The Medium Rules Episode 5: Tennis Tech with Walid Fattah, CEO & Co-Founder of Kourts, Inc.

The Medium Rules Episode 5: Tennis Tech with Walid Fattah, CEO & Co-Founder of Kourts, Inc.

On this episode of The Medium Rules, host Alan Baldachin speaks with Walid Fattah, the CEO and Co-founder of the tennis-court booking app, Kourts, Inc. Alan and Walid cover the Kourts platform and functionality, Kourts’ go-to-market vision and strategy and its approach to scaling its business, and in particular the unique challenges of disrupting in tennis.

Topics also include Kourts’ positioning and differentiation as a “tennis” brand from the perspective of both tennis clubs and players, and how Kourts fits in and is differentiated from legacy court booking software as well as other emerging entrants in the market. We also get into the origin story of the Kourts founding team, which you might be surprised to hear, ties into what is a burgeoning tech startup scene in Dubai.

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Transcript:

Alan BALDACHIN: From the HBA Podcast studio in New York City, welcome to The Medium Rules. I’m Alan Baldachin.

Joining me today in the HBA Podcast studio is Walid Fattah, the CEO and co-founder of the tennis booking app and club management software platform Kourts, Inc., which is spelled with a ‘K’. K-O-U-R-T-S.

In this conversation, we’re going to take a look at the Kourts platform and functionality as well as how Kourts is part of a wave of tennis tech startups. We’ll also get into the origin story of the Kourts founding team, which, you might be surprised to hear, ties into what is a burgeoning tech startup scene in Dubai.

Finally, as we’re taping, it happens to be Week 1 of the 2018 U.S. Open here in New York City, so as a special bonus for the tennis heads among us, we’re going to get into a little U.S. Open discussion. In that, we’ll be joined by our tennis player and fan producer, Reece Brassler.

With that, let’s get started. Walid, thanks very much. Welcome to The Medium Rules. Welcome and thanks for coming in and sitting down for a conversation.

Walid FATTAH: Well Alan, thank you for the opportunity. It’s a pleasure being here today talking about my business and my passion.

BALDACHIN: Let’s get into Kourts. Tell us about your app, tell us about your platform, what you’re doing, what you’re tying in, how it works, how the business makes money, etc.

FATTAH: Let me start by saying that the business model that we have is what we call a SaaS-enabled marketplace. That’s the technical word.

Basically SaaS is Software as a Solution, which for every club that’s on our platform, it helps them manage their entire facility – whether it is the court sheets with timings, whether it’s the schedule of the instructors, the database of the memberships, the rules of the club, you name it. That’s what it does.

Then you have the marketplace that we’re creating, because that Software as a Solution powers a mobile application. It’s a very similar model to OpenTable, for you and the listeners that know OpenTable. OpenTable is a software that’s in many, many restaurants, and it powers a marketplace where you can go and pick any restaurant that you want.

I think the difference from what Kourts has done is obviously it’s the first time that someone creates a marketplace where, when you download the app, you have every club that’s on our platform there.

The difference is obviously OpenTable had something that was easier; there are no private restaurants. If you’re on OpenTable, you can book any restaurant. In the tennis world it’s a bit different because you have private clubs, which today represent about a third of the market. Those private clubs only allow their members to book in their clubs.

So when we built the platform, we had to think of every supplier of tennis courts, whether it’s a public park, whether it’s HOA, whether it’s a country club, a university, a high school, all those tennis courts out there that stay empty. We had to try and build a system that allowed them all to use our platform.

The mobile app, what’s interesting is when we built our business plan, we omitted a huge part of the business, which was the instructors. So we have two apps. We have one for players and one for instructors. The one for players, for you and me and members in a particular club, you just go on the app and the app will recognize if you’re a member in a club or not.

If you remember, earlier I just said that the SaaS product in the club has the entire database of the members. So if you’re a member in Club A and your mobile number and your email are in that Club A’s database, we have access to it. Now when you download the app, your phone number is going to go into the main database of Kourts, and it’s going to see that you’re a member in a particular club.

Therefore, the app will know that you’re entitled to book in that club. That database knows if you’re a gold member, a silver member, or bronze. Clubs can create their own player types. If a gold can book from 6 a.m. till 10 p.m., maybe a bronze can only book from 10 a.m. till 4 p.m. Therefore if you’re a bronze, the app will recognize that you’re a bronze and it will limit what you can do.

BALDACHIN: So you’ve got the rules set up in there that correlate with whatever the club booking system is, whatever the rules are.

FATTAH: Exactly. I think the difficult part of what we built was being able to put as many different rules and different types of clubs on one platform.

You have clubs where you book a court – and I’m sure you know because I know you like playing tennis – some clubs will allow you to play 60 minutes, some others 45. In tennis you have clay, you have hard court, you have indoor, you have outdoor. There are so many different rules.

We really had to take a huge step back when we were building our business plan, and we had to think this out. We interviewed hundreds of clubs, hundreds of players, hundreds of pros as well, to really understand what needed to be built. We didn’t want to come to the market saying “hey, that’s what the market needs.” So that’s one of the first things that we did.

The second app, which is the instructor app, is interesting because when we built our business, at first we thought that that SaaS product, which is a cloud-based, web-based software – we thought the pros would go onto that site, they’d have a password, they would log in, and they would make their own bookings for their classes or for their private lessons for the entire week.

