Zain Ventures invests in Pipe.com and swvl.com to accelerate their growth across Middle East
Zain Group, a leading telecom innovator in seven markets across the Middle East and Africa announces the creation of Zain Ventures and the closing of investments and signing a Memorandum of Understanding (MoU) with both Pipe and Swvl to support their growth across Zain's regional footprint and beyond.
Zain Ventures was recently established to complement the existing investment portfolio of Zain Group and open the door to future investment opportunities in the venture capital, FinTech and Tech World, focusing on digital innovations in the fast-growing electronic services and startup ecosystem.
Pipe is a fast-growing US based FinTech recognized as the world's first trading platform for recurring revenues with its recent fund-raising valuing the entity at US$2 billion in just under a year since its public launch in June 2020, making it one of the fastest fintech to reach this valuation in history.
Swvl is transforming the $1 trillion global mass transit market. The Company's proprietary mobility solutions, powered by cutting-edge technology, are helping to solve mass transit supply and demand challenges in complex, emerging markets – empowering massively underserved communities with transportation solutions that are reliable, convenient, safe, and affordable. It currently operates across 10 cities in the UAE, Saudi Arabia, Jordan, Egypt, Kenya and Pakistan.
Swvl is set to go public through a formidable merger with the women-only led special purpose acquisition company (SPAC), Queen's Gambit Growth Capital, in collaboration with Agility, Luxor Capital Growth and Zain, valuing the startup at US$1.5 billion marking it as the first US$1 billion plus unicorn from the Middle East to list on Nasdaq and the only tech-enabled mass transit solutions company to list on any stock exchange. The transaction is expected to generate gross proceeds of up to US$445 million, which will be used to fund and accelerate Swvl's growth plan with a goal of driving $1 billion of annual gross revenue and expanding to 20 countries by 2025.
Bader Al Kharafi, Zain Vice Chairman and Group CEO commented, "The establishment of Zain Ventures is another step in Zain Group's '4Sight' strategy and progression to become a full-fledged digital services company. We have already enjoyed tremendous success in the investments we have made in venture capital entities and startups that show promising potential for boosting our revenues in new and developing verticals, and formalizing these investments under a single entity at this time will create shareholder value." "We are extremely excited and confident that Zain Ventures' first investments in fast-growing and world-leading entities in their respective industries, Pipe and Swvl will be value accretive to all parties as we accelerate their growth across the region and beyond. We are keen on participating in and encouraging the global entrepreneurial startup ecosystem." In regard to Swