In the technology business, you need to go where you are both valued and loved. Just a few weeks ago, that was Wall Street.
Increasingly as many securities like stocks and bonds became more like commodities, each investment bank tried to distinguish itself from every other by their technology. Who could calculate that CLO (Collateralized Loan Obligations) trade the fastest, who had the “stickiest” and most useful web portals, who could whip up a sophisticated alchemy around a complex swap or midwife some strange exotic within an hour of a client’s phone call. We at Infusion, a 200-person consultancy specializing in emerging technology and user-experience design, were both loved and valued: we wrote the tech that widened the spread — what they like to call the profit margin on Wall Street — and distinguished our clients.
And then the spread collapsed.
On some level, we had the advantage of seeing it coming. Infusion, in fact, specialized in complex, derivative-based systems, so we worked on the very systems that tracked the mortgage inventory, risk and pricing for a number of the big investment banks. I can’t say we were prescient; there was no definitive point where we said, “Whoa! Who’s buying this junk?” but there were a number of surreal moments along the way. Time and again, we’d ask how a given security was supposed to be priced in our equation… and you couldn’t get a straight answer. Basic questions like “how do we value this” tended to become string-theory discussions as opposed to simple arithmetic. In the end, no one completely knew. But for any answer the front office wanted, they could always find a quant to conjure a financial model that gave them that number.
We became increasingly concerned that too much of our revenue came from Wall Street. Also, we were surprised that we were doing as well as we were, even though people were already talking about a “credit crunch” and housing was sinking fast. And we remembered a lesson from the last big crash of 2001: things are great just before they aren’t.
And so I headed east with Infusion’s president, Alim. We had heard that in Dubai they valued “the best” whatever that might be. “Hey, that’s us!” we thought. And armed with little more knowledge than any dilettante could glean from a 60 Minutes interview with Sheikh Mohammed bin Rashid Al Maktoun and the oft-parroted factoid, “they have 60% of the world’s cranes” we hopped an Emirates flight to take a look for ourselves.
As it turned out, most of what we saw on that first trip was the lobby of the Grosvner House hotel. Even though we’d tried to line up meetings with big companies up there through our scant Dubai contacts (a couple of technology managers who’d moved there from the U.S. and one Canadian dentist) most didn’t respond and the few who did wouldn’t commit to a date. “Dear Greg. Let me know when you are here.” That was often the best I’d get.
When you are in sales mode, there is nothing more frightening than travelling someplace very expensive with an empty Outlook calendar. As we got closer to our flight out, we began to ask, “We’ve got no meetings with anyone and this is going to cost us twenty thousand per person! Man, what are we doing?”
Those first few days are the most terrifying. You sit by the cascading fountain in the well-adorned lobby of your hotel while one of the many falcon statues — ubiquitous throughout the Gulf — stares you down (“You don’t belong here!”) The hotel staff over-services you, literally running to refill your water with every sip…and you are visited by an ancient anxiety you remember if you ever went to a school dance by yourself instead of with a date. Everyone around you, it seems, has a partner. Repeated scene in every lobby couch and two-chair grouping: the one Emirati in white flowing dishdasha and sandals, nodding, saying little but listening intently to one of two blue-suits who, in German/Russian/South African/French accented English, outlines the grand designs of one thing or another in Strangelovian dialect; Vee kan build ‘zis, ya? Vill be, ‘ze best in ‘vrld!
You, however, try to look busy…watching your inbox in the event an email should slip in before you hear the “ding”… all the while pining for a sheik of your own to dance with.
But if you are patient, and willing to adapt, the tide can turn. When I bemoaned our lack of meetings to one of our contacts, he said simply:
“Did you call them? You have their mobile.”
“Can you do that? They never returned my email. Wouldn’t that be weird?”
“You have to do that. It is expected. They’ll meet with you if you are here…because, technically, you’re their guest now.”
