IBD BLOG – TEAM MAJID AL FUTTAIM

Written by: Jorge Tellez, Ryan King, Jennifer Rokosa, Daniel Clayton and Kelly Gillfillan

Entry 1: May 17, 2018

The five of us (Jenny, Daniel, Kelly, Ryan, and Jorge) touched down in Dubai five days ago and were greeted by 105-degree heat and a 4-day long sandstorm. Dubai has a giant desert in its backyard, and if the wind is blowing strong enough in the right direction, the entire city gets hit with a wall of sand. From the street, a sandstorm just looks like a foggy day (not quite San Francisco level fogginess, but close), but if you run your fingers across any outdoor surface, you can immediately see the layer of sand blanketing everything.

The jetlag is finally starting to wear off for most of us. Dubai is 11 hours ahead of Berkeley, meaning we’ve been hitting the coffee pretty hard. However, starting today, we’ll be drinking those coffees in a large closet at Majid Al Futtaim’s (our host company) headquarters. Let me explain…

Team Majid Al Futtaim at the Cultural Center

Team Majid Al Futtaim

Today is the first day of Ramadan in the UAE, meaning most Muslims are fasting for the whole month. Between the hours of 4am and 7pm, it’s is not permitted (whether Muslim or not) to eat or drink in public, including in the office. So while we’re on-site, we’ve been instructed to keep any eating or drinking restricted to a small pantry area on the fourth floor—don’t worry, they have an espresso machine in there.

We head to the UAE cultural center later today where we’ll learn a little bit more about the history of the country, the traditional dress, food and customs. This weekend, we’re heading out to the desert on a guided tour, and then to Abu Dhabi to check out the sights there. Pictures to follow!

 

Entry 2: May 24, 2018

Somewhere between hanging out with two dozen penguins at the foot of an indoor ski slope and watching tourists scuba dive with sharks inside a three story aquarium, you realize the words “shopping mall” in Dubai mean something very different than they do back in the states.

Penguins

Penguins

For us, five millennial Americans dropped into the Middle East for the first time, the word “mall” evokes imagery of angsty loitering teens, sticky movie theater floors, and CDs with the parental advisory warning peeled halfway off (I don’t know about you, but that’s the only way my parents would let me listen to Eminem). Conversely, malls in Dubai have less to do with shopping and more to do with mind-blowing art installations, architecture, five-star restaurants and hotels, movie theaters where you’re served three-course meals, and did I mention, PENGUINS!

This is all to say that while malls in the US have been dead for nearly two decades (thanks, Bezos), they’re thriving here in Dubai. Why? A couple reasons:

  1. E-commerce hasn’t had nearly the same impact here as it has had in the states. Online sales penetration stands at just 2% of total retail sales in the Middle East and Africa, compared to over 10% worldwide.
  2. It hot. Really, really hot. Six months out of the year its too hot to go outside, so heavily airconditioned malls are absolutely the place to be.
  3. The folks at Majid Al Futtaim (our host company) and Emaar (their primary regional competitor) realized a long time ago that experiences would be the way forward for brick and mortar retail. Hence why malls here are built around incredible, experiential attractions.

That last point, which doesn’t really sink in until you’re watching a fountain show at the base of the tallest building in the world, left the five of us asking “How are we going to add value here when this company is so far ahead of mall operators in the US?”

Sitting in Silicon Valley, its sometimes easy to think the US is at the forefront of virtually every industry, but our ignorance was made abundantly clear with just one lap around the Mall of the Emirates. Our recommendation to Majid Al Futtaim was not going to be as simple as relaying what mall operators in the US are doing. Instead, we’d have to figure out how a company that is performing quite well can continue to innovate in the retail space, and how they can even better prepare to defend against e-commerce, which we’d be naïve to think Dubai is immune from.

More next time from Team Majid Al Futtaim!

Entry 3: May 31, 2018

We presented our final project today! The last week and a half was filled with almost a complete overhaul of our presentation, as we homed in on some key recommendations for the company and what we envision the mall of the future will look like. If you had asked me a month ago, my vision of the mall of the future would have been precisely the malls we saw on this trip, but there are some really interesting regional dynamics that lead us to believe a lot may change behind the scenes for malls in the Middle East.

