC announced a USD 1.5 mn settlement against BNY Mellon’s investment adviser division over allegations of misstatements and omissions about ESG considerations.

The plastics industry could be net-zero by 2050 — but not without significant investments: Some USD 795 bn is needed in order for the plastics industry to reach net-zero emissions by 2050, a report from Bloomberg NEF — Bloomberg’s clean energy research arm — shows. Decarbonizing the industry will require massive investments because it takes addressing the emissions of both its chemical feedstocks — like petrochemicals — and its actual production to reach net zero. That involves the electrification of plants that break down natural gas into small molecules needed to make plastics, building out carbon capture and storage facilities, the shift to biofuel, and research and development.

These investments need to begin before the end of the decade if the industry plans to hit the target by 2050, according to the report. This comes as plastic production is forecast to grow at 3% every year, as the oil industry puts its money on the industry amid the decline of most traditional uses of fossil fuels.

???? ON THE TUBE TONIGHT-
(all times CLT)

One of the craziest films we’ve seen that surprised us with how much we enjoyed it: Everything, Everywhere All at Once is a sci-fi absurdist drama that has a Marvel-esque multiverse theme. The film follows a Chinese-American family consisting of Evelyn and Waymond, and their daughter Joy. The family runs a struggling laundromat that is being investigated by the IRS — which is just one of the problems plaguing the main character Evelyn. Here’s where things get weird, with her husband from another universe showing up to seek her help to save the world from a shocking villain. This sparks the beginning of a crazy adventure that takes the characters to different bizarre universes to defeat the villain. Don’t let the randomness fool you — the film is full of metaphorical and at its core explores themes of love, family, and friendship.

⚽ No kora for you all today.

???? DRINK THIS TONIGHT-

Zenzoo takes Taiwanese bubble tea to new heights: Located in Sheikh Zayed’s Walk of Cairo, the recently opened bubble tea shop offers a ton of flavors for the iconic drinks. There’s more to choose from than just tapioca, with the choice of jellies, poppings, and aloe vera as wonderful surprises in your cup. You can also choose flavors such as mango island, pink lemonade, matcha, hibiscus, black tea, and green tea. For a fun snack, Zenzoo offers a selection of mochi ice cream balls in vanilla, chocolate, mango, yogurt and blackberry, and more.

???? OUT AND ABOUT-
(all times CLT)

Cairo Cinema Days 5 is kicking off at Zawya Cinema tomorrow: The initiative features films which premiered at regional and international film festivals over the past year in efforts to showcase Arab cinema. The Cairo Cinema Days is a chance to see the latest feature-length productions to come out of the Arab world and its diaspora, with films out of Egypt, Palestine, Lebanon, Iraq, Algeria, Morocco and Tunisia.

This year’s edition of the Breaking Walls Festival looks at “arts in the age of climate change”: The festival will take place tomorrow at the Italian Cultural Institute, with the program including a live performance and a panel discussion on art and climate change. The speakers of the panel are: theater performer Sarah Rifaat, Greenish Brand Manager Alaaedeen Tawfik, and Hazem Header, the art director for NÜT Dance Company as well as the Breaking Walls Festival.

Marwan Pablo is performing tomorrow at Cairo Jazz Club 610 at 9pm.

???? UNDER THE LAMPLIGHT-

A sinister story that begins with a young boy’s drawings: Hidden Pictures by Jason Rekulak follows Mallory who escapes a dark past and begins a new life as a live-in babysitter for five-year-old Teddy. She enjoys the calm and stability the job gives her and she enjoys shy and sweet Teddy’s company. However, one day Teddy’s drawings of trees and flowers turn into a drawing of a man dragging a woman’s lifeless body. From there, Teddy’s artwork becomes increasingly sinister and his stick figures quickly evolve into lifelike sketches well beyond his ability. Mallory is thrown into the midst of what she suspects is a supernatural phenomenon that hints at an unsolved murder.

EARNINGS WATCH-

Egytrans turned to the black in 1Q2022, recording a bottom line of EGP 3.17 mn compared to EGP 20.05k in net losses in 1Q2021, according to Egytrans’ financials (pdf). Revenues also rose 64.8% y-o-y in 1Q2022 to EGP 94.29 mn.

TMG Holding saw its bottom line increase 27% y-o-y in 1Q2022 to EGP 553.98 mn, the company said in an EGX disclosure (pdf) today. Revenues also rose 12% y-o-y during the quarter to reach EGP 3.02 bn.

MARKET ROUNDUP-

The EGX30 fell 1.0% at today’s close on turnover of EGP 609 mn (28.1% below the 90-day average). Foreign investors were net sellers. The index is down 12.9% YTD.

In the green: Rameda (+3.7%) and Oriental Weaver (+0.3%).

In the red: Ibnsina Pharma (-7.0%), Palm Hills Development (-5.9%) and Orascom Construction (-5.1%).