We forgot that pros are on the court all the time. They don’t sit with a laptop. When we realized that, the first thing we did was we said, maybe what we should do is continue our business model and create an app, not for players this time, but for the instructors, the pros.

That’s what we did. Interestingly enough, today if I look at our revenues, I think we’re almost at 50/50 when it comes to the number of bookings that go through the apps. 50% is players and 50% is the pros.

So the pros have really embraced this, and I think it’s incredible because it’s creating this community of pros. I call them our Trojan horses, because when you’re a pro in a club that’s using Kourts and then you’re a pro in another club that’s not using Kourts, now you don’t have that convenience of being able to book with your app. You’re going to have to go to the tennis director, you’re going to have to go to whoever and give your schedule for next week.

Now those pros are incredible, because they’re pushing other clubs that are not on our platform to sign up with us.

BALDACHIN: Wow, that’s interesting. To stay on that for a second, had pros been booking their own courts before, prior to this technology?

FATTAH: We’re talking in the United States here. In 90% of the cases, tennis clubs are managed by pen and paper. That means that someone has to be in front of that piece of paper to take that booking.

What the pros usually had to do is either email or text the tennis director or whoever at the reception. They have a few days ahead from players to say, “On Tuesday I have this particular clinic. I need to book my court. After that clinic, I have Alan’s kids in a private lesson.” It’s all by phone or by text or by email, and then the person at reception blocks those courts off.

When we came up with the idea of building an app to allow them to do that, once again, we had to build something that was so simple. The barrier to entry for a pro to use it had to really be something that was even more simple than sending a text or sending an email.

So we built an app – and I remember it very well because one of the discussions I had with one of my co-founders, we were like, “we need to make sure a pro can make his bookings while he’s holding a racket in his hand.” That was what we started with.

BALDACHIN: That’s what you’re shooting for.

FATTAH: Exactly. So far it’s worked out, so that’s pretty interesting. The great thing with that app as well now is for a tennis club that has clinics – you have eight people participating in a clinic, in a tennis camp. Usually the pro would take the list of the attendants and he would go on court and see who comes today.

Now with the app, he can also click on his clinic and he sees whoever is supposed to come in, and then he can check them in and the reception knows that they were checked in or not. It suddenly adds a lot of value to what we had built.

BALDACHIN: Staying on the club side for a second, what are some of the challenges and maybe distinctions getting clubs on the platform between private and public?

FATTAH: The private clubs I almost want to say are the easier ones just because obviously, if you’re a member in a private club, the private club wants to give you value for your membership. If they can give you a mobile app to book versus you having to call between 8 a.m. and 8 p.m. to book, they see the value in it.

I always take the example of if you and I were having dinner tonight and it’s quarter to 10:00 at night and I tell you, “Hey Alan, let’s play tomorrow morning at 7:00.” Well, you can’t call your club then and there because the reception is closed.

To that point, I had our tech do a best of research. Obviously right now our products are live and we have hundreds of bookings every day. I asked our tech team to give me an average time at which people pull their app out of their pocket and make their booking for the next day or for the couple of next days, or whenever that is.

I always ask clubs, “What time do you think it is?” I’ll do the same thing with you. What time do you think people pull their phone out of their pocket to make the booking for the next day or the next playing?

BALDACHIN: 9:00-9:30, I’m going to say.

FATTAH: A.m. or p.m.?

BALDACHIN: I’m going to say p.m.

FATTAH: Oh, wow. 9:47 p.m.

BALDACHIN: You’re kidding. I was literally thinking to myself – I make that decision the night before. I’m emailing, “Who’s around? Feel like playing tomorrow?” You’re not booking a week in advance, is the point.

FATTAH: Exactly. Kids are in bed, you’ve had dinner. You have time to think. Everyone’s working, everyone’s active every day, and then it’s 9:47 and you’ve got to make your booking, but your club’s closed. You’re not going to play the next day.

The convenience of letting a player decide when he wants to go and make that booking, we truly believe that’s what’s going to make more play occasions happen.

BALDACHIN: A thousand percent.

FATTAH: If at 9:47 my reception is closed, I’m not going to play the next day because I’m busy as soon as I wake up. Bring the kids to school, go to work. Now the booking is done.

BALDACHIN: That is absolutely true in the sense that for me, I play a lot on public courts in New York City. So I can do that. 9:47, I can text Reece, who we play, “I’ll meet you at 7:00 at 119th Street.” But had that not been the case, I would play a lot less. If I could make that booking electronically, you’re just going to get a ton more plays.

FATTAH: To come back to the second part, you asking me about private clubs versus Parks & Rec – again, I have no doubts that going forward, once the message is clear to a Parks & Recreation center, they’ll see the value in what we’re doing. But I think there’s two issues there.

The first one is in a lot of cases, when we speak to Parks & Recreation (and I hope they’re listening), the people that manage the recreational side, tennis or whatever it is from the recreational side, are not passionate. They’re doing their job. I’m not criticizing that, but they’re not passionate enough about tennis.

For them, the number of people on court and how much people are enjoying playing on those facilities is not a driver. That’s one of the first issues.

The second issue with the Parks & Recreation is in a lot of cases, some of the facilities are not manned. It is what we call first-come, first-served.