In the same way as you really need to be on the trading floor to be useful to the core business of Wall Street, you really need to be in Dubai to be relevant to these people. Otherwise you are one of those countless dopes who fling them an email or a phone call in the hope of being showered with opportunity, after which, you might deign to visit them. They don’t appreciate that.
But when you visit in person, with an honest proposition and a willingness to have your claim of “being the best” truly tested, you can get those meetings. At least the first one. If you get a second, you know you did okay.
Any western business with successful operations based in the Dubai (or, for that matter, anywhere in the UAE) will almost certainly have one or more Emirati on staff. Emiratis are the locals (though vastly outnumbered by ex-pats) and collectively they form a very tight network of interrelated families and business concerns. Take any large private entity in Dubai (outside of the massive Dubai Holding company), trace it up, and you will end up at one of a small number of familial names.
Prove to a member of this network that you are genuinely good at what you do, and he might make an introduction for you — at any level: to the Chairman, to the CEO (they might be cousins or childhood friends), or to a mid-level manager.
One of my contacts got us a meeting with an Emirati who worked as a senior manager at a multinational company, in charge of local accounts. I’ll call him Waleed.
Waleed began the meeting with a simple question: “Tell me about yourself. What brings you here?”
I remember speaking for half an hour…going over everything we did on Wall Street, the trading systems, our expertise in this and that technology, our user experience/design focus…on and on, I rambled…it can be disconcerting when you encounter people who would truly rather listen than speak.
At the next natural pause, Waleed leaned back in his chair and regarded us for a long moment. It was somewhat cinematic.
“You don’t want to work in finance.” He said declaratively. “Here, you want to work with the resorts.”
With no further comment, he picked up one of three mobile phones on the desk before him and speed dialed. A quick exchange of gulf Arabic, maybe three minutes, and he put the phone back on the desk. “Ok, you have a meeting,” he said.
With that, we were in the resort business.
Well, almost. In reality, it wasn’t quite that easy. Many other meetings followed that phone call. The mystery party on the other end of phone had delegated our meeting to his European director who was as tough, smart and discerning as anyone I’d ever worked for on Wall Street. We had to do a proof of concept; our references were thoroughly checked. In fact, it culminated in a plain old and very formal RFP process that we had to win the old-fashioned way: by beating a number of other vendors.
We ultimately secured a truly visionary and terrific client: the kind of company that embodies what this region is all about. They don’t want to buy anything off the shelf, they want to build something entirely new. They reason: if we are going to be the world’s best, we need a system better than any of our competitors could possibly have.
Wall Street used to be that way. “In the old days” (I guess I can officially say that now) the return on investment for new, transformative technology on the trading floor was so high, it spawned enormous amounts of creativity and innovation; good tech (better than your competitors) equaled huge returns. It meant you could find and drink first of the fabled “alpha pool”…this is what I have heard traders refer to as the limited window of opportunity in some new market or financial maneuver where there is a good spread to be had.
“Alpha” was profit, and you sought “pools” of it wherever you could. These pools don’t last lasts long, however, before every competitor sees what you are doing and sticks his straw in and sips until its dry….you have to move on and evolve.
So it is with Dubai. Their original alpha pool, oil, is drying up, and they recognize that technology is key to their evolution (already well underway) from an oil-driven economy to one based on tourism, finance and anything else they can and will invent. The hotels, airlines and government agencies we now work with all understand technology’s transformative role.
When I found out Lehman Brothers was declaring bankruptcy, I was watching CNN from a treadmill overlooking the ski lodge at the Mall of the Emirates, where they actually have an indoor ski hill, complete with chair lifts, five different trails and even clouds which form “naturally” in the completely enclosed space.
The treadmill beeped. I checked the time. It was almost midnight over on Wall Street. In Dubai, the day was just beginning.
Gregory Brill is founder and CEO of Infusion Development, a 200-hundred person emerging technology consultancy with offices in New York City, Toronto, Boston, and Dubai. He is the author of several books on technology. You can reach him at firstname.lastname@example.org.