A good example is everything happening in Saudi Arabia today, where the crown prince is loosening up a lot of restrictions, allowing women to drive for the first time and allowing movie theaters to reopen after a more than 30-year ban. Majid Al Futtaim, who manages Vox Cinemas, has plans to open 300+ screens in Saudi Arabia in the next year.

From the dozens of conversations we had with Majid Al Futtaim employees over the last three weeks (including the CEO), it seems absolutely key for malls to position themselves as “experience centers” going forward, as opposed to shopping-only centers. This means more movie theaters, gourmet restaurants, and leisure activities—like an indoor ski resort, for example, or a giant aquarium full of sharks! (Those last two already exist.)

We also believe that the relationship between mall operator and tenant (retail stores) will change in the coming years. We’ve seen a ton of direct-to-consumer brands realize that their e-commerce presence isn’t quite enough, and that they actually need a brick and mortar presence to round out an “omnichannel” offering (e.g. Warby Parker, Everlane, Casper, and dozens more). We think this will be one of the primary retail models going forward, meaning that there will be a host of online-only retailers looking to move into the brick and mortar space through pop-up shops and showroom-style stores.

Mall operators can take advantage of this trend by pioneering what we’re calling a “store-as-a-service” model, whereby the mall operator provides everything required to build and run a store, making it very easy for brands that do not have a physical retail presence to create one quickly. This would also have the benefit of attracting fresh, new retailers to the UAE by offering a de-risked and less capital-intensive entry to the country.

We’ve also been really impressed with Majid Al Futtaim’s commitment to sustainability. Most of their buildings and hotels are LEED gold or platinum certified, which is no small feat. Further, they have a goal to be “net positive” in carbon and water by 2040. Jenny absolutely nailed her piece of the presentation, which focused on how the company can make progress towards achieving that goal by partnering with clean building technologies (at Berkeley, for instance) and helping them through the commercialization phase, which is often known as the “valley of death” for cleantech given the number of companies that fail at that stage.

Team MAJ enjoying dinner after their presentation

Team MAJ enjoying dinner after their presentation

Our presentation was very well received, and we’re thrilled to hear they’re interested in many of our suggestions. We look forward to being in touch with the team in the future and we’re incredibly thankful for the opportunity to work with them all.

We went out on the town to celebrate the end of our project and this journey last night. We shared highlights over pizza and drinks and then packed up for the 15 hour flight I’m currently on now. I think we’re all excited to get back stateside and start our internships, but sad at the same time that this amazing journey has come to an end.

That’s it from us (Jenny, Dan, Kelly, Ryan and Jorge)! Thanks for reading!

IBD Team YGA Travels to Istanbul to Work with Young Guru Academy (YGA) for a Second Year

Written by Team YGA: Joanne Lee, Clara Jiang, Enrique San Martin Petit and Daniel Mombiedro

After a successful inaugural engagement between Young Guru Academy (YGA) and IBD in 2017, the two partnered again this year to send a team of four MBA students to Istanbul, Turkey. The IBD team was tasked with assessing the potential of virtual reality tours to develop a go-to-market strategy and revenue model. Piri – one of YGA’s most promising startups – wants to expand beyond its current travel app which offers only GPS-based tracking audio tours. The value that the Berkeley Haas IBD team would be able to deliver was unique – situated in the hotbed of innovation with VR companies like Oculus, YGA understood this advantage. I had the privilege of being a member of this IBD team and embarked on my first international work experience.

A day in the life:

My alarm goes off at 7:30AM. I quickly get ready and head over to the dining hall for breakfast. Dining hall? Yes, that’s right – my team members and I are staying at Özyeğin university where one of YGA’s offices are located. I assemble on my tray a typical Turkish breakfast – eggs, cucumbers, tomatoes, cheese, and simit, a circular bread encrusted with sesame seeds. I pour myself a cup of hot tea and join my team members in the discussion of today’s agenda.

An elaborate traditional Turksih breakfast spread at a café

An elaborate traditional Turkish breakfast spread at a café

Today’s agenda: a Piri tour of Karakoy, a brief 30-minute meeting with the CEO of Turkcell (the largest tech company in Turkey), self-study time for our team to get some work done, and wrap-up with a dinner party hosted by Sezin, a YGA colleague. I am excited to do a little sight-seeing of Istanbul which qualifies as product testing – perks of working with a travel tech startup.