Take the example of you and Reece. I don’t know New York well enough, but there’s a lot of Parks & Recreation on the West Coast where you can just grab a racket, go, and you’re the first one there, you hit. If someone comes after you, there’s a ridiculous way of putting a racket in the fence so you know you’re second.

BALDACHIN: It’s a version of that here, basically.

FATTAH: I’m not surprised. To try and fix that issue, we’ve been speaking to two factories in China right now. It’s pretty interesting. We said we’d even be willing to finance this.

We would put locks on those gates with a QR code, for instance, where you have that booking, you take your phone, you scan that QR code – that QR code recognizes which gate it is, and it recognizes that you have a booking on that court. Therefore, the gate will open.

That’s one of the pilot projects that we’re trying to do now with one of the cities. But again, if I take the example of California, where we’re based (we’re in Venice Beach), we have a couple of cities down there that use our platform and they can’t get enough of it.

Once again, I think once they understand the model and the added value for the residents, for the health of their people, that they can access tennis easier, I think it’s a no-brainer.

I look at many, many cities, and we have people all around the U.S., and I look at how a city promotes their programs. Quarterly, you get a little leaflet in your mailbox and you have the different programs that are there. How efficient is that in 2018?

BALDACHIN: Flipping a little bit into the player side, is the customer acquisition strategy – are you getting players through clubs, or do you have a strategy to get tennis players, raise awareness, get them on the app, get them booking? What’s your game plan there to drive adoption?

FATTAH: It’s a very, very loaded question. It’s pretty simple. When you create a marketplace, you’ve got to have supply. You own no market unless you have supply. Our strategy from Day 1 was never to go out after the players. Our strategy from Day 1 was to convince the clubs.

I don’t like taking analogies, but sometimes for people to understand, it’s better. If you take Uber as an example, or Lyft – I could take either of them – if the first time you downloaded their app and you tried to call a car, it was 58 minutes out, you’d say –

BALDACHIN: “You’re done.”

FATTAH: “That’s not for me. I’m not going to do that. I’m going to hail a cab.” Right? And rightly so.

But Uber were pretty good, and Lyft as well, that they owned the market before they went and promoted their app.

In the same example with what we’re doing right now, if I take Los Angeles as an example, Los Angeles being our headquarters and our test city. Wherever you are in the city today, under 4 miles you can get a court. Now it becomes interesting.

BALDACHIN: On Kourts?

FATTAH: On Kourts, yes. When you can start doing that, that’s when you can start going for the players. Our strategy when it comes to the players is obviously a lot of marketing, and that’s where a lot of dollars will be spent. But mostly social media is huge. Obviously we all know that, with the influencers.

I also truly believe that the way we’ve been able to create such a huge database is clubs see the value in what we do, and they push their players to use our apps. When you have that, you have a natural inflow. Every day, we have people downloading our apps, and it’s because they’ve heard of it from their clubs, from other players in those clubs.

That’s one of the ways we built our database. The clubs are very happy about this. They’re like, “If we could inform all our members about the Kourts platform, we’d love to do that.” So we send a massive email to their entire database saying that that club is now on the Kourts platform and that they can download the app.

As soon as they do it, as I explained to you earlier, because of the architecture it recognizes that they’re a member in that specific club, and now they can go and book their courts.

We have plenty of reviews that we receive, and it’s always really comforting, and we’re all proud about it, the entire team. When you hear happy tennis players say “this is so great,” it’s something that’s very, very exciting for us.

Again, for us today, the B2B software is something that we want to promote way more than the apps themselves – although, and we can discuss about the business model, the revenue comes from the apps.

BALDACHIN: The revenue comes from the plays.

FATTAH: Yeah. The idea here is convincing a club to come on the platform. You want barrier to entry to be as low as possible, and for a lot of them they’re coming from pen and paper. When you’re taking that from pen and paper to digitalizing it, it’s a huge step. If you’re going to put a big cost on that, I’m not sure everyone would just jump at it.

What we’ve done as our business model, and it’s good for the players to know, is we always said if we want to be convenient for the players, we don’t want the price to be more expensive on the app versus in your Parks & Rec where you go, or what you have to pay when you’re a member at a club.

What we do is charge a fixed fee per transaction to the clubs when someone uses the mobile apps. If someone continues calling a club – which in a lot of cases still is the case – the club will just enter the booking onto our software.

We don’t charge anything for the software. With the software they get all the data about their club, they see occupancy rates by day, by week, by gender. Data is just unlimited on the tech that we’ve built. The revenue really comes from whenever someone uses the app.

We’re a convenient company. We want to make things convenient for tennis players because we know that if it’s convenient, as I said earlier, they’ll book more courts.

BALDACHIN: In terms of the ground game with respect to getting clubs on the app and getting adoption, is it regional? How are you scaling that?

FATTAH: We were pretty lucky from the get-go. We signed a partnership with a few big associations out here in the U.S. to try and really understand the demographics of tennis.

Even before we put the first line of code, even before I found a co-founder, I came to the U.S. – I was based in Dubai at the time, and I came to the U.S. I had to see the total addressable market, because you don’t start a business without knowing the size of the market and how you can penetrate it.

When I did that, I was like, okay, now I know how many tennis clubs. Now I know – this is all approximate, obviously, but how many tennis players, how many play occasions. But the beauty now is I know where those tennis clubs are. We mapped out all those clubs on a Google Map, and now we know where the big chunk of the market is.

