From sharing a single desk, to selling over 1 million units across two countries, the story of Egypt-based medical dermatology and cosmeceuticals specialist, Cleo is a winding tale.
A roadblock met them, however: the formulations were incredibly expensive. Not about to stop in their tracks, Moenes and Helmy struck a partnership.“Every night, as I would walk up the stairs to my apartment, I’d look at my car and think ‘I’m going to have to sell you’,” Salah Moenes, co-founder of Cleo Laboratories, tells StartupScene.
It was at this stage that Moenes and his partner, Mohamed Helmy, had thrown all their eggs in one basket, thrown caution to the wind, taken the kind of risk that made no sense on paper: entering the world of cosmeceuticals.
Entering into a sector that had traditionally been dominated by global names - and doing so with no experience - doesn’t seem like the smartest move for a man whose background is rooted in finance and investment banking. But like all innovators looking to make an impact in an entrepreneurial ecosystem that is forever changing and evolving, Moenes and Helmy saw an opportunity.
“Post-floatation, almost all imported goods across different sectors became very overpriced,” Moenes recalls of a uncertain 2016 for the Egyptian economy. “That gave local producers the competitive edge needed to compete in the market.”
Still, the choice of cosmeceuticals is, on the surface, a peculiar one. Moenes and co. weren’t entering completely blindly, however, and through doing their due diligence, they discovered a sector ripe for a local company to jump into and lead the way.
“I discovered that the cosmeceuticals industry in Egypt is very promising for several reasons,” Moenes continues, clarifying that the post-floatation price hike of imported goods was only one of the reasons he chose to dive into the field. “The market was highly under-penetrated, but it also has the advantage of having no regulations for price caps, unlike the rest of the pharmaceuticals industry.”
Their eyes lit up and the road to founding Cleo Laboratories began.
In 2017, Moenes and Helmy got to work, sharing one space at a coworking office. Almost five years on, Cleo’s products can be found in over 3,500 pharmacies across two countries; it boasts a sleek ecommerce website that showcases its range of 35 products under two brands; and that team of two sharing one desk have become 60.
Like any good bootstrapping, entrepreneurial tale, this success didn’t happen overnight and Moenes and Helmy’s road was one of potholes and twists.
Step one was undertaking a mountain of intensive desk and field research on a market that had barely been looked at. So intensive was said research, that Moenes recalls that they put together an incredible 5,000-slide package that covered all any relevant elements of this scary new world they were entering into. We covered all competition on a local, regional and global front,” Moenes recalls. “We also covered the function, benefit and use of each and every active ingredient used in cosmeceuticals.”
Amidst the stack of slides, Moenes and Helmy came to realise that cosmeceuticals is a high-volume, high-margin industry and discovered that it was in fact a defensive industry, one almost immune to economic fluctuations, recessions and, indeed, currency flotations. Throw in the additional fact that the industry is low capital intensive - meaning that the pair would spend little on assets - and Moenes and Helmy were onto a winner.
Weary of what they call in Egypt ‘the foreigner’s complex’, Moenes and Helmy understood that ‘local’ often equated to ‘low quality’ in people’s minds. That’s why when they began looking for the ingredients and formulations that they would use, they went to one of the biggest formulaters in the world, based in Paris.
“We were very lucky, actually,” Moenes tells us. “When we tried to work with formulaters in Egypt, we could only get ready-made formulations. “So we contacted a formulation company based in Paris and they actually responded - I have no idea why!”
With the wind in their sails Moenes and Helmy moved forwards, with the help and support of Lamis El Dardir (Head of Marketing); Adoub Ezz El Din (Head of Research & Development); Donia Salam (Head of Operations); and Dr. Amr El Bayoumi (Medical Director).
Now, Cleo boasts sales over 1 million units, over 50% of which has come through its website, which was an almost off-the-cuff venture as a response to the onset of the pandemic in early 2020. Their products cover all dermatology indications and there’s plenty more in the pipeline.
“Over the next 12 months, we are shifting our business model from a medical-based company to an OTC pharmaceutical-based company,” Moenes says with a steely determination, no doubt shaped by the tough road behind him. “ We’re also launching dental care, gynaecology products, paediatric products and even makeup line.We want to have a range of products that caters to both genders, all age groups and, ultimately, all needs.”
“On the international level, Cleo is now available in two countries, however we are finalising export deals with five countries in the MENA region, Eastern Europe and Latin America,” Moenes adds about Cleo’s ambitious international expansion plans. “We have a solid road map to be present in 35 different countries over the next five years.”
Not bad for a couple of enthusiastic 20-something year olds with nothing more than ambitions of building something from scratch - the very same ones that were sharing a single desk. Moenes’ car? He never sold it and it now sits almost as a monument to his achievements.