We arrive at the starting point of the Karakoy tour, a beautiful mosque with two minaret towers, and are promptly greeted by Çağlar, one of Piri’s co-founders. We all plug in our earphones and begin following the instructions from the audio tour. The experience is seamless – as I stare up the intricate details on the dome ceiling, I hear about the rich story behind the mosque. The tour concludes with us reaching the harbor with a spectacular view of the glistening Bosphorus river. After snapping some photos, we stop in a café. Over baklava, we provide feedback to Çağlar on our experience with the tour. Eventually, it is time for us to meet with Kaan Terzioğlu, Turkcell’s CEO – we don’t want to be late and Istanbul’s traffic is unpredictable.

IBD Team on the Karakoy Harbor with Çağlar, one of Piri’s co-founders

IBD Team on the Karakoy Harbor with Çağlar, one of Piri’s co-founders

Again with an unobstructed view of the Bosphorus River, I am sitting next to Kaan in a large conference room. My team members and I are presenting our research on the VR industry and getting a rare look at how the CEO of a major tech company conducts himself. Kaan is engaged, nodding, and occasionally interjecting with an insightful comment. After the meeting, we collect our notes and head back to the YGA office.

We settle into an empty conference room and get to work. Daniel Mombiedro, our team lead, starts going through our slide deck and proposing changes to be made. We all offer our thoughts on how to best reflect the new information from today. We are a collaborative team – discovering, discussing, and delivering together. After several hours of tweaking models in Excel and putting together slides, we’ve made good progress. A YGA colleague swings by to offer us a ride to Sezin’s dinner party. We pack up and prepare to sit through more traffic.

Upon arrival at Sezin’s apartment, I kiss cheeks one-by-one with everyone there. As an Asian-American raised in New York, cheek kissing is uncommon. Through these warm embraces, I feel a strong sense of the close-knit family that YGA has formed. Sezin has prepared a bountiful feast with a variety of meze (similar to tapas). With full plates, we sit around the living room and chat with YGA members to learn about what drew them to YGA. I am particularly inspired by Küşat’s story – Küşat, who is visually impaired, is working on the world’s most advanced smart-cane, WeWalk, that detects obstacles above the waist and integrates third-party apps through voice-activation to lessen the everyday challenges of the blind. At the end of the night, my team packs into a van to return to our dormitories – it’s been a long but eventful day and I’m excited about what tomorrow holds.

Updates from IBD Turkey – Touring Turkey with YGA and The Turkish Delights

Written by Amol Borcar, Annie Porter, Chelsea Harris, Jeanne Godleski, and Mariana Martinez

The room was buzzing with three languages, and communication was a game of telephone. One of the Syrian primary students would excitedly share something in Arabic, at which point it was translated into Turkish by a Syrian university student, and then a staff member from Young Guru Academy (YGA) would share it in English with our Berkeley-Haas IBD team of five. Nuance was definitely lost through these piecemeal verbal communications, and we came from radically different backgrounds – lives interrupted by the Syrian Civil War, educations defined by a single test score, and former careers in consulting, software engineering, and clean energy. Yet there was one language in the room that we all understood perfectly – science.

YGA university student volunteers leading a science workshop with Syrian primary school students in Gaziantep. Annie concentrating hard on remembering how electrical circuits work!

Our team, fondly nicknamed “The Turkish Delights,” was at one of YGA’s science workshops with Syrian refugees in Gaziantep – a city in southeast Turkey, just 20 miles from the Syrian border. At first glance, this activity seemed somewhat removed from the formal scope of our project with YGA – developing the strategic business plan for the new Aziz Sancar Science Center, set to open in Istanbul in 2018. We were struggling to understand how participating in YGA’s science workshops in Gaziantep and Trabzon would inform our marketing and financial plans for the Science Center. Coming from high-pressure, deliverable-oriented careers prior to Haas, we all wondered if our time would be better spent at our computers, modeling projected visitor numbers and coming up with creative marketing tactics. The business plan was the whole reason we were here after all, right?

Mariana answering the hardest of science questions, like “Where is Mexico?”

Mariana answering the hardest of science questions, like “Where is Mexico?”

