Interview: In a conversation with Jon Richards, Founder & CEO of Yallacompare

Dubai-based yallacompare (formerly known as compareit4me) is one of the leading comparison websites in Middle East & North Africa. Founded in 2011 by Jon Richards & Samer Chehab, the platform allows users to compare and buy insurance policies online. It also enables the consumers to compare different financial products including bank accounts, credit cards, and loans.

Currently present in nine markets of Middle East and North Africa, yallacompare claims to have 76% of the market of online insurance sales in the GCC. The startup has raised over $10 million in funding from some of the leading VCs of the region including Wamda Capital & STC Ventures.

We had a chance to speak with Jon Richards, company’s founder and CEO to learn about his entrepreneurial journey to build one of the leading fintech startups of the region.

The idea & Founding Team

Please tell us a little bit about yourself. What’s your background and how’d you end up in Dubai?

The idea of being an entrepreneur was something I needed to do from the day I got my first job. I’ve always said that I’d rather sell apples from a stall on the side of a road – so long as it’s my own apple store. I would rather do that than work for anyone else.

That said, before starting yallacompare, I carved out a pretty successful career as a marketing manager. That’s how I ended up in Dubai – taking a marketing job at Propertyfinder. And, to be honest, I needed my 10-plus years of work experience to have the skills and knowledge to build a start-up business. But for me it was always about working for myself. I’m incredibly difficult to manage – I appreciate that! I’m always right (I’m not – but I believe I am), so I had to work for myself.

What was the idea behind launching yallacompare? How’d you think of it? What’s the founding story?

When I first moved to Dubai in 2011, like everyone else, I needed banking products. I needed a bank account and everything else. But the banks back in those days had one-page websites, and zero product information. So a website like ours was absolutely essential. Having come from the UK, where comparison is ubiquitous and second-nature, it just seemed obvious to me that we needed to do this.

Who were the founding team members and where did you meet them? Are they still with the company?

I worked with my co-founder and COO, Samer Chehab, at Propertyfinder. We would meet during lunch and talk about the fact that we’d really like to start our own business. We ran through a number of different ideas, to be honest, but this is the one that stuck.

My wife also credits herself as a co-founder because she used to work for a comparison site back in the UK. She likes to think of herself as seeding the idea – maybe one day I’ll give that to her!

It was a typical start-up, though. Just two guys chatting about different ideas, and this is the one that stuck. We really felt like we could make a difference with it.

Believers, Naysayers, and Initial Investment

Who was the first person to believe in your idea and did you come across any naysayers?

Actually, when I was just getting started, I’d spoken to another person about being a co-founder, and he didn’t believe the idea would work. But me and Samer were speaking one day, and he fully believed in it. He knew he could work with the agencies and the banks on it. He believed it was something we could commercialise. He believed in the consumer part of it, but he also believed that you could make revenue – which was the important bit, obviously.

The first person to make me think this could be a real, big business, though, was Jonathan Hall, our board member. He was our first angel investor and he’s the managing director at Mulverhill Associates. When I spoke to him, he made me believe that this could be a $100 million company – and more. He still believes today that this is a once-in-a-lifetime business idea. And that was when we realised that maybe we were onto something.

But lots of people didn’t think it would work. Lots of the banks were sort of dismissive because it was a totally new concept here. It’s obviously very familiar if you’re from the UK. But locally, it was brand new and people weren’t sure how it was going to pan out.

How’d you finance the startup initially? When’d you decide to raise external funding and how difficult was the process?

We launched the first version of the site in 2011, and it was more hobbyist than anything else. I had a few different websites live at the time – maybe six or seven – and I was just doing SEO on them to see which of them would get any traction. And it turned out that this one really stuck. I was able to get it to the top of Google for every relevant search, and we got loads of organic traffic.

We went a couple of years from there before we spoke to Jonathan Hall. But by then, we were kind of at breaking point because we were so busy. It was taking up all of our spare time but it wasn’t earning quite enough for us to pay ourselves a salary out of it. We were in this weird place where we had to either raise money or just leave it. I was super-stressed, to be honest – Samer still likes to joke about it to this day. So that’s when we decided to seek funding, and in some ways, we did it at the perfect time because we already had revenue and a proven model.

