Money & Me: ‘Don’t waste your money on trying to please others’

Muhammad Chbib has invested in entrepreneurial ventures, real estate and technology stocks

DUBAI, UNITED ARAB EMIRATES , August 16 – 2020 :- Muhammad Chbib, CEO, Tradeling at his office in the DAFZA in Dubai. (Pawan Singh / The National) For Business. Story by Deepthi Nair

Muhammad Chbib heads Tradeling, an online marketplace for business buyers. The 46-year-old chief executive from Germany, whose parents are originally from Syria, first visited the UAE in 2003 for Gitex. Although he moved here in 2004, he returned to Germany in 2007 before the global financial crisis hit. However, he returned to Dubai in 2011 and has lived here ever since. He lives in Meydan with his wife and four children aged 9, 8, 5 and 3.

How did your upbringing shape your attitude to finance?

My father moved from Syria to Germany at the age of 16 to study medicine. Because his father died very early, he started working to support his family. As a first generation Arab immigrant in a western country, you usually never have too much money.

There are a few factors that changed my attitude to finances. My dad made a lot of money early in life because he had a few side hustles. He would joke that he earned four times more than what the German chancellor earned at the time. There was also a lot of consumption in my family. My father has six siblings and his mother was a widow early on. He supported them for around 20 years. That taught me to never forget my roots and to support family wherever you are.

He also told me that when you earn 100, take away 20 and assume you never earned it. Once I reached a certain stage in my life, I realised that while some consumption is justified, it is also important to save for a rainy day, my future and investments.

In the early 1990s, during the first Iraq war, my aunt fled Kuwait and came to Germany. There were 16 of us living in a 90-square-metre house. All of them, except my father, were without an income. When you have only five deutsche marks, the old Germany currency (equivalent to Dh11), in your pocket but have to feed 16 people, it can be hard. I now realise what my father must have gone through then.

What was your first job and how much were you paid for it?

My first job was selling bicycles. When I was 12, I told my father that I didn’t want to get anymore pocket money from him. I bought a used bicycle for 40 deutsche marks and sold it at a 50 per cent margin. With the money, I purchased two bikes. That’s how I started my bicycle trading business. I realised early on that when you have sales skills, you make more money than the average. When I was 13, I would run around in school with a couple of hundred dollar bills in my pocket. I used the money to buy a computer to start coding as a hobby. When I became older, I took up an office job in Germany as a side hustle while studying. I used to make 12 deutsche marks an hour on the job, which is the equivalent of Dh50 per hour today.

What brought you to the UAE?

Although I was raised in Germany, I felt a sense of belonging to the Arab world. In 2003 when I came to Dubai (the third Arab country I visited after Saudi Arabia and Jordan), the infrastructure wowed me and it struck me as an Arabic city with potential. I felt I could contribute the best to the Arabic region by being based out of Dubai.

What has been your best investment so far?

Apple shares. If you look at the past 10 years, on average they made 25 per cent and outperformed everyone else in the market. It’s always a safe bet no matter what happens. They have the power of innovation and reinvent themselves frequently. It’s a high-performing share whose price has grown and pays dividends as well.

It's luxury for me if I can afford to buy the latest iPhone or a mechanical watch

What luxuries are important to you?

Time is my biggest luxury. Whatever time I have, I’d like to spend with my children. If we talk about material things, I enjoy innovation in general. It’s a luxury for me if I can afford to buy the latest iPhone or a mechanical watch.

Are you a saver or a spender?

I am much more of a spender than a saver. I try to enjoy my life as much as I can. I’d like to ensure that my family does, too. There was a major shift in this behaviour when my first child was born. All of a sudden, your perspective changes and you start thinking about the future.

With regard to my business Tradeling, I am much more of a spender when it comes to creating a fun environment for my team. But when something like Covid-19 hits, you have to make sure you have the right spending levels and you save on the right space. It doesn’t make sense to save by firing all your best hires. People remember when you let them go in times of crises. You should spend at a time when no one else dares to spend and save when you are doing very well.

What is your most cherished purchase so far?

My first iPhone. It was an amazing piece of innovation and I never owned an Apple product before. I returned to Germany in November 2007. I took a cab from the airport, went straight to a telecommunications store and bought an iPhone. This changed my professional life, it made it so much more efficient. I never miss buying an iPhone since then.

DUBAI, UNITED ARAB EMIRATES , August 16 – 2020 :- Muhammad Chbib, CEO, Tradeling with the company logo at his office in the DAFZA in Dubai. (Pawan Singh / The National) For Business. Story by Deepthi Nair

What is your philosophy on money?

On a personal level, money gives me independence and freedom of choice to do things my way. Being able to spend a year at home with my children is a luxury only money can afford. I did that after exiting my last business, Tajawal.

From a business perspective, having sufficient cash reserves means you can offer your team the right environment for growth as well as survive in times of crisis. If we did not have the level of cash we had and our investors did not support us, then we would suffer as much as other companies during this crisis. Money gave us the luxury to think about what’s next for the company.

Has Covid-19 made you tweak your personal financial strategy?

One advantage of age is that you stop panicking. You really think long term. When I think of my private life and my business, I think in five-year strategic chunks now. I have the next 25 years to leave behind a legacy. If you have three to six months of disruption in these 25 years, you learn not to panic. There were so many moments in the past when you thought the world was breaking up, but it didn’t. You know this too shall pass.

How have you planned for your retirement?

Tradeling is the last mountain I want to scale in my professional life. I will focus on this company for the next five years, maybe even 10 to 15 years. After that, I will focus on mentoring young people who want to start their own companies. Unless my brain stops working, I will never retire. I don’t like the concept of retirement, however, I do think about investments for the future.

In what asset classes have you invested in?

I support entrepreneurs, which is a high-risk area with big returns, by investing in their companies. Even if they fail but manage to learn from the failure, I see it as a successful investment. I also invest in real estate, but it’s too conservative an asset class for my liking. I invest in shares and indices of technology companies as well. Stocks of companies such as Apple, Tencent, Alibaba, Google, Amazon and Microsoft are worth considering.

What financial advice would you give your younger self?

Don’t waste your money on consumption. During your early years, 60 to 70 per cent of what we do is to please others. Don’t buy things because you want to please others. I did this until the age of 29.

What led you to launch Tradeling?

It’s a project for the Dubai 10X initiative run by the Dubai Airport Free Zone Authority. The Dubai government was investing a lot of effort and money to understand how trade can secure the future of Dubai and the UAE. At one point, they decided that the efforts need to be channeled into a technology start-up. The Dubai Airport Free Zone Authority (part of Dubai government) founded Tradeling and approached me to build and scale the business a year ago.

Money gives me independence and freedom of choice to do things my way

I always knew there was room to innovate and remove inefficiencies in B2B e-commerce. Tradeling is an online marketplace for business buyers. We started by creating industry verticals for food and beverage, office supplies, health and wellness and will soon launch new verticals on automotive supplies, construction materials and used/new machinery.

We help companies list their products to sell on Tradeling, assist buying companies to find the products they need to purchase and facilitate the purchase process as well. We have also launched a credit line facility for SMEs in the region. Another thing we are working on is blockchain-enabled smart contracts to enhance contract security at the international level.