The following is the unofficial transcript of a CNBC interview with Careem CEO Mudassir Sheikha from the CNBC Evolve Global Summit, which took place today, Wednesday, June 16th.
Video from the interview will be available at cnbc.com/evolve.
All references must be sourced to the CNBC Evolve Global Summit.
HADLEY: Walk me through this aggregator narrative at this point off the back of all of that interest as a result of COVID-19. I was told that there's a major driver shortage.
MUDASSIR: There is. In some places, drivers have sort of moved on from ride hailing and gone back into what they were doing previously, or started doing deliveries. But they are coming back, Hadley. It's just a slightly slower process to increase supply than to increase demand. So as the demand is picking back up, as the prices are rising, in some places the drivers and the captains, as we call them, are finding those opportunities interesting and coming back. But we are still in the early phases of recovery, at least in our region. The shortages are not anywhere close to acute - you can still get a ride in most cities in a few minutes.
HADLEY: What about the food delivery business, because I was told that it's really not the time to prepare the food; it's actually just trying to get somebody who can get it from point A to point B. And that's where you see the shortage. Is that something you're finding?
MUDASSIR: Not quite, because in some ways, if you look at our super app strategy, not only do we have demand synergies where people that have used us for ride hailing now can start using food and grocery deliveries from us. But at the same, on the flip side, we have supply synergies as well. So a lot of people that, at certain times of the day, are used to moving people around, are now doing food deliveries and grocery deliveries at other times of the day when they're less busy. So we're not seeing the kind of shortages that you're describing. If anything, this sort of throughout-the-day demand is actually helping us retain our captains on all the verticals and on the Careem platform.
HADLEY: In terms of the super app - obviously this is a new era for doing business, how have you been adapting or staying nimble, if you will?
MUDASSIR: The super app basically brings multiple services that Careem offers - and also third parties offer - on a single app. And as soon as the pandemic hit, and now we're coming out of it, as the composition of services that people need changes, the services on the super app changes. For example, in the early days of the pandemic, there was a big, big need for a service called 'Order Anything' - people can order a captain and get the captain to take things from point A to point B or buy something for them from a store. Those kinds of services were the need of the day at that time. And when you open the super app, you basically see those services. Whereas if you open the app now in the morning, we expect that you probably want to go from point A to point B and we show you those services.
But look, like I said in all cases, when people have tried the convenience of the super app, and they've gotten used to some of the services that we have - whether it is food, groceries, adhoc deliveries - they do tend to use them even when life is starting to get back to normal.
HADLEY: It's interesting, isn't it? Because obviously as we say it's required some forethought in companies to be nimble at this point, where are the opportunities that you see in our part of the world? Put on your innovator's hat if you will. The Abraham Accords are opening up some serious potential opportunities and tie-ups for this part of the world.
Now you're entering that post-COVID phase with a country, the UAE, that has a very high vaccination rate. Where do you see the next opportunities for a unicorn?
MUDASSIR: That's a great question. And let's just recognize that even the services we currently have on the super app, such as ride hailing, food delivery, grocery delivery, are still extremely early - most of these services have single digit percent adoption of the entire market. So there's no sort of shortage of opportunity in those segments.
But having said that, as we've also seen, there has been an increased influx of funding to start-ups and the ecosystem is thriving. Every day, there are companies raising billions of dollars. What we have realized when we spoke to many of these companies, is they are actually struggling with some of the same things that we struggled with five to seven years ago: They're struggling with last-mile logistics, they're struggling with payments, especially cash payments. And one of the places where we see an opportunity is to start enabling these B2B services focused on these new start-ups that are starting to raise money and scaling their businesses.
So we have a last-mile logistics business now that we call Careem Express, that has exceeded our expectations. And we're in the very active pursuit of what we're calling Careem Pay, which is the payments business within Careem, that basically prioritizes a lot of our capability and exposes that to the ecosystem, to start accepting and dispersing money in the 15 countries in which we operate quite seamlessly.
HADLEY: What about what happens next in your view, because I've been speaking to UAE officials about the strategy for the UAE over the next few years - it's less of a kinetic approach, less of a reactive foreign policy approach, and one that is much more about exerting a soft power and influence throughout the rest of the region.
Part of that is a major, major push to be innovative, to open the door to businesses, to foreign direct investors, and frankly to work with anybody who wants to be in this country to do business and to create jobs. Where do you see that job growth coming from over the next 10 years?
