Mounir Nakhla, I am happy to see you today and very glad that you are with us as my guest, with Moataz El-Demerdash.
Welcome, welcome, Mr. Moataz. Thank you for accepting the invitation and for sparing us some of your time. I know you have many things to attend to, but I am very interested in asking you about many things as well.
I am at your service, I am here.
And thank you for hosting us in this wonderful office, because the atmosphere is very nice and the decor, honestly, is...
Different, different from the norm.
It gives a very nice mood.
We are here at MNT-Halan. Exactly, what does MNT stand for?
Oh, that is a long story to explain.
Are you serious? A long story? What, Mounir Nakhla? It is not the basis.
It started because we had a company called Mashroey.
And a company called Tahseel.
Ah.
And there was an investor coming in from England, a private equity fund, so they used to call it in the office MNT, MNT, MNT.
For Mashroey and Tahseel.
So when we wrote it down, we said MNT, it sounds nice, so we wrote it as MNT.
It's a coincidence that my name is also Mounir Nakhla, so it's a nice coincidence.
It is a nice coincidence.
But that is a very pleasant thing, honestly.
I mean, catchy names always...
That is true, that is true.
Of course, later we will talk about the content and what this brand does.
Honestly, MNT is not consumer-facing, meaning it is not for the consumer.
The consumer brand is called Halan.
So you even find Halan cards, the name Halan, and Halan is...
I was very struck while looking at your journey—and by the way, I congratulate you on the success you have achieved and on your journey of struggle—we will talk about all your milestones. But it struck me, and I don't know if you agree with me or not, that we are all a product of our parents' work in us.
The equation of having a good education—a man who graduated from the London School of Economics—and at the same time a journey of struggle where one milestone leads to another, with strong persistence for success, I think the result of this equation is known and guaranteed. What do you think?
Without a doubt, we are the result of the actions and efforts of others, we are the outcome.
The first seven years of any human's life are the seven years where they download everything around them; because usually, in the first seven years, they listen, they watch, they see, so these are the years where they truly learn, which is unconscious learning.
After that comes conscious learning, education, what is right and what is wrong, you must do this, persistence, and struggle; these are all principles one inherits and sees, so without a doubt, we are the outcome.
Yes, of course.
But that does not mean that everyone does not have the responsibility to strive, work, and do; also, for one to shift responsibility onto others, I don't think that is right, one must take responsibility for their own actions and efforts.
Without a doubt.
Perhaps if we look at the CV of your companies, we might find that Halan, for example, is one of the most prominent achievements; there is no doubt that you have become a unicorn, the valuation of the company...
According to my humble information, has reached more than a billion dollars.
Yes, that's true; it was in the news, it was in the news.
And by the way, you were also selected by Forbes magazine, which is a very prestigious magazine in the global economy.
That you were among the top 25 most funded companies in the Middle East.
I want you to talk to me about this. The value of being a unicorn. And being one of the most funded companies.
A unicorn is just the company's valuation. It's the result of actions. What is more important than the valuation. The valuation is the price tag. For example, when you ask how much a Mercedes or a specific car costs.
It doesn't matter what it costs; what matters is how fast it goes, what the engine is like, the upholstery, the shocks, and if there are airbags in case of an accident—the product.
Is more important than its price.
Performance.
Performance; we focus on performance, and the price follows.
And regarding funding, the more a startup is funded, isn't that an indicator of success?
No, that happened in a specific year.
We closed a large transaction then and attracted many investors who put money into the company, so that was in a specific year.
It's not something constant.
But it does mean investors have confidence in your business.
Yes, investor confidence in the business, and these are investors who spend, for example,
nine months to a year studying the company before they decide whether to invest in it or not.
It takes a lot of effort, as they perform the due diligence, as it's called in English.
Due diligence, where they get to know everything about the company, based on which they value the company, and based on that valuation, they invest.
I was struck by the evolution of your business. We can talk about the journey from the beginning, of course. We'll talk about everything. But I feel you always have a vision for development. You don't just settle for one stage and stop. You always have something you see as a potential opportunity that no one else sees.
Right or wrong?
It happens, it happens.
It happens, I... And I can't decide if this is a strength or a weakness in me; it's a strength for me and the company that there's always something we're working on with great excitement, a new goal, and a lot of work.
The downside is that whenever I finish a project,
whenever I finish a phase, I find myself in a new one from scratch, entering a project that will take five to seven years, so I get busy again, and I work more, and it is, of course...
I mean, there's no, I want to say, break; you go from one thing to another back-to-back, as they say.
The last 16 years were like that.
It started with a simple idea, which was consumer finance.
Financing light vehicles, generally light vehicles.
Oh, it started like that in 2010, and it wasn't my idea.
No, no, it wasn't my idea.
Oh.
No, but what I know is that you spent time in your youth—well, you're still young and doing great—but you spent time studying some microfinance.
Microfinance, and you were a social researcher, and you saw the villages, hamlets, and the Egyptian countryside; you toured the governorates.
I toured, and so you were able to understand exactly the needs of the families that are...
I saw, no, I saw a side of Egypt I wasn't used to seeing.
That opened up different horizons in my mind, and I saw that there were many opportunities, and I saw how much people needed services, products, and financial services, so I said, why not? This is a huge market we can serve.
So when I started to grow and had connections and the opportunity to implement the ideas I had,
I said that we want to cover the entire Republic.
But honestly, a young man raised in the upscale Zamalek district, who went to Al-Alsun school and is also a member of the upscale Gezira Club—when he goes to the countryside, mingles, sees the farmers, and gets into that—you stayed for a while?
Nobody said anything, but it wasn't... how, how did you adapt?
I just sit and talk with anyone. How did I adapt? What? What? One human being and another human being sitting together, drinking tea, and chatting. How is your life? And then, we all have the same problems. How are you doing with...? How was your day? 'No, I have a headache.' 'My leg hurts.' 'I'm having some financial distress.' 'No, things are great for me.' 'Work is going well.' 'My wife makes me happy.' 'My wife is annoying me.' 'I'm thinking of doing...' 'The kids are exhausting me.' 'The kids make me happy.' We are all like that, right? What is the difference, then?
But success, in its beginning, was born from these communities because your project started that way.
Egypt's economy is built on these communities; the entire Egyptian economy.
80 to 90 percent of it is this economy; this is the country.
So, for someone to imagine that this isn't the country, then they don't know the country.
The economy is based on the issue of, you know...
It is built on small and medium-sized enterprises that are in every governorate, every street, and with every person—Egyptian markets, Egyptian trade, Egyptian industry, craftsmen, farmers, livestock—that is the economy. What else could the economy be?
These people need, shall we say, support from, for example, programs like Mashrouy, Taseel, or Hala, so they can do business and work.
They need, they need to be able to grow their projects. Any company today that wants to grow its business and sell more, what does it do?
It goes to the bank and shows them a budget, and the bank asks for a bank statement, and based on that statement, it gets funding. It can then enter a tender, grow, work with one pound, then ten, then a hundred. So, these small projects didn't have access to a source to fund them so they could grow. Who was funding them? They were being funded by wholesalers.
Of course. But the wholesaler would add to the price. For example, if I were to set up a display for a retail merchant with goods worth, say, 10,000 pounds. He tells him, 'The goods are, for example, 10,000 pounds cash.' 'Or you pay me after a week, once you sell them, at 11,500.' So when microfinance companies came to fund them, activate them, grow their projects, and provide them with support, they found that it was very feasible. Banque du Caire started working on this in '99, and Banque Misr in 2001.
So even banks—there are two banks in Egypt, plus Alexandria Bank, working on it.
These have been around since the late nineties and the year 2000.
So there are associations, companies, and banks—a huge market.
I want to go back to the beginning of the journey and know the idea and the start of the companies. I notice, of course, that it has been around, let's say, 20 or 17 years, isn't that right?
Our journey in this field.
Well, the company we are in today, since 2010, I will never forget when it was founded.
2009.
And my middle son was born on January 10, 2010, so I remember saying, 'He comes,' yes, he comes with his own livelihood. You know how they say a child brings their own luck? I truly believe in that.
Yes, with all three of my kids.
Wow.
That's a beautiful thing, actually. Many people will look at their children's birth dates and link them to their work, and they will find that the child does indeed bring their own luck.
The development stage, you could say, started in 2019 when you turned...
to technology.
Since 2017.
'17, we entered the field of technology when I met Ahmed Mohsen.
And he started to be a wonderful addition to the company.
Yes.
He is, well, I don't want to say a genius, but he is different from us.