Now in our second week, we have realized the immense gift YGA gave us by immersing us in their culture, projects, and relationships for the first week. Coming into our in-country time with YGA, we knew it would be anything but your typical client-consultant relationship given our interactions from Berkeley, but this experience has exceeded all expectations.

On paper, YGA is a non-profit organization that cultivates “selfless leaders” who will create a brighter future for younger generations through innovative, community-based programs and technologies. These projects include Science and Innovation Workshops, My Dream Companion for the visually-impaired, and the Young Leaders Program for high school students.

When the students insisted on giving us a Turkish dance lesson at the end of one science workshop, we couldn’t say no!

When the students insisted on giving us a Turkish dance lesson at the end of one science workshop, we couldn’t say no!

However, the projects themselves are merely tools that YGA uses to instill confidence, humility, and optimism in Turkey’s young generations, with the hope that they will one day lead more socially-conscious organizations and companies. The process of implementing these projects – the planning, the evaluation, the personal growth – is the true goal and measure of success. For example, we ran three separate workshops – one for Syrian refugees, one for orphans, and one for underprivileged students – and although we couldn’t communicate perfectly in any of them, science gave us common ground to which to connect. After each workshop, we paused to reflect on how the students interacted with us and the material, and we all left having learned something about ourselves.

Amol mastering a self-driving car with Syrian students at a science workshop in Gaziantep.

Amol mastering a self-driving car with Syrian students at a science workshop in Gaziantep.

This has been a very new way of thinking and working for us, as we come from jobs where the destination – what you produce – is far more important than the journey. Only by experiencing YGA’s model firsthand could we internalize the notion that success can also be defined as a thoughtful, self-reflective process that leads to personal and collective growth.

Our client Duygu giving us the rundown of all the delicious homemade Turkish dishes!

Our client Duygu giving us the rundown of all the delicious homemade Turkish dishes!

YGA has made us feel like family, from inviting us to a homemade Turkish dinner at our client’s apartment to including us in their weekly executive leadership meetings.

The future location of the new Aziz Sancar Science Center at Istanbul Technical University’s (İTÜ) Maçka campus, which currently holds very outdated science and technology exhibits.

The future location of the new Aziz Sancar Science Center at Istanbul Technical University’s (İTÜ) Maçka campus, which currently holds very outdated science and technology exhibits.

We have now lived and breathed the YGA way and will deliver a business plan for the Science Center that integrates both the tangible programs and intangible values that define this incredible organization. Earlier this week, when we visited the building in Istanbul where the Aziz Sancar Science Center will open next year, the impact of our project felt more real than ever.

These two weeks have been a blur, and we don’t anticipate it slowing down for the remainder of our time. While we’ve had to squeeze time at our computers into odd hours given the packed, immersive days with YGA, we have still managed to find moments to explore Turkey’s rich cultural – and culinary – offerings! We spent a few hours touring Trabzon with a very jolly tour guide who shared all of the local jokes and stuffed ourselves with Gaziantep’s world famous katmer!

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We have also been befriending Istanbul’s well-cared-for stray cats and popping into the city’s gorgeous mosques at every chance.

The full depth of the IBD experience likely won’t hit home until we are on our return flights or starting our summer internships because it is so much to digest both personally and professionally. We all know, however, that YGA has forever changed how we define success.

Amol, Mariana, and Jeanne visiting Istanbul’s Süleymaniye Mosque.

Amol, Mariana, and Jeanne visiting Istanbul’s Süleymaniye Mosque.

Updates from IBD – Team Dubai

Jonathan Prowse, Davis Jones, Haruna Yasui, and Nikita Jain are full-time MBA students working on an International Business Development project in Dubai, UAE with a local engineering and manufacturing startup company.

 

Team Background

With close ties to the Silicon Valley, Berkeley Haas is distinctly renowned for its academic thought leadership and industry expertise in the fields of management, entrepreneurship, and technology. As such, we were each drawn to the Haas MBA program from all corners of the globe – hailing from New York, Toronto, Bombay, and Tokyo – with aspirations of pursuing careers in entrepreneurship and VC.

Collectively, we possess diverse skillsets, with industry experience across financial services, education, and engineering. Upon receiving our assignment for our International Business Development (IBD) class, we found common ground through these complimentary skillsets and our shared interests in entrepreneurship. We were fortuitously partnered with a startup in Dubai to assist in the development of a market expansion and go-to-market strategy for their innovative, engineering solution for buildings systems.