I’ve already said that Jonathan Hall, our first angel investor, was really bullish about the company. But in those days, you’ve got to remember, the ecosystem was totally different. There wasn’t really an ecosystem to speak of. There were no incubators or start-up events, or any of that. It was a lot harder back in those days.

“Jonathan Hall, our board member [who] was our first angel investor made me believe that this could be a $100 million company.”

Has there been any point in your entrepreneurial journey when you thought this is not going to work, let’s just pack our bags and go home?

Only in those early days – before we raised money. In those early days we just weren’t sure if it’d even work. We were working incredibly hard, but we didn’t even know if we were allowed to speak to investors, or whether they’d want to hear from us.

Since then, we’ve always known it was going to be big. We have enough smart people around us on the board, and other investors, who really help to renew our optimism. And between us – with me, Samer and Jonathan Rawling, our CFO – any one of us could be down at any one point, and the other two will point out all of the amazing things that are happening.

“Working at Propertyfinder was like being in start-up school – it was amazing. We were a pretty small team back then, so we learnt how to do a lot with very few resources – and how to make our funding go further.”

You had the chance to work with one of the best-funded startups at the time (PropertyFinder). How did that help in building YC?

Working at Propertyfinder was like being in start-up school – it was amazing, that place. Because Propertyfinder launched at a time when the region’s digital ecosystem was pretty much non-existent, they’d developed all of these growth-hacking techniques that are still relevant today. We were a pretty small team back then, so we learnt how to do a lot with very few resources – and how to make our funding go further. All of those skills I developed when working there were obviously very helpful when it came to starting yallacompare.

But quite apart from all of that, Propertyfinder is where I met Samer, my co-founder. Who knows if the company would exist as it does today if we hadn’t both worked there at the same time?

Challenges & Achievements

What has the biggest challenge in your entrepreneurial journey and what’d you do about it?

I think the biggest challenge may be learning to run a business. It’s a bit like parenting. There are stages of parenting where, in the first year, you kind of nail it and you think you’re the best parent in the world, and you’ve got everything figured out. Then two weeks later, something changes, and you’ve got to re-learn everything all over again. First they’ll start teething, and then they’ll stay up all through the night, and you have to adapt to those developments. It’s exactly like that when you’re running a company.

No-one sat us down and told us how to run a company, and still no-one does. You have to learn on the fly. Today, we’re a company of over 100 people, but three years ago we only had 20 people. How you run those two businesses is completely different. How you recruit for them is totally different. The talent you need is totally different. The amount of trust that you put in people now needs to be greater. And it all needs a whole new set of skills from me today than it did three, four or five years ago.

That’s the biggest challenge, and it’s ongoing. The next stage will be mergers or acquisitions, so now I’ll need to learn that whole process. But it’s made easier by recruiting good talent and having good people around you. And it’s not just about their skills but it’s about them being aligned with you from a moral standpoint, from a work ethic point of view.

What do you consider yallacompare’s biggest success yet?

At the time, closing our $3 million Series A funding round felt like a massive win. It was this big stamp of approval from these big VC firms who saw thousands of companies every year, including the competition, and they chose us.

I would say, though, the thing that will have the biggest lasting impact on the entire company is the launch of insurance comparison. Bear in mind that we built the insurance comparison platform from the ground up – no-one had this technology in the region, and there was no white-label software that we could take and work on. Today, the insurance business represents between 50% and 60% of our revenue every month, and it’s growing – we represent over 76% of insurance policies sold online in the GCC.

That makes us more investable. For one thing, that side of the business is very defensible. It’s very hard to build that technology, meaning you’re going to need to spend a lot of time and effort on creating something similar. And our relationships with insurers are defensible, too. With the data we can provide, we’re able to work with them on consumer trends and assist in creating new products.

We’re still fighting every day to maintain that growth – it’s tough in a market that’s relatively nascent and has this aversion to buying online. But I think we’ve done an amazing job and we’ve had to build completely new skillsets – we’ve had to create a call center, we’ve had to make huge investments in tech, and we’ve had to create a whole new management team. But I still think that’ll be our greatest success – until we exit, of course.

