Maktoob moves towards profitability
Maktoob.com the company which first introduced Arabic email is almost a year away from breaking even
Maktoob.com is almost 3 years old, keeps gaining momentum, has a diversified revenue stream and unlike some other Internet companies, says it is well on its way to breaking even. The company expects this to happen by the first or second quarter of 2002.
Samih Toukan, CEO of Maktoob, attributes the success to being innovative and the first mover to the market. “Maktoob was the first to provide Arabic e-mail solutions but we also succeeded in marketing a simple brand in line with customer feedback,” said Toukan. Maktoob has 800,000 active visitors a month to its site, who use the e-mail, chat and forum services.
The company was not well financed when established in October 1998 but managed to secure $2.5 million from the Egyptian based financial services firm, EFG Hermes. Although Toukan declined to mention the burn rate, he explained the company has several revenue modules in place and intends on enhancing them in the future.
Although Maktoob derives 50% of its revenue from advertising the remaining portion comes from a variety of streams. According to Toukan, the company’s business solutions play an equally important role.
Maktoob has been able to license its e-mail and instant messaging services to other companies in different industries. “We help other corporations and entities build their communities and have done this with iHilal.com, Arab Finance, Dawalej and will shortly be announcing a deal with a telecommunications company,” said Toukan.
E-commerce has not been a major source of revenue according to Toukan. However, the company has recently teamed up with Aramex to carry out cash on delivery shipments. Toukan believes that “e-commerce will incrementally grow starting with the shopping mall which the company has tried to integrate with its customers overall experience.” Mazad, the free auction service, is also expected to add value.
While Toukan said that Maktoob has no immediate plans to merge or acquire other entities in the near future, the company has recently acquired 40% of Rightscore.com, interactive sports related service that is based in Egypt.
In the medium term, Maktoob is considering a credit card market place as part of its offering and is currently in negotiations with several financial entities. An alliance with a major Internet service provider (ISP) in Saudi Arabia will be announced in the near future and is expected to generate another source of revenue. Toukan also indicated that the company is entertaining the prospect of engaging the offline world but declined to elaborate.