The project allowed each group member the opportunity to apply or prior experiences, coupled with tools and skills developed throughout our first-year coursework, to a project that perfectly aligned with our collective and respective career goals in entrepreneurship and VC. Surrounded by the often-glamorized culture of entrepreneurship in the Bay Area, it’s safe to say that we failed to fully anticipate the significant challenges and tremendous ambiguity that a nascent company faces in its early stages…

(Specific project details cannot be discussed due to the sensitive nature of the company’s patent-pending technology and competitive strategic positioning)

 

New Challenges

We arrived in Dubai to a very different project than the one we had anticipated. Our client had entered into a breakthrough partnership agreement with an international supplier within days of our arrival, and accordingly, their business needs and future development plans had shifted dramatically. We had spent the previous four months conducting industry research for our proposed market sizing project, but the new partnership agreement created a new, pressing need for further capital investments to support the growing venture. There was no way to anticipate this overnight transformation, but this was exactly the type of project we were hoping for. We were now working for a startup preparing to raise capital to fuel their international expansion – the company’s future now hinged on this critical need for capital funding, and our work over the coming weeks would help to define the organization moving forward.

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We anticipated a work/travel experience that involved a healthy mix of work and play, allowing us to learn about the business culture in a new country, forge new relationships, and provide some time for side travel and exploration. Upon arrival, the presumed work:play ratio of our IBD project shifted in order to meet the changing needs of our client, and, truly, it could not have been more exciting.

Fueled by the office’s frenetic energy as they prepared for this pending milestone in the company’s near future, the enthusiasm amongst team members was palpable, as we were now able to assume a much more significant role working alongside our client to shape the future of the organization. Our diverse backgrounds (both academically and professionally) and our career interests in entrepreneurship/VC enabled us to serve as trusted advisors, assuming a primary role in developing the company’s strategy for funding and its pitch deck for investors.

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Final Product

Following three weeks of late nights, too much coffee, sweltering 120 degree heat, and some impassioned brainstorming and collaborative work sessions in the office’s sole meeting room, we converged to prepare a final pitch deck for our client. We conducted more than 20 interviews with industry experts, potential clients, and important influencers for this new market from all over the world to develop a clear vision of the risks and opportunities. We poured over financial statements, created sensitivity analyses for pricing, and cemented the companies’ value proposition for both future clients and investors. Ultimately, we even worked alongside a graphic designer to design and polish the final pitch deck to be used in upcoming VC pitches – if we were to offer lasting value, we needed to treat this as if were our own company and deliver the best possible product.

Our final presentation was structured as a formal VC pitch session. The client’s extremely positive response validated our hard work and confirmed that our contribution to the organization had been significant. We left our client with a deck that will aid and support them as they (successfully) pursue venture funding; confident that the presentation fully communicates the strengths of the organization, its remarkable team members, and their future promise as they enter uncharted territories and seek to transform a global industry.

We came to Haas to learn how to effectively lead people and organizations, to take bold risks, and to change the future of various industries through innovation. IBD provided an opportunity to partner with an exceptional group of visionary entrepreneurs in an emerging market, and it demonstrated the significant value of our MBA program. We came to Haas to learn, grow, and develop as both individuals and future leaders and to forge significant, life-long relationships with our peers and a network of global leaders – our IBD project confirmed the values of the Haas program and all its future promise for each and every member of our team.

Spring Break Treks: Camels, Monks, and Business Leaders

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Nearly 200 Berkeley MBA students criss-crossed the globe over spring break in the pursuit of camel riding, finding spirituality, meeting key business leaders, and building even stronger bonds with some of their new closest friends. Spring break trekkers traveled to Israel, Japan, Cuba, and Morocco and brought back with them a wealth of new experiences. Here are some of their stories:

Israel

The five tour leaders who guided 55 travelers through Israel wanted their guests — 47 of whom had never been there before — to experience of the “reality” of the country, based on personal experience and not on the perception of the small Jewish state they get from the news. Romi and Noa Elan, Adi Rubinovich, Yaron Leyvand, and Nadav Shem-Tov, all MBA 14 — believe they accomplished just that.