“No-one sat us down and told us how to run a company, and still no-one does. You have to learn on the fly.”

Work Culture & Rebranding

Building great work culture is one of the most important criteria for any startup’s success. Do you think you have that YC. If yes, how’d you build it?

I think we’ve got a great work culture at yallacompare – it’s all very ‘work hard, play hard’ here. At the beginning it was down to hiring great talent, experts in their fields who really bought into the vision that we had for the company. And we worked incredibly hard – especially in the days after we completed the Series A – but we always made sure there was an element of fun around the office as well. Whoopy cushions, silly games, and all that stuff just came as part of the package.

Further down the line, as we grew and we had to manage more people, we still retained that sense of fun around the office. But we also wanted to codify our culture a little bit, so we came up with the four pillars of yallacompare. Keep it simple; okay is not okay; dream big; and seriously fun. Hire the right people, and bring them into an organisation that lives by those four pillars, and you have a work culture that thrives on hard work and having a good time.

Even with the call center – hardly a business area usually associated with fun – we try to inject a little bit of playfulness. We regularly hold what we call ‘Days o’ Fun’ in the call center – agents get to spin a wheel or draw from a hat every time they arrange an insurance policy. And there are some serious prizes in there – anything from AED 10 to an Xbox One. There’s a great atmosphere whenever someone picks up a good prize – everyone just has an amazing time with it.

You guys went through a rebranding process almost a year ago. What was the inspiration to do that and how’d it go?

When we first started the company, we had no idea that it would become the business that it is today. We honestly didn’t think ahead to international growth and expansion, and we didn’t realise that what we’d built would become as successful as it has been across the MENA region. Our success outside of the UAE is what’s informed our decision to create a brand that better represents our English- and Arabic-speaking customers. Today, we compare everything from personal loans to flight tickets; we’re the largest insurance aggregator in the Middle East by a considerable margin; and we’re active in nine markets across the region. We needed an identity that better reflected these realities.

Plus, we’d found that the previous name, compareit4me.com, was a bit of a mouthful, and we definitely wanted something with better brand recall.

Of course, it’s risky changing your identity when you’ve already built up so much. We’d already taken the lead in the insurance comparison space, and we had three or four times the revenue of our nearest competitor, so there were a couple of worries about messing with the formula. But behind the scenes, we had the same world-class team running things, and we stuck to our ideals of saving people time and money through sensible innovation and keeping things simple.

I’d say that, a year on, it was a brilliant move. It took a little bit of time, but I think we’ve built a hugely recognisable brand out of yallacompare, and it’s so much more expandable to the rest of the region.

Competition, Profitability & Future Plans

Since you started, multiple other players have also emerged with substantial amount of funding. What do you make of them? How do you continue to differentiate your products and offerings?

We’ve been helping consumers save money on insurance for over two years, we originated more than $20 million of policies in 2017, and we now account for over 76% of the online market. Because of those facts, we’ve now got exclusive rates that you won’t find anywhere else. That means consumers can save up to 20% with us. We’re the cheapest in the market, we’ve got exclusive rates, and that’s always been the plan – to show the insurance companies that we can be a good partner and that we can help them grow as we do.

In turn, we work together to create exclusive products based on the datasets that we offer. And I think our goal now is to continue to build the brand, a brand that’s fun and about helping consumers, and continue to offer the best possible way to buy insurance. That’s how we differentiate.

Bear in mind that quite a few new players have come into the market over the past year, and we’ve still grown our market share. Our dominance isn’t going away. We’re also about to close our Series B round of funding, which will maintain our position and help us to grow our market share even more, and we’ll offer more of those exclusive products.

“We’re [actually] months away from profitability.”

What are the future plans about expansion, technology & team?

We’ll be launching insurance comparison in three new markets later this year. Of course, that takes time, but we’re on the cusp of going live in one of those markets within a matter of weeks. And while we do that, we continue to invest in technology, automating parts of the buying process wherever we can, and we’ll soon be making a big announcement for our mobile users. With all of this expansion, we’re obviously expecting serious growth, so we’ll continue to hire the right people when and where we need them. We’re also now in a position where we can consider acquiring smaller players if we see a good fit.