In innovation.
Yes, with new ideas, and also technically; he is very skilled in computer science.
And in mathematics. He is a genius in both, which are both very challenging fields. But add to that, people like him are usually very focused and keep to themselves, but Ahmed isn't like that. Ahmed Mohsen is a cheerful, smiling person who is socially well-liked and talks to everyone.
He has the ability to think and innovate. And see things that are not yet tangible today. So, I see it from the perspective of what the market wants. And he sees it from the perspective of how we can execute it. Executing it through technology. And how we can create something that isn't being done today. To make the service easier for the customer. So they can get it faster. Get it cheaper. Get it with higher quality. So... he changes all that.
By using technology, which is, in the simplest terms for those watching, a mobile application. A mobile app.
A card linked to an application.
And paying via mobile as well, in a way that has made life easier for people.
Of course, from the comfort of their home.
They can do everything, submit an application, identify themselves... We might even perform a credit check and give them an instant credit limit approval, but to receive the card and such, they must sign, and someone must see them and match the ID to the person—those kinds of things.
So there will be, as you might say, a personal meeting, but only when necessary.
That's for when, but all other procedures are online, on the mobile.
On the app, if someone wants to invest, we can do it from A to Z on the app.
So, if they are buying into securities funds or other funds, today our company...
Um.
The number of services we work in has grown, from consumer finance, microfinance, and small business financing, to payments, whether it's the wallet or the card. We have distributed 1.4 million cards, and those who use them monthly exceed a quarter of a million citizens.
So, besides the card, we have a game on the application. The main goal of this game is to attract customers. There is... E-commerce, if someone wants to compare the prices of this TV versus that TV, or compare a mobile phone. So those are the two things at the end of the day, their goal isn't profit—the majority of things we do, we don't make money from them.
We do them to attract the customer to us. And provide them with a great service. And after that, we try to sell them the services that are profitable for us. But what we discovered is that when a customer enters our system, and engages with our range of services, and takes more than one service, the chances of them leaving us for someone else decrease.
Does your business compete with banks, or do you work with them in a system of, let's say, shared cooperation?
I, I always, I owe all my success to the banks.
We, we could never have existed today and stood on our feet without the banking sector; the banking sector is a partner, a partner, a partner to us, without a doubt.
Today, we do not take deposits.
So, no citizen gives me deposits, and I can't take deposits. Who takes deposits? Banks.
So, the banks lend me wholesale.
And we finance the projects and individuals ourselves.
So, it's a very interesting relationship.
They give us, for example, a billion pounds. And we give 10,000 pounds. And this one 50,000 pounds. And this one 3,000 pounds. And this one 100,000 pounds. And this one 5,000 pounds. The next one. So, it's like they are wholesale, and we are retail. Of course, we don't. Our relationships with the banks are stronger than just a partnership. I mean, you even find some banks.
Through their funds and through their investment companies, they became our partners—they became partners with you?
Ah, of course, Al Ahly Capital.
Which is the investment arm of the National Bank.
Came and took a stake in our company.
And it was in the newspapers and in everything.
So, Egypt today has how many banks? 36, for example, or 37 banks.
So, there isn't a bank that doesn't work with us.
So, naturally, it's a strong relationship.
But doesn't the consumer prefer dealing with 'Halan' for the ease of things and procedures, more than going directly to a bank?
No, of course, there are citizens.
Who like to work with the bank directly; the bank can offer them benefits, can take deposits from them, can pay them interest, can provide financing against a deposit, can issue specific certificates; there is a 'bank customer.'
And there is a customer who is not a bank customer.
They come into the bank, for example, they see a security guard, they go into the bank, they see someone wearing a tie.
This sight isn't, they aren't comfortable; the sight doesn't make them comfortable.
But going up to a second-floor apartment in a building similar to their own residence, in an area 200 meters from their home, is comfortable for them.
So, we complement each other to serve the Egyptian people.
It caught my attention, during the conversations I had with a number of businessmen or influencers who are businessmen or what are called entrepreneurs,
that they always tell me the Egyptian market is a promising market. A market with opportunity for growth. A market with potential, because. Simply put, we are talking about a market in a country with a population of approximately 110 million. Sometimes they tell you we are 120 million. I don't have the exact number, but it's in that range. So, I was surprised that after your success in the Egyptian market, you started to have a vision to go to other markets. You went to Turkey. You went to the UAE. You went to Pakistan.
