The UAE Is Attracting Founders. But Can They Become CEOs?

SPEAKER_1 (0:00)

This is the Morning Drive. It's Mira Business FM. The UAE has become a major hub for founders looking to launch and scale businesses. But starting a company and leading it as it grows are two very different challenges. So what happens when a founder has to evolve into a CEO, build proper governance, make decisions at scale, and a lot more besides? Sherif Foda has built and led a multi-billion dollar business. He's the chairman and CEO of oilfield services company NESR, National Energy Services Reunited joins us.

Sherif, thank you for coming on.

Sherif Foda (0:38)

Thank you. Thanks for having me.

SPEAKER_1 (0:40)

You're very welcome.

Really, I wanted to have a very general conversation, kind of to pick your brains this morning if you don't mind. And I wanted to start here. UAE is attracting founders from literally around the world. What's the biggest challenge, do you think, once a startup moves beyond its early growth phase?

Sherif Foda (1:05)

I think a lot of it depends on the industry and it depends on the services. So are you in the services innovation or are you in a large scale, you have to do a large scale operation to be like profitable or to be big or to get to be known? And if this is the case, then the biggest challenge is always the scale, right? People, especially if they are not from corporation, if they're not like originally used to be in big companies, they kind of underestimate the magnitude of scale and the back office and all the, especially if you're going to go public with the company.

SPEAKER_1 (1:46)

So how can founders, actually, let me backtrack slightly. Why is the transition from founder to CEO often more difficult than starting, actually starting the company itself?

Sherif Foda (2:01)

No, I think, I wouldn't say it's more difficult, but I would say, again, it depends on the industry. But a lot of the time, the founder has like a brilliant idea and he's like the innovator, the brain behind the whole thing.

But he doesn't know really how to run a business in the profitability and make sure that it is deliver a certain shareholder value, all this other stuff, right? So the innovation is great, the ideas are brilliant. However, the execution and the implementation of those ideas on the ground has a lot of stumbling block. And if you don't know this or you are not used to it, that's usually where the flaws happen.

SPEAKER_1 (2:48)

And how can a founder tell when the leadership approach that may have worked at the beginning of the journey, if you like, how can you tell when it's no longer working?

Sherif Foda (3:00)

Results, I think the most important part is results. And being very self-critical on that the results of the company from the original vision and the original plan that you had in mind is not happening, it's not being implemented. You have a lot of people quitting.

You have things are not exactly as you think it should have gone. Then, you know, it's time to really bring professional, run the company. And the founder can be always the chairman, the innovator. Sometimes in some companies, like you have a lot in the US, they move to become like the CTO, like the Chief Technology Officer, if the whole patent and IP comes with that founder.

SPEAKER_1 (3:46)

Early stage founders wear lots of different hats, right? And make every single decision. So how do you encourage or coach or, you know, push people towards successfully letting go of the day-to-day stuff, the operations, and get to a point where you can trust an executive team, but trust the team without losing that kind of finger on the pulse aspect that's so important?

Sherif Foda (4:15)

Yeah, I mean, you said it right, quite right. I mean, it's a very fine line between delegating and being totally hands off and losing totally the pulse of the organization, right? But again, that's the talent that people have to understand that it's a time. I am not really into the weeds of what's happening and I don't really add value.

So I should just step back, look at the stuff that I do best, and let the executive team really run the show. If the results are happening and we are delivering what we should be doing, then we are doing something right and maybe you should just get away totally from the operation.

SPEAKER_1 (5:00)

At what point should a founder consider bringing in a CEO or, I guess, also changing the leadership structure?

Sherif Foda (5:11)

No, I think as I said, the results, once you know that you had a vision, for example, you say this company, this idea would be able to deliver X, Y, Z, and we would be able to grow five times. And there is always with the founder a lot of ambition because they believe that their idea is right, which is, should be.