Again, to the same analogy I took earlier about Uber and Lyft, you don’t have one driver in one city, five drivers in another city, and a hundred drivers in another one. What you do is own a market. For us, California has always been a huge focus because that’s where we started last year.

We didn’t branch out until we knew that our business model was right, that the product worked, that the consumers were happy using it. You listen to every single comment that comes from a club and from a player. You don’t always enjoy it, but it’s very, very important because you’ve got to listen to your consumers.

When we did that and we realized we’d got this right and California started growing, that’s when we – again, thanks to mapping out all those clubs – we always knew that Atlanta, Georgia was going to be a huge market for us, Florida was going to be a huge market for us, and the Tristate obviously as well.

So after we did California, the second investment that we did was opening a presence out in Atlanta. ALTA, which is the largest tennis league in the U.S. with 84,000 tennis players, which is huge – and this is just Atlanta – they have a huge appetite for tennis. This is soon going to become our largest market.

We’ve now also opened a presence in Florida, in West Palm Beach. We have someone there that’s now starting to sign the clubs, and we’re going to grow those teams and grow the number of clubs, and then we can promote the app to players over there.

We’re doing the same thing in Chicago right now. Chicago is a big place as well for tennis. So California, Florida, Illinois, and Georgia are our first markets. Now we’re looking for the Tristate area. We’ve hired someone as well now in New England, so we’re starting New England mid-September.

Again, the great thing about tech is once you have the tech and you’ve built it to scale, the issue will not be the tech. It’ll be obviously on the sales front.

BALDACHIN: Before we leave Kourts and get into how you guys came together, talk a little bit about your competitive set. Andy Murray recently came out with an announcement about Deuce in England. There are a few other booking apps.

How is Kourts different? How do you compare and contrast yourself and your company to some of the other guys in the space?

FATTAH: It’s a very important question. Again, when you start a business, you’ve got to look at the total addressable market and you’ve got to find out who’s there and who’s doing well. That’s the first thing – well, maybe the second thing that we did.

We did a lot of research about all the SaaS products, all the software that was out there. There’s some incredible software out there that we’re up against. You’d think that we’re nuts to do that.

But one thing that we were very lucky about – and that’s the beauty about technology – is you have a lot of software out there that built technology back in the ’80s, the ’90s, the early 2000s, when mobile applications were not out. The companies that we’re up against have this incredible software, but they’re what we call silos.

Let’s take the same example I took earlier with you being a member in Club A. If that Club A is using one of those [kinds of] software, it’s great because you can go online, www.myfavoritetennisclub.com, you put your email and your password, and now you have a court sheet where you can make your booking. In most of them, you see everyone else that’s playing. You see everyone’s name.

I’m from Switzerland, where privacy is something that is very important, banking being my background. We said, we don’t want people to see everyone’s names. So we used a different technology.

But to continue on the subject, all those big IT companies that do club management, if they wanted to do what we’re doing with an open architecture where you have all the clubs on one platform, they would have to refactor their entire tech.

Again, I don’t like using analogies, but I do it a lot. If you think of GM and you think of Tesla, Tesla has something that’s incredible. They’ve only done electric cars, so they have no legacy. Whereas if GM tomorrow wanted to produce electric cars only, they’re totally dependent today on the petrol industry.

To come back to the analogy I was making about Tesla and GM, very similarly for us, when you look at this software, for them to have to change their entire technology to be able to create a marketplace is a huge feat on its own.

So from a software standpoint we have that competition, but now we’ve realized that the technology that we’ve built – we’ve done something that’s so tennis-centric that we’ve been able to take some clubs that were using some of that software before and we’ve taken them over. I think that’s pretty interesting.

When it comes to the marketplace, we did a round of financing last year – and you, Alan, taught us a lot of things thanks to your practice.

BALDACHIN: Oh, thank you.

FATTAH: When we had to go and register the fact that we had raised funds with the SEC, that was public. You warned me about that.

But what was interesting is straight after we announced it, we had an inflow of emails – of VCs first of all, of course, because that’s their job, but then we had an inflow of emails from other apps that were out there. I don’t consider them as competition for two reasons.

First of all, you have a lot of them that are player-matching. They try to put two people together. There’s no financial model behind that. Their dream is to say, hey, I’m going to mix Walid and Alan together and they’ll get a great game. We’re going to build more and more people –

BALDACHIN: Almost a social dimension or something.

FATTAH: Yeah, almost. But for them, the revenue model – and I’ve had that conversation with them – it’s like “when we have 10,000 users, we can go to the Nikes of the world, the Babolats of the world, and then we can sell them the database so they can make advertising on it.”

The problem is, those guys usually raise $100,000-$200,000, they learn how to code, they build that, and they never get to those amounts. To be honest with you, I doubt that someone like Babolat, Wilson, Nike, to only mention a few, would see that much value in 5,000 people that are on the platform.

When they came to us, it gave me a good perspective of what was out there when it came to apps. There’s a few of them.

Deuce, the one that you mentioned – I don’t want to say we don’t look at what competition does. That’s not what drives us, but it’s always good to know what’s in that space. I think it’s great that Andy invested money in it, and I think it’s good that tennis professional players invest back into the sport because it’s a way of giving back to the sport, and I think it’s important to support the sport.

But the way they did it – when that announcement came out, I went to try and find what Deuce was. It was nowhere to be found. The technology was not finished, it was not live yet. So that silver bullet that not many people get to use, I thought, was kind of wasted.