What are the numbers like at yallacompare, in terms of customers, vendors, transactions and how close are you guys to profitability?

We’re actually months away from profitability. Even though we’re saving insurance consumers 20% versus the nearest competitor or going direct, we’re still able to maintain a margin. For the first few years, we focused on growth rather on profitability, however as the business matures, and we become better at what we do, we’re finally seeing the light at the end of the tunnel and edging towards profitability.

Plus, because of the brand we’ve built, 60% of our insurance traffic is actually organic. That’s where you want to be as a start-up – you don’t want to be buying every visitor who comes to the site. You want them to come to you because they know of you.

Last year, we sold $20 million worth of insurance policies, and this year we expect that to be something like $60 million.

What are the top selling products/services on yallacompare?

At the moment, around 50% to 60% of our revenue comes from the insurance business, while the rest comes from our banking comparison business. The banking business has been growing very nicely over the last year, and that just illustrates how much of a powerhouse the insurance business has become.

Are you planning to raise more capital anytime soon?

Quite honestly, we haven’t been as motivated for funding as we could have been. With revenue growing every month, and the burn rate coming down every month, we’ve been a little slow to close our Series B. We’ve been very picky about the kind of money we take, and who we take it from, and we’ve turned down media-for-equity offers that I know others are happy to take – when we buy media, we get incredibly good rates that aren’t worth equity, frankly.

But we’ll probably close this Series B in the next few months. And as any start-up owner knows, afterwards we’ll immediately start thinking about raising for our Series C!

Dealing with governments in MENA & Regional Ecosystems

It’s not very easy to deal with governments in this region esp. if you’re expanding beyond UAE in countries like Saudi. How’d you overcome this challenge?

It’s very difficult. We’re in a fragmented market in the MENA region – everyone has a different regulator and a different set of rules. That is incredibly difficult to grapple with, and it’s increasingly becoming a bigger part of my day. At the moment, it takes a lot of time to research how we enter a market, and whether we can do it right. And as we know in the Middle East, you can still do everything right and still face delays.

I don’t think we’re getting it right yet – we’re still learning. Some of these markets are very startup-friendly, while some are still very difficult. With all of the cooperation within the GCC, hopefully this’ll get easier as time goes on.

What do you think is the best thing about MENA’s startup ecosystem and what do you think needs improvement?

Clearly, at the moment, the MENA region is a land of opportunity. There are products, services and apps that don’t exist here but do in the US, UK or Europe. There’s a lot of opportunity for the brave to take those concepts and introduce them here. But there’s also a reason that these businesses don’t exist here yet – it’s incredibly hard to build them.

If you look at the entire population of the MENA region, you’re talking more than 350 million people. That is a huge number of people compared to, say, the UK. However, you have to knit together all these different markets to get to those 350 million consumers. When doing that, you have different legislations, different regulators, and different consumers, and you need to balance all of that with your business goals. You even need to think about time zones – Egypt, for example, is two hours behind the UAE, and it’s a three-and-a-half-hour flight to get there.

Because of all that, there are parts of the business that you can run from a central HQ, but you need boots on the ground. In the UK, you could run everything from London. Here, you probably need a few different offices.

I still think there’s a great amount of talent here, though. Jordan, for example, has amazing tech talent that comes at a slightly discounted rate compared to, say, Dubai. So there’s a good opportunity for founders to get access to amazing tech talent but still be mindful of how much they’re spending.

In terms of improvements, I think the governments need to work a bit more closely together to make it easier for start-ups in all of these markets to launch in new countries. It’s to the advantage of the UAE government if a UAE-based start-up finds it easier to expand to, say, Saudi. That revenue is coming back to the UAE, where the company will be hiring HQ staff. And it’s to the benefit of Saudi because you’ll obviously hire locally as well. We’re a small start-up, but we’ve created over 100 jobs. Those employees are being paid a regular salary, and they’re spending in the local economy. If it’s easier for me as a business owner to expand to different countries, everybody wins.

“We’re in a fragmented market in the MENA region – everyone has a different regulator and a different set of rules. That is incredibly difficult to grapple with.”

Work-Life Balance, Advice & Favorite Startups

Being an entrepreneur is not easy. How do you manage work-life balance?