So, why, why did you go outside the Egyptian market?
I will tell you about this. When I first opened our branches, ah,
I started in Greater Cairo; I started in El-Hamdiya, Shubra El Kheima, El Matareya, El Khusus; I started in the areas after that; I started opening in Minya; I found that Minya has 5 million people.
I said this is a very large market.
This country is as big as, bigger than, countries neighboring us.
I went to Asyut, then I found Dakahlia.
Kafr El-Sheikh, Beheira, I found that the country, every time I go somewhere there are 3, 4, 5 million people, that's a huge market one can work in.
So I spent years, four or five years of my life opening branches, and then I started adding products like light vehicle financing.
To home appliances; well, I already had the whole system ready.
It's like you opened a supermarket.
Will you sell tea, oil, and sugar and stop?
You might sell bread, yeah.
You might sell milk, you might sell Coca-Cola, you've already opened up shop.
So just as I did in Egypt.
First I open, then I add products.
I said, well, Egypt isn't the only country in the world.
What's stopping the company from being in 10 countries within 10 years?
What's stopping us from being in 20 countries in 15 years?
It's a mindset, imagine, for example, if Coca-Cola, McDonald's, or Nescafé...
had said we will only sell in our own country.
That's a bit of a strange mindset.
But they conquered the world.
They entered every place.
Yeah, they offer a product, people now...
I've always been frustrated.
That big companies come from abroad to sell to the Egyptian citizen and profit from them, this is considered importing.
A burden on our currency.
Strengthening their economy, these companies also hire, grow, and have a base of investors.
So why shouldn't there be an Egyptian company with a specific product? And there are many Egyptian companies in manufacturing, exporting, etc. But in our field. We can also enter one, two, three, four countries, especially since we've built expertise here that I'm confident doesn't exist elsewhere in the world.
Specialized. Difficult technical things like computer scoring models. Core banking software; now we've even integrated AI that helps us make many decisions in lending and collections. In following up with clients. In adding extra services for clients. I feel we now have 100 technology engineers building, led by Ahmed and his team.
They enabled us to have added value when we enter neighboring countries or even global ones.
So I said, every country, being able to enter a country is something very difficult.
I mean, it could take me one to two years of preparation for us to invest in a country outside Egypt.
But when we enter, a large economy opens up to us.
For example, Turkey has almost 90 million people, Pakistan has 200 million people.
The Emirates doesn't have these numbers, but it has a large economy, a large GDP, and a large economic volume.
There are other countries we might announce in the near future.
Also in the Gulf.
You are studying them?
We are close, God willing.
Meaning there is paperwork even, I expect.
Great, would you like to say what these countries are, or do you want to announce them at the right time?
I think it will be announced when...
When it's final, when we execute.
And what attracts you to a specific market? Population count? Like you say Pakistan.
GDP, GDP.
Population count, and me ensuring we have added value.
Well, I mean, will I be able to add value to the country, or has everything I might do already been done?
If I see that I have value to add, whether through our expertise, technology, or the other thing—which is that I must have a team, a managing director, or someone to run the country.
We can't... so if those three things come together, we invest. We have a committee from the board of directors that studies it and says—so this isn't a unilateral decision made by Mounir Nakhla.
And there are board meetings and decisions being made.
Yes, and I have to present it, and 100 people might tell me, 'What are you doing? This decision isn't right,' and I have to prove it, and we study it. The process of trying to convince the board of an idea or an investment...
is very useful for ensuring the decision is sound. It reduces the risks of the decision, because a decision like investing in another country is a very big one.
Because just as it might bring a return...
it might result in a loss.
So it must be well-studied.
And I have lost plenty before.
So, I mean, if one makes a small investment and loses, that's acceptable. Making a big investment and losing, that's tough to take.
It is said that the successful businessman is the one who knows when to withdraw from a project once they feel...
That's correct.
Yes, the worst thing a businessman can do is let their ego take over. If I take a certain step and find that this step isn't right...
saying, 'No, I'll make it right just because I'm the one who decided it'—that's what they call in English 'throwing good money after bad.' You're putting good money after money you'll lose. So the sound decision is that you...
say no early on, limit your losses, and close the matter, even if it means you come out and say, 'By the way, everyone, the decision I advised you to take was wrong.'