They wanted to be, again, a matching platform. As I said earlier in this podcast, you have to own a market. You have to own supply. For us, getting people to play together is great, but that’s further down the road. What we want today is we want to own those clubs. We want to own the supply of those tennis courts.

Again, if we take the example, if one of those apps matches you and I, but we don’t have a court, we’re not playing. Whereas what we’re doing at Kourts is you want to play tennis. You can book a court. Once you have a court, in our product roadmap one of the next big chapters is we’ll be able to match you with another player.

But the beauty now is that obviously we have revenue because there’s a court that’s been done through the app, and you know that when you’re making a booking, you’re going to get a partner.

The reason why we haven’t released it there – and there’s no secret; when you’re a startup, you’ve got to talk about your ideas. The execution is everything, not the idea. The secret behind what we’re doing is we will release player matching when we have a big enough amount of players in one city. That way I’m sure that when, Alan, you download the app and you want to use it to find a partner, you’re not going to be the guy waiting for his Lyft/Uber 58 minutes out.

That’s also part of the strategy that we have. You get enough clubs, you get enough courts. Once you have enough courts, you have enough players from those clubs, you start promoting the app to get more players. Then you do player matching. That’s how we see it.

Again, when it comes to competition, I see it on the software, on the backend side. On marketplaces, I don’t see anyone that’s built something that is not a Yellow Pages of tennis clubs where you can click and it’ll send an email to that club.

For us, the supply that you have on the app is real supply. You click that court at 4 p.m., you pay $5, $10, $20, $50 – $100 sometimes, in New York – you have that court booked. It’s not sending an email to a club saying “Hey, we have someone that would be interested in playing at your club tomorrow.”

I hate saying this live, but clubs don’t read emails. They run the tennis facilities and they’re not very good at answering emails.

BALDACHIN: They do things the way they’re used to doing things, principally.

FATTAH: Exactly. That’s one of the things when we go and speak to a club. You’re disrupting a market. You’re telling someone “what you’ve been doing for the last 10, 20, 30, 50 years should be done differently today.”

It goes back to our business plan originally, when we were looking at the demographics of the U.S. If you listen to the Tennis Industry Association and you look at their numbers, they’re saying that in the U.S. you have approximately 18 million tennis players. They’re not all active, but you have 18 million tennis players and you have 28,000 tennis facilities. Facilities versus club, meaning it could be a high school, it could be parks, it could be a private club.

I tell clubs all the time, who decides? You, or the 18 million consumers? The consumer is the one that decides, and you’ve got to tell the club, if you guys don’t –

BALDACHIN: Get on the train or you’re going to be left behind.

FATTAH: Exactly. Imagine if a hotel is not on an aggregated software.

BALDACHIN: Yeah, HotelTonight or whatever it may be.

FATTAH: Exactly. It’s interesting. I can tell you they’ll get way less business. When I travel, I don’t go to hyatt.com and click that specific hotel. I go and look at what’s the cheapest room I can get.

BALDACHIN: Most people do these days.

FATTAH: Exactly. If you’re not one of those, you’re dead in the water. I feel that tennis is no different, because consumers that are going to hotel rooms are the ones that play at tennis courts.

BALDACHIN: That’s actually a good segue in terms of how you guys came together. You were in Dubai, and you’ll tell me the story, but this team really originated in Dubai.

FATTAH: Correct.

BALDACHIN: Tell me that story. In other words, what was the way that you identified this pain point, that this is what you wanted to do, and then got this group together?

FATTAH: In life, I believe in timing. I don’t know if “luck” is the right word. I think you provoke luck. But I believe in timing.

I was living in Dubai. I was fortunate enough to have a career in banking. Worked for the second largest bank in Switzerland, Credit Suisse. I’d lived in Geneva, where I grew up, in Zurich, in New York, in Singapore, in Dubai, and in Africa.

I played tennis in all those different cities and countries. When I was a kid, tennis was my sport, but I knew from an early age I wasn’t going to be good enough to take that professional. But I always kept an amateur game and enjoyed playing.

But every single city/country I had lived in, that pain point of trying to book a court was the same. And even more so when you traveled and you didn’t know the tennis environment where you were going.

I was like, how can this be possible? This was 2015. How is this possible, with the technology that we have out there, to have to pick up a phone to call to book a court?

Today I took the example of OpenTable. You don’t need to book a restaurant anymore. You don’t need to call a cab service anymore. You don’t need to call Delta or American Airlines to book a flight.

BALDACHIN: Seamless to order food, takeout.

FATTAH: Exactly. These are all habits that we have today. On the Chase app, you can transfer $50,000 without speaking to someone. But booking a court, you have to speak to someone? How is that even remotely possible?

BALDACHIN: The travel example is a great one because you just don’t do it. Unless you’re at a hotel that has a court and they’re going to find somebody, you’re going to hit with a pro for $100 bucks.

FATTAH: You got it. So I had that idea. What I did then – this is summer of 2015 – I flew to California. I like hot weather; I was living in Dubai. I went to see the space of tennis. That’s when I started interviewing clubs and looking at how poor the solutions they were using were.

I did that all the way up to New York, when I came for the U.S. Open three years ago. I was like, okay, there’s got to be something here. That’s when I started talking to the USTA, to the TIA, all those associations, to try and understand the size of the space.