I don’t manage work-life balance that well. I go home at around 7pm, and see my daughter until she goes to bed. In that period, I’ll try not to look at my phone, but as soon she’s in bed, it’s back on the phone. I’ll admit that I’m not great at allowing my mind and body to rest – others are better at it than I am, I’m sure. I have, however, been trying a little bit harder recently. Last year I think I took more holiday days than I had done in the previous six years. It still wasn’t much in terms of time off, but it was a start.

What would be your advice to young entrepreneurs of the region?

Focus on your revenue early on. If you can prove that you’ve got a business model that works, that generates revenue, then you’ll find it’s much easier to secure investment further down the line. And on investment, start approaching investors early. Your business may not even need money right now, but put yourself on investors’ radars so that they can track you. And when you do need investment, they’ll know who you are and what your business is about.

I’d also say to think about scale very early on. The UAE is a great place to start, but you need the eyeballs that come from the other markets, and you need to be able to knit the whole of the Middle East together into a single, compelling product. That’s what Souq.com did so well – they’ve proven that’s what you should do, and that’s what other start-ups now need to do. You need to capture the whole of the MENA region, and in order to do that, you have to build a product that’s scalable from day one.

Investors want a big business – they want a business that can scale and grow. VCs aren’t looking for lifestyle businesses; they’re looking for the next billion-dollar company. As proven by Souq, you can only build that when you scale across the region.

Please name your favorite regional and international startups.

Souq is an obvious one. They’ve proven that, if you expand and build a defensible business, the biggest companies on Earth won’t want to attack you and will just acquire you instead. It’s epic, what they did.

Propertyfinder is another one. They started a website when websites weren’t the thing in this region. I’m not sure how much people realise about the adversity they had to go through in those early days, and now they’ve built a monster business. It’s a huge company and it’s got a great brand that’s go-to for consumers. They had big challenges starting out – at the time, Gulf News was the dominant player with their classifieds, and they were super-aggressive towards Propertyfinder.

Of course, today, there are so many challengers in that space. But people think it’s so easy to start a property website. Of course you can buy a theme on WordPress and start a property portal. But that doesn’t mean you can build a business that can tackle Propertyfinder. You can have a lot of money and you still won’t be able to take on their business. The team there is amazing and they’ve become a huge household name – they’ve done an incredible thing.

Internationally, I naturally take inspiration from the comparison sites in the UK. It’s a war there these days; there four top players, and they change their position based on their ad campaigns. That’s amazing – that a TV campaign could make or break you. What the guys at comparethemarket.com have done with their brand is phenomenal. They were one of the smallest, and after the famous meerkat campaign in 2009, they became the third-largest. I really admire what they’ve done.

But the UK is filled with massive companies that don’t get the same cool start-up points that similar companies in the US get. Quidco, the cashback website, came out of nowhere. They have the typical Silicon Valley start-up story – a couple of guys at university started it as a way for students to save money shopping online. Now it’s a massive company with over 4 million members. But you don’t hear that over here – maybe the Brits aren’t as good at selling the dream as the Americans are!

“Focus on your revenue early on. If you can prove that you’ve got a business model that works, that generates revenue, then you’ll find it’s much easier to secure investment further down the line.”

Have you had any mentors or role models that have influenced you?

Our board play a critical role in helping us make the right decisions. Day-to-day, it’s up to us to run the business, but of course, with big decisions around funding, investors, market expansion, or new commercial activities, they play a role. They’ve got experience from their other portfolio companies that they can share with us. They’ll help us understand what challenges have been faced previously, by whom, and how they’ve overcome those challenges. That plays a big part for us.

What’s your favorite book?

Some of my favourite books have been the stories of entrepreneurs in the UK. I’ve read lots of the books by the people on Dragons’ Den, and I really enjoy them. Some of them really go into the nitty-gritty of staying up until 2am negotiating a price of a company, and the stresses and strains of building a business. Typically, I prefer to hear founders’ stories – how entrepreneurs did it. It makes you feel better when you’re reading about the challenges that someone has overcome, and they’re the same challenges you’re facing today. You learn through their experiences without having to be taught.