What Lebanese Banker Marwan Kheireddine Learned From Richard Branson
Marwan Kheireddine has brought an immeasurable amount of wealth and growth to Lebanon. In 2001, he opened a Virgin Megastore in Lebanon and received some priceless advice from a fellow billionaire, Sir Richard Branson.
“I saw how Richard runs his business. He runs a multibillion-dollar corporation, but he knows everything about every company every day because it’s a flat structure,” Marwan Kheireddine said. “So when I met him for the first time in his office, I was very surprised that he was in a large office with no windows, no walls — it was completely open.”
Kheireddine found it intriguing that anyone could walk up to him and talk to him.
“His assistant would sit next to him, and there were no walls, and no red tape,” Marwan Kheireddine said. “And I did exactly that. If you come to my office today, unfortunately, we have walls because that’s the way it is in banking. However, when I don’t have people in my office, my door is open. Anyone can come in from the lowest level analyst to the highest C-suite executive. They can come in. It’s an open-door policy.”
Marwan Kheireddine had a life-changing meeting with Richard Branson
When Marwan Kheireddine met with Branson at his London offices in 2000, he assured the British business tycoon the launch would have to unfold grandly.
“I said, ‘Richard, if you want to launch Virgin in the Middle East, it cannot be done in a shy way,’” Marwan Kheireddine advised. “It needs to be done very professionally and with a huge impact.”
The Virgin Megastore opened in 2001, and it quickly became a cultural hub in the heart of Beirut. Branson attended the opening perched on a black couch that had been loaded onto a red bulldozer’s forklift bearing Virgin’s iconic logo. An elaborate fireworks display followed. Lebanon’s late Prime Minister Rafic Hariri described the store as a testimony of Beirut’s revival, according to albawaba.com.
And then, a Virgin Megastore opened in Saudi Arabia in 2008. “Again, Richard went there, and we launched Virgin in the Middle East, but we didn’t stop at Virgin Megastores,” Marwan Kheireddine said. “Virgin Megastores then had a radio station, and Virgin Radio opened up in Lebanon.”
Virgin ultimately created many new jobs in Lebanon, according to Marwan Kheireddine. “At the peak, we were employing around 400 people. We are employing fewer people now because the industry changed,” Marwan Kheireddine said. “So, at the time, Virgin was the place to go to buy anything that has had to do with entertainment: CDs, DVDs, multimedia, computer programs, magazines, books — you name it. We even had cafés and restaurants open.”
The decline of the compact disc reshaped how music is sold
Over time, the whole industry shifted as music went digital. Suddenly, CDs were not in demand, and the MP3 era took flight.
“People no longer buy music. They buy music online. They no longer buy a CD,” Marwan Kheireddine said. “So the whole business model changed. And as it was changing, we were barely breaking even, mostly because of the lack of support of the Lebanese government to our business. And we basically could not control the black market where illegal copies of everything would be sold, from CDs to DVDs to computer programs.”
Marwan Kheireddine soon found himself competing with ghosts in an already shrinking industry. Smaller shop owners were purchasing iPhones and Sony PlayStations in Dubai and not paying customs duties on the items. So Marwan Kheireddine opted to keep the Virgin Megastore in Lebanon despite the store becoming less competitive.
“In certain years, I would lose some money. I would make some money in other years,” Marwan Kheireddine said. “Overall, it was plus or minus equal, but I decided to keep it because again, it put Lebanon on the map, and every time we did an event in Virgin, we were on CNN, on Euronews, and it was promoting a good image for Lebanon .”
Marwan Kheireddine was also proud of all the concerts Virgin Megastore in Lebanon hosted.
“From Pavarotti to Air Supply to Bryan Adams, we organized hundreds of concerts,” Marwan Kheireddine said. “And every single one of them would put Lebanon in a nice piece of news in the international media.”
The beat goes on
Marwan Kheireddine’s name is now synonymous with Virgin Megastore in Lebanon, which is an accomplishment he’s still proud of 20 years later. Although Virgin Megastore’s flagship location at Lebanon Opera House shuttered in 2018, the brand is still going strong in shopping malls throughout Lebanon.
“In Lebanon, when you say Virgin, everyone knows that it’s me. It’s my group. So the goodwill of Virgin helped the bank grow as well,” said Marwan Kheireddine, the chairman and general manager of AM Bank. “So my benefit was indirect, so to say, but nonetheless, it still exists today. In every shopping mall in Lebanon, you have a Virgin Megastore. We have the Virgin Megastore and the duty-free at the airport. And it is still there.”
The Virgin Megastore is now a prominent place to go for books, according to Marwan Kheireddine. The retailer also sells quirky board games, popular video games, cameras, Apple products, and gadgets.
“Books are very big now. So we’re selling everything that has to do with multimedia and electronics,” Marwan Kheireddine said. “And we’re not selling music except for nostalgic things. So we’re selling vinyl records now because there is a trend. People want to buy the old vinyl 33 LPs. So this is the business now.”
In addition to job growth in the region, Virgin Megastore has also contributed to those less fortunate, delivering more than a thousand gifts to orphans and children of impoverished families throughout Lebanon. Giving back to his homeland is a quest Marwan Kheireddine remains passionate about.
“You have no idea how satisfying it is to see that you’ve influenced someone positively and made their life slightly better than it would have been had you not influenced it,” Marwan Kheireddine said.
Originally published at https://techbullion.com on December 23, 2021.