Back then, when I was living in Dubai, my best friend had moved from Geneva to Dubai in 2005. One of my best friends had moved at the same time; he was starting a media company out in Dubai. It was the real estate boom back in 2005, and he and his partner had a physical magazine that was coming out every other week with listings of all rentals and apartments and villas for sale.

They started that as a paper print, and long story short, in 2008 they converted that and they went digital. They created a company called PropertyFinder.ae, which is equivalent to the Redfins or the Zillows that you have out here. Dubai was a huge market for real estate back at the time.

BALDACHIN: Still is.

FATTAH: Of course, it still is. But what was interesting is through the transition of going from paper to tech, to digital – his name is Michael Lahyani – Michael obviously learned so much about how to scale a business.

When I came back from the U.S., I sat with him and I was like, “Listen, Michael, I know you have your real estate portal and it’s linked to an app.” We started talking about it, and what was great was having someone like him, like a mentor, tell me, “Great, you have an idea now. It’s in your head. Put it on paper. Try and see what it looks like on paper.” That’s when it complicates things.

BALDACHIN: Because you have to work. [laughs]

FATTAH: Exactly. We’re going to create an app and people are just going to be able to click on a button ad book a court and pay. Okay, now what could be different? Someone might have to cancel that booking. You have different surfaces. You might not be a member in a club.

So that’s when I put everything down on paper. It took months. Back at the time, Michael, with his mentorship, he told me, “You need to bring people on board. You need to have the skills that you don’t have.” I knew as much about tech as you do with your iPhone, most probably. I had a Blackberry at the time. [laughs] I was like, “Yeah, you’re 100% right.”

I knew that from his side, he was committed to helping me build this. Obviously he was running a 300 employee business, so he had limited time to help me with this. But at the time he was acquiring a company out in Dubai called Dubicars. It was the equivalent of Autotrader and Cars.com that you have out here in the U.S. One of the co-founders was a Swedish gentleman called Tim Whelan.

Michael said, “Listen, I’ve dealt with this guy for 8 months when I was buying his company out. He’s someone that you need on board.” I’m like, “Let me meet him, but I don’t want to pitch him the business. I want to see if I can work with this guy.” Because when you’re co-founders, you spend more time with them than your family and whoever else.

So he set the appointment up. By then it’s early 2016. I sat with Tim. We had planned on having a coffee for 15 minutes; it lasted 2-½ hours. Great guy.

BALDACHIN: And he was based in Dubai at the time?

FATTAH: He was based in Dubai, because Dubicars was built in Dubai. He was previously at SAP and IBM. I wouldn’t say he knew the tech well, but –

BALDACHIN: He certainly knew enterprise platforms.

FATTAH: Yeah, exactly. With his experience with Dubicars, he had learned how to scale a business. That was very, very interesting when it came to the operational side of our business.

So we met back then and he was burnt out with all he had built in Dubai. He wanted to go kitesurfing around the world, so he went to South Africa and he went to Asia for 3 months. All that time, I was still doing my research on my own and continuing doing what I was doing. He said he’d be back on I think the 27th of March, so on the 28th of March I called him up and he came to my office in Dubai, and I pitched him.

The interesting thing is – I was not young, but immature – I had a 62-page deck. No one has a 62-page deck. A 12-page deck is more than enough. But what was interesting is when I was on page 44 going to page 45, his question on page 44, the answer was on page 45. So he understood very quickly what we were building.

When he and I then joined forces in June 2016, that’s when we really started building the product. We knew, of course, that we’d have to bring on someone that knows how to do tech. When I’m saying “do tech,” it’s not design it, but create it.

We interviewed people all around the world. Obviously we checked in the U.S., we checked in India, we checked everywhere. We looked at pricing, but not only pricing; we looked at the quality of the code.

We found an incredible team that was out in Poland. We tested them, and the person that helped us test them was one of the engineers that was working for Michael at the time at Property Finder in Dubai. His name is Ricardo Banegas.

Ricardo is an incredible tech specialist. He’s worked all around the world, all the way down to Australia, where he’s helped scale businesses thanks to his tech. He’s from Sweden as well, same as Tim is. Funnily enough, they were in high school together, so their relationship is more than 20 years old, and Michael and I as well.

BALDACHIN: And you’re all still friends?

FATTAH: Oh yeah. We’re not only friends, we’re co-founders now. [laughs] So it all works out.

I sat with Ricardo and we had long conversations, and one day he turned around and said, “I’d be interested.” I was like, “What? You’re so senior. Why would you be interested in this?” He’s like, “This is exciting.” So we sat down and had a 3-½ hour meeting, we drew what it would look like, and he said “I’m in.”

I told Michael and I told Tim, “Hey, we found a Chief Technology Officer,” and Ricardo joined us. He was living in Dubai; he moved back to Sweden, so we have offices in Sweden and in the U.S. So he’s based in our offices in Sweden. He comes to California once a month.

Then we had to hire the tech guys. When we had interviewed all those different tech companies around the world, we had found this team that was in Poland. They had built something that was similar to what we’ve built, but for spas and hairdressers. I have the same haircut as you do, so I don’t know how important that is, but there’s a lot of spas and hairdressers, and they had built the same product.