On several occasions, the leaders shared personal stories, such as how relatives died while fighting in the military, or introduced their relatives to their travel mates in person. In Tel Aviv, for example, some tour leader family members manned the stations of a scavenger hunt.

The tour group visited religious sites of both Christians and Jews, walked along the Syrian border, floated in the Dead Sea, and woke up early to climb Masada.

For Elan, who grew up in Israel, seeing the country through someone else’s eyes was illuminating. While climbing Masada, one guest commented, “This is the coolest thing ever.”

“Just hearing that about these things that I had taken for granted was amazing,” Elan says.

The tour group also visited Yad Vashem, Israel’s Holocaust Museum, which Elan thought showed the students “the context for the state of Israel and why some policies may seem so strict.” The group also spoke with Jerusalem Mayor Nir Barkat, a former businessman who got his start by co-founding a high-tech antivirus software company. “He laid out governing in business terms,” Elan says, “and how he intends to solve the issues of Jerusalem.”

Japan

Fifty-six Haas students traveled to Japan during spring break and toured the cities of Hiroshima, Kyoto, Atami, and Tokyo.

Highlights included waking early to listen to the holy sutras, living as monks do at the Buddhist temple in Mount Koya, and dining on vegetarian delicacies.

Ryo Itoh, MBA 15, helped lead the tour, which he described as a mixture of “culture, fun, andbusiness.” The group also visited a Toyota plant and Softbank, one of the largest telecom companies, and the atomic bomb museum in Hiroshima.

While everyone was really “cooperative,” getting 50-plus people on a bullet train in a one-minute window was a logistical challenge, Itoh says. So were some food allergies, which the group remedied by writing up cards with food instructions in Japanese to bring to restaurants.

In Tokyo, some students enjoyed a one-night homestay in which they were picked up by a Japanese host family and enjoyed an evening with a local family.

The trip concluded with a final dinner of more than 70 people, including Haas alumni in Japan and recent admits for the class of 2016.

Cuba

Eleven Haasies traveled to Cuba for the spring break, where they took in a lively salsa show in the colonial city of Trinidad, and half the group woke up early to trek to a secluded waterfall.

Brad Malt, Paul Cole, Matt Richards and Billy Blaustein, all MBA 15, even jumped off a 40-foot cliff into a swimming hole at the base of the waterfall. “It was really cool and definitely a highlight of the trip,” Malt says.

The students received one credit for an independent study called “Innovation in a Closed Economy,” looking at how the recent changes and loosening of restrictions are affecting Cubans. The MBA students had lunch with a Cuban veteran who worked closely with Che Guevara and Fidel Castro and shared his perspective on the embargo, recent changes, and how they are affecting Cubans.

The group also came to Cuba with two dozen baseballs and hats donated by the Cal baseball team to hand out to Cubans, who were grateful for the American gifts. On the students’ drive to the Bay of Pigs, Malt said they spotted a baseball field in town and pulled over for an impromptu pickup game. They didn’t have a bat, so a local Cuban lent them a partially broken wooden one. As they played, more and more townspeople came either to watch or to join the game.

“It was one of the more memorable experiences of my life,” Malt says.

Morocco

The Morocco trip started off small, with five people asking to tag along as Moulay Driss Belkebir Mrani, MBA 15, planned a visit to his homeland. In the end, Mrani ended up leading 66 people through Essaouria, Marrakech, Ouarzazate and the desert of Zagora.

The group enjoyed sightseeing, shopping, and camel riding, but there was also a purposeful business angle weaved into the trip. Mrani took the group to meet the CEO of the OCP Group, otherwise known as Office Cherifien des Phosphates, the world’s largest phosphates exporters and Morocco’s largest corporation. . “We had lunch and discussed the future of the fertilizers industry and the impact on farming in the world,” Mrani says.

The group also visited a mining complex and the site of a new university and met with a woman’s cooperative, where they learned about oil production.

One of the most memorable parts of the trek was the road trip to the desert in Zagora. There, under the stars, the group listened to tribal songs, lit a huge camp fire, and smoked in the “hookah corner.”

For Mrani, one of the greatest aspects of the trek was showing his country to his peers and re-discovering it himself.

“When you spend a week day and night with people, you get to know them better,” he said. “And to be in the desert in the middle of nowhere, in tents with food and music … Well, it was surreal and pretty amazing.”