OUR FOUNDER OF THE WEEK- Ahmad Yousry, co-founder and CEO of Rabbit (LinkedIn).

My name is Ahmad Yousry, and I’m the CEO and co-founder of Rabbit. I would say the first pivotal moment in my professional career was when I applied for a networks engineering position at Vodafone Egypt. As a result of the interview process, Vodafone’s HR team felt like I was a better fit for a position in their marketing department. I still don’t know why [laughs], but that decision changed my professional career entirely. I spent nine years working at Vodafone’s Egyptian branch, learning a lot about the ins and outs of marketing, before moving to the UK to head the company’s CRM center of excellence for Southern Europe, Africa, and Asia.

My role entailed a lot of traveling. I used to be on the road for 27 days of the month, and it was through this I fell in love with Uber and with technology’s ability to solve real-world problems. When I moved back to Egypt, I was lucky to land a job as Uber Egypt’s head of marketing, and after working a number of positions at the company, I became the general manager of Otlob (Now Talabat). After my tenure at Otlob, I met my brilliant co-founders. We collectively decided to launch Rabbit to expedite the evolution of the retail industry in Egypt.

The idea for Rabbit blossomed as my co-founders and I were discussing the future of retail. Netflix, YouTube, Spotify, and others changed the entertainment game by offering on-demand entertainment. Uber equally changed the transportation game by offering on-demand transportation. We realized that on-demand retail, too, was ripe for growth and would clearly be the way of the future. We began observing how companies abroad were offering ultra-fast delivery services to make a material difference to customers’ on-demand retail experience. After studying whether the Egyptian market was ready for this kind of disruption, we decided to launch Rabbit in 2021 and test the waters.

Rabbit is in the business of time. We sell peace of mind. Life nowadays can be hectic and unorganized, and Rabbit’s objective is to help alleviate that problem by unlocking on-demand retail for our users. By delivering their needs quickly, we help make a significant difference in terms of customer experience, and help them avail more time in their schedule and focus on their lives. We are proud of the fact that we deliver on our promise: 95% of orders made through our app are delivered in less than 20 minutes.

Our entire business is built with speed in mind, and we measure all our processes in terms of seconds. The most important KPIs I focus on include tracking the time spent to fulfill orders, monitoring the percentage of orders that meet customer expectations, and our user retention levels, as well as generally tracking our levels of efficiency.

I enjoy every second of my job. It has been an amazing journey so far. What I love about my job now is the fact that I’ve virtually become useless. Our team is made up of great talents. My co-founders and I were most useful during the company’s formative stages; when we were setting the vision, culture, and goals of the company. Now, I get invited to meetings where the team makes great decisions, and I have absolutely nothing to add [laughs]. I just sit back, observe the team’s amazing performance, and am happily taken aback by how useless I’ve become. Witnessing the team’s evolution is inspiring. For my co-founders and me, the best part of the job is empowering our team and giving them the freedom to fail, and the flexibility to take the initiative and create.

The founder’s journey can be lonely, but you can alleviate some of it by surrounding yourself with people who complement your weaknesses. If you pick the right team, and are partnered with great co-founders, you will always be able to turn to them for advice when you need it. For emotional support, for instance, we collectively have daily venting sessions about the daily challenges we face as a team.

The fact that we have friends at other startups who can relate to the problems we face has also made our journey easier. Talking to fellow founders is very thought-provoking. They face similar challenges on a daily basis, so when we come to them with our problems, they can definitely relate and offer useful insights. It’s very comforting to talk to founders like Omar Hagrass, co-founder of Trella, and Thndr founder Ahmed Hamouda, among others.

Fundraising is a never-ending endeavor for us: We hope to raise more funds in the future to expand, serve more users, and to enhance our customer experience, which are all part of our short- and medium-term goals. We raised USD 11 mn in pre-seed funding in 2021, which was at the time the MENA’s biggest pre-seed funding round.

Startups that I think are killing it include Khazna, Trella, and Taager. I love Khazna’s proposition and their focus. They’re a very principled business. I really like Trella’s resilience as a startup: the foundation they built is very impressive. And Taager is amazing in terms of how they’ve evolved their business model.

In my downtime, when I’m not spending quality time with family and friends, I devour business content. I watch CNBC regularly to catch up on the global economy as it spirals out of control [laughs]. I’m also an avid reader, so whenever I have the time, I like to kick back and dive into an interesting book.

The last great thing I read was The Hard Thing About Hard Things by Ben Horrowitz. Horowitz paints a vivid picture of the ups and downs of starting a business. He accurately captures the challenges all founders collectively face. I think it’s an especially prescient read today given how turbulent the global economy is.

If I had to do it all over again, I would still go down the investor route early on. I believe that bringing in the right investors turbocharges startups in many ways. Not only do investors bring capital to the table, they also bring market insights, and can help provide great networking opportunities for entrepreneurs. Our investors, for instance, connect us with counterparts in foreign markets to help both parties understand and navigate the problems of our collective industry.