BALDACHIN: It’s a similar –

FATTAH: It’s the exact same logic. You have six chairs, you have six courts. You have four pros, you have four hairdressers. You can’t take more than capacity. They had built something that was very, very similar.

The great thing about Poland is it’s a 35 million people country, it’s a very powerful country, very ahead when it comes to tech in Europe. We started working with them. From Day 1 – and the first line of code was in December 2016 – we realized that we had found the right team. That was something that was pretty good.

Ricardo manages that team, and what we did going forward is – again, under the advice of Michael – he’s like, when you own a restaurant but you don’t have your own kitchen and you’re outsourcing the kitchen, you’re the slave of that kitchen.

So in July of 2017, I was in our Swedish offices speaking to Tim and Ricardo, and we were discussing that. We were like, okay, before this gets too big, we need to go and speak to those guys in Poland. I flew to Poland the next day and I made an offer to the owner of that dev house, and we bought them out.

Bought them out, integrated them, built our own office out in Warsaw, Poland, and now we have a tech team of nine people working for us out there.

BALDACHIN: Never looked back.

FATTAH: Oh, no. No, no.

BALDACHIN: That’s such a great instructive lesson. Very quickly in terms of Dubai, many people don’t know, but there is a startup scene there. Tell me a little bit about that scene in terms of the type of tech it’s focused on and how it gets funded. Is it principally Gulf State? What’s that look like?

FATTAH: That’s a good question. If you look at the space of venture capitalists back 10 years ago in Dubai, it was really the beginning. You had the big VCs on the West Coast here in the U.S., but [Dubai] was a market that was not really looked at.

When you look at the penetration of smartphones in the GCC, we’re more than 100% penetration. A lot of people have two phones. Again, the fact that you’re in those countries, they all are about convenience. For them, using mobile apps, using digital platforms is something that made a lot of sense.

But I think it took quite a while for foreign investors to think, hey, let’s go and see what’s happening in the Middle East. The first movers I think were Europeans, and then Americans came and saw the space. Initially a lot of the money was raised locally from friends and family, and then they realized this was something that was viable. That’s when Europe started seeing some of the interest that was coming out of the Middle East and started investing money.

We don’t have – or I should say “they”; I’ve been out of Dubai for almost 2 years now – there hasn’t been a unicorn yet, but there’s a lot of money that’s been flowing in now from the U.S. as well into those countries.

You have those local companies. I was talking about Property Finder; they raised quite a bit of money 2 years ago from a Swedish fund. You have Amazon out there right now. And obviously, what’s happened in the last 3-5 years, you have a lot of local funds that have picked up. They’ve raised money locally, they’ve raised money outside, and now they’re funding the local market.

You have companies like Fetchr that did a pretty big round of financing. If I’m not mistaken, they raised $75 million last year. So we’re talking significant tickets for those markets.

BALDACHIN: And I think Amazon.

FATTAH: And Amazon, yeah, with Souq.com. That was a pretty big deal.

Now what’s happening – when we talk about Dubai and the Middle East, we talk about the Sovereign Wealth Funds, whether it’s Dubai, whether it’s Abu Dhabi, whether it’s Qatar or Saudi Arabia. But what’s interesting is those Sovereign Wealth Funds tend to invest a lot of money outside in technology.

But what they’ve done lately now is they have their own VC funds. So now they’re looking at the local market and they’re looking at local opportunities, which I think is great for the local market to be able to be self-sustainable to a certain extent.

BALDACHIN: Are the founders principally expats or Emiratis?

FATTAH: There’s a bit of a mix. I think the incredible thing in that region as well is that there’s a huge generation right now that were educated abroad and that were exposed to convenience, technology, and to the way of living in the West. They’re very, very capable. A lot of those ventures have started with locals.

But, as you may know, in the UAE 90% of the population is expatriates. Obviously that fuels a lot of the manpower of the human capital out there, so a lot of those funded startups have foreigners in it.

BALDACHIN: Some expats.

FATTAH: Yeah, of course.

BALDACHIN: We’re going to switch gears a little bit, Walid, and I’m going to invite Reece Brassler, my producer, into the conversation. Reece, swing your chair around, get in front of the camera, and let’s do a little U.S. Open conversation. Let’s take advantage of the timing here.

All right. Welcome, Reece.

Reece BRASSLER: Thanks, guys.

BALDACHIN: Thanks for joining the conversation.

BRASSLER: Happy to join, happy to join. It’s an exciting time.

BALDACHIN: So here we are. When this goes live, we’re going to be Friday of Week 1. Let’s talk a little bit about – Walid, what are you looking for in the Open this year?

FATTAH: I think every year the U.S. Open is just such an incredible show. It’s something that’s so entertaining, whoever’s playing. Obviously I have a favorite. I’m from Switzerland.

BALDACHIN: A rooting interest.

FATTAH: Obviously, a rooting interest.

BRASSLER: Who could be from Switzerland? Who’s your favorite?

FATTAH: There’s a couple of them.

BALDACHIN: Couple of guys, yeah.

FATTAH: Let’s see who goes all the way down. But obviously Roger, with the run that he’s had since he’s come back from his injury, has been incredible. I don’t think it’s any different right now.

I think a lot of the older guys are playing incredibly well. Look at Rafa, with what he did in Canada and what he did last night. The way he’s playing is incredible. Look at del Potro, he’s still there. All the older guys, it’s incredible.

