Bassel Sabri talks with Dr. Ahmed Montasser, founder and CEO of the American Training Academy, about how startups can survive expensive money. Sabri says Egypt’s central bank has raised interest rates for the first time since 2024, that analysts see little relief before 2027, and that Treasury bills are paying around 26%. Montasser says his doctoral research on small business leaders in the Midwest and Egypt found that the companies that sustain are led by people who detect warning signals early, prepare, contain damage, recover, and then reflect and learn.
Montasser says investing in startups strengthens the economy and creates jobs, and that higher risk can mean higher gains than Treasury bills. On borrowing, he says a loan makes sense when it funds productive assets for a growing business, but that borrowing to cover losses only postpones the problem. With early-stage deal numbers across MENA down by almost half this year, according to Sabri, Montasser advises founders to start lean, validate demand and pricing, and focus on building revenue and profit from day one, since investors will ask whether a business is profitable and scalable.
Montasser also discusses the Business Model Canvas, which he describes as a tool for understanding how a business creates, delivers and captures value through nine building blocks. He says founders most often miss the connection between customer segments, revenue streams and cost structure.
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Egypt Raises Rates for the First Time Since 2024 and Startups Feel the Squeeze
Bassel Sabri: Egypt’s central bank has raised interest rates for the first time since 2024, and analysts see little relief before 2027. For entrepreneurs, that changes the math when Treasury bills pay around 26%. A startup has to offer investors more than [unclear: “just”] to get a meeting and survive long enough to deliver. So how exactly do you build a business that can live with expensive money? Well, joining me now is Dr. Ahmed Montasser, founder and CEO of the American Training Academy. Thank you for joining us.
Dr. Ahmed Montasser: Thank you so much for inviting me, Mr. Sabri. It’s my honor and pleasure to be with you today.
Bassel Sabri: So, Ahmed, your doctoral research looked at how small business leaders can actually handle a crisis. Now, with a rate hike, a weaker pound, and costs still rising, what separates the companies that get through a squeeze like this from the ones that don’t?
Dr. Ahmed Montasser: That’s a great question, because when we look back, the main key that differentiates the companies that sustain is the leaders. We are talking about leaders who have crisis management skills that allow them to sustain. When I did my doctorate degree, I interviewed many business leaders in small companies in the Midwest region of the United States and in Egypt, and I was exploring what crisis management strategies allowed them to sustain their business despite uncertainties, whether it was a natural disaster or a human-made crisis. I found that leaders who can detect warning signals early, who have prevention and preparation, who can really contain the damage and have a business recovery, and who, after the crisis, go back and learn and reflect, are able to get through those challenges and uncertainties that we can face right now in the economy. So it’s all about the quality of leadership that you have in the organization.
Bassel Sabri: Right. Leadership is definitely important, but when you have Treasury bills paying around 26%, if you are an investor in Cairo yourself, why put the money into a young company instead? And what does the founder have to prove to win that kind of argument?
Dr. Ahmed Montasser: Yeah. Actually, when you are investing in startup companies, you are mainly strengthening the economy and opening new job opportunities for others. And definitely the risk is higher, so the gain might also be higher compared to if you just go to Treasury bills. It’s not only about making profits in the short term, but about how you can invest in people who identify real problems in the market and have a very promising business that can grow through the long-term journey as an investor.
Bassel Sabri: And with policy rates above 20%, when does a bank loan still make sense for a small business, and when does that become the thing that actually sinks it?
Dr. Ahmed Montasser: Actually, that’s a great question, because we need to focus on whether you borrow money for productive assets, because you are scaling and maintaining a growing business, or you just have a loan because you want to cover your expenses and losses. If you are going to borrow the money because you are really growing and have productive assets, that’s the major decision, and you can definitely go for it. However, if you just get loans because you want to cover your losses and sustain yourself in the business, you are now postponing the problem, and at the end it will come back to you. So as an entrepreneur, it’s not about just wanting another investor coming and doing another fund just to grow. It’s about, are you really making success? Are you really making profits? Are you really making a sustainable business that can be competitive despite all the uncertainties and challenges that we are facing right now? That’s very important.
Bassel Sabri: Yeah, that is important. And it raises another question, since startups are always looking for funding and founders are always looking for funding. Recent data shows early-stage deal numbers across MENA are down by almost half this year. Now, if the next funding round may never come, how should a founder plan their cash differently from day one?
Dr. Ahmed Montasser: First, they need to start lean and keep the startup cost low. If you keep the startup cost low, that’s very important, because you are starting lean and keeping your overhead low. So the first point here is start lean. Make sure that you have a low startup cost. Then you need to validate. You need to validate the demand, because you need to make sure that your customers are still there. Are they still affording your product? Or do you need to change the pricing strategy, or do a lot of different things for your customer, like introducing a new product? All of those things you need to think about. Third, you need to know your [unclear: “financial. Type like founders always will ask you how much this cash will help you to survive this return. It is certainty that revenue early”], like from day one. Ask yourself this question: how can I build the revenue and how can I make the profit? Not just raising funds and making sure that you have a lot of money coming in. It’s about how you can really sustain, because investors will look at your business the same way. Is it really profitable, and is it really scalable?
Bassel Sabri: Now, you have written about the Business Model Canvas as a planning tool. Now, when the cost of money can jump overnight, which part of that canvas do founders most often get wrong?
Dr. Ahmed Montasser: Actually, let me highlight something here. When we talk about the canvas, we talk about a tool that helps entrepreneurs understand how their business creates, delivers and captures value through the nine building blocks. So, to answer your question, we need to [unclear: “look for something here”]. Founders frequently need to ask about the customer segment, the relationship with the revenues, and the cost structure. As you know, in the nine building blocks, we always think about customer segmentation all the time during uncertainty, and how this is connecting to my cost structure and my revenue stream. So in my opinion, entrepreneurs always miss the connection between those three blocks in the nine blocks of the Business Model Canvas.
Bassel Sabri: Thank you very much for highlighting this point. I hope that startups and founders are actually watching. And thank you for joining us today. Very valuable insights. We hope to have you on once more very soon. Thank you.
Dr. Ahmed Montasser: Thank you so much, I appreciate it.