MUDASSIR: Of course, technology - technology development, technology businesses - will start to see more and more job growth. In that way, UAE is actually very, very well positioned. Because in the UAE, we have an infrastructure that has a very strong value proposition for top technology talent. And as the region starts becoming more technology-savvy and starts using these online services for more and more daily things, you will see the UAE becoming a more central part in services that are being delivered anywhere in the region.
HADLEY: You were the first unicorn in the MENA region to make an exit over $3 billion, of course, and that was to Uber. Anyone you're seeing out there in the space that looks as if they can make something similar at this point, or do we have a long way to go in terms of that ecosystem?
MUDASSIR: We're not very far from having a few more unicorns in the region, Hadley. The momentum of the ecosystem is just incredible. There are some very strong entrepreneurs building new businesses.
HADLEY: Give me some names. What's interesting?
MUDASSIR: I'd be afraid of missing anyone out but there is a lot of exciting activity. One thing that did change as a result of Careem becoming a unicorn, Souq getting acquired, COVID accelerating digital adoption, is that instead of wanting to go and work at multinational businesses, now top talent in the region actually want to build start-ups. So all of a sudden you have top talent choosing to do entrepreneurial activities, and you have investors realizing that this is a big opportunity, funding these entrepreneurs, so it's a magical combination. There isn't a shortage of opportunity in the region to begin with.
These three factors are starting to come together, to inshallah, create a lot more unicorns over the next few months and years.
HADLEY: Given your experience, what is it that they're going to have an easier time with at this point? Is it going to be just fundraising generally?
MUDASSIR: Definitely fundraising is becoming easier, which is a huge, huge blessing. Finding top talent to build these products and build these businesses is starting to become easy, because they see the value in building these entrepreneurial ventures.
But scaling in business is still hard, you still need to go and expand to all those markets, get customers to trust you, get them to keep using your platforms, dealing with the operational complexities of running a technology business in this region. It's not easy. So my sense is that funding is going to be solved, initial talent will be solved. But talent - scaling the talent, and the talent that can help scale - is going to be the next frontier that we have to conquer.
HADLEY: What about the job situation for Careem specifically? Because I know that there was a major hit, as we saw COVID-19 coming on, back in 2020. Where are you with jobs today? How many jobs have you been able to reabsorb because of things moving to this sort of post-COVID economy?
MUDASSIR: We are very aggressively recruiting for all the businesses that we have started and are looking to grow. Before the pandemic began, we were largely a ride-hailing business. But now we have a very meaningful food delivery business, we have a rapidly growing grocery business, we have a pretty large payments business that is starting to become even bigger. And for all these businesses, we need talent. So every month, we're adding 40 to 50 employees to go out and help us build these new businesses.
HADLEY: And then in terms of that rate of rehiring, I understand from the numbers that you had to slash something like a third of your workforce back at the beginning of COVID. How quickly are we going to bring those folks back in terms of the numbers?
MUDASSIR: So the pace of hiring is pretty rapid, and if it continues, then we should be back to those levels by the end of the year, most likely. But this workforce that we have will actually be building a lot more businesses than we were building before. As a result of COVID and a lot of the innovation that happened in the last few years, it has actually made us a lot more efficient in the way that we run the business. So as the recovery happens, we will be scaling and going a lot more efficiently than we were before the pandemic.
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About the Evolve Global Summit:
As technology and innovation are redefining expectations for corporations to achieve success and growth in an era of disruption, business leaders are embracing change and transforming their organizations for the future. Most recently, unprecedented and unforeseen challenges due to the global pandemic forced companies to rapidly adapt operations, policies and products to survive—and in some cases, thrive.
The CNBC Evolve Global Summit will gather leaders and innovators from around the world for provocative conversations and to share strategies and tactics necessary for adapting, innovating and transforming in this new era of business.
Leveraging the power of CNBC Business News Worldwide with its global roster of anchors and reporters to lead conversations, the virtual summit will feature programming across multiple time zones originating from each of the following key regions for the first time ever – APAC, EMEA and the Americas – to reflect the borderless nature of business today. The virtual summit will examine the driving forces, both through the lens specific to each region as well as the global economy, creating opportunities for change.
For more information, visit www.cnbcevents.com/evolveglobalsummit