BALDACHIN: Reece, give me your thoughts so far. It looks like Stan’s looking very good on the men’s side. Obviously Simona got knocked out on the women’s side. What are you looking forward to?

BRASSLER: I use Stan’s old racket, so I’m a little partial to Stan. I like Stan. I’m just really excited about watching Novak play this tournament because he looked so good going in, playing at the Masters and since, he’s just unbelievable.

Not that I want Novak to win, but I think it would be good for the game if Novak’s just back. It’s good to see Rafa in top form, Federer coming back from the injury playing in pretty good form, and then Novak being back. And then hopefully Stan too.

BALDACHIN: Speaking of the Big Four, I wonder what happened with Andy. He’s sort of struggled to come back. What’s the word on that?

FATTAH: For the little knowledge I have about health, I think that when these guys – like del Potro having surgery on his wrist, Djokovic having surgery on his elbow – when you’re a tennis player, your hip, your knees – Stan’s knee and his hip – we’re talking surgery. We’re talking something that’s invasive.

Those guys are using their body way more than you and I. I think it’s good to take its toll after a while. You can try and fix something, but I don’t know how Nick is going to play; he pulled out of Cincinnati because his hip was hurting, and he’s still a young guy.

Those guys put so much pressure on their body – it’s one thing that you’re playing well. I think what Roger and the Top Four have been able to do is keep their level and stay healthy, which is something that I think some of the younger guys coming out there – I remember talking about how many tournaments Dominic Thiem a year. This guy is putting so much pressure on his body. What’s it going to be in 5 years from now? Can the body sustain it?

BRASSLER: And we saw Federer go out last night with the injury, and we saw the Canadian go out.

FATTAH: Yeah, Felix. It’s sad when you see these guys that have worked so hard all year round, and when it’s that important moment, something is not there physically, or sometimes mentally as well. Tennis is a very, very mental game, as you both know.

BRASSLER: You have to think about the humidity too, how hot and nasty it’s been. It just destroys your body out there.

BALDACHIN: The weather hopefully changing for the second week, as it always does. Let me ask you this, Reece: who do you think – any breakthroughs that you’re looking for? Anyone that may be not totally on our radar screen that you think might surprise?

BRASSLER: He’s probably on the radar, but Jack Sock’s just got so much talent in the ball, the way it comes off his racket, and the spin he puts on the ball. He’s unbelievable to watch. He just doesn’t put it together. I would love to see him, especially at the U.S. Open, string a couple matches together and do something.

He had that great shot last night, great little spin, and then stood there and didn’t expect it to come back, but he was in position and put it away. It was fun.

BALDACHIN: I love Jack Sock’s game as well. And you’re right, he doesn’t seem to get to the next –

FATTAH: But to what Reece said earlier, I think I would rather – I wouldn’t want, obviously, to take any chances away from Roger and those guys, who deserve it because they’re still at the top of the game – but for the game, if you have some youngsters that come through and break through with a different style and something a little bit different, I think it’s not a bad thing for tennis.

I think it’s only normal. You have generations that go through. When Roger came, and when Rafa came, although he’s a little younger, they changed generations.

I think it’s only normal after a while that it happens again, and I think tennis is ready for it. It’s been incredible to have the Top Four be around for so long, but I believe that for the sport, what would be good is if two youngsters come and battle it out in the finals. I think that’s something that would be great for tennis.

BALDACHIN: That would be exciting.

BRASSLER: Yeah, I think it would be great for tennis in terms of us as fans. I don’t know how great it would be in terms of viewership for ESPN or the tournament in general. But I think at some point we have to move on to this next gen. It can’t just keep being these four guys. What’s going to happen when Roger retires? What’s going to happen when Rafa retires? Who’s going to be there?

BALDACHIN: Just as maybe a final thought, what I think has been serendipitously nice is that these guys have stayed at the top of their game for so long, into their mid-30s, that it’s given a chance for us to get to know the next gen.

So when they do break through, they’re going to be already household names, certainly for tennis fans. Even the average, casual tennis fan, we know who they are.

FATTAH: True. Look at what Serena is doing for the women. I think it’s incredible. She’s been on the top of her game for so long now. She’s a mother. I think it’s something that obviously everyone talks about, but there’s a reason we’re talking about it, and I think it’s important.

BALDACHIN: It’s fantastic.

FATTAH: Incredible, what’s happening in the women’s game. Yesterday poor Simona Halep lost the first round. She said, “you have bad days.” I can just try and imagine how much that must hurt.

BALDACHIN: Must be tough.

FATTAH: First round.

BALDACHIN: Especially after such a great year she’s had.

FATTAH: True.

BALDACHIN: Walid, thanks so much. Reece, thanks for joining us for this last part of the conversation. Walid, thank you.

FATTAH: Thanks for the opportunity. Hope to see you all on Kourts.

BRASSLER: Yeah, absolutely.

BALDACHIN: That’s right. We’ll see you on Kourts, and we’ll do this again. We’ll get you back in for an update.

FATTAH: With pleasure.

BALDACHIN: Maybe this time next year.

FATTAH: I’d love to do that. Thank you all.

BALDACHIN: Thank you.

[Outro music]

That’s a wrap on this episode of The Medium Rules with Alan Baldachin. For more information, go to our website at www.hballp.com. You can also follow us on Instagram, Twitter, and Facebook, and don’t forget to rate us on Apple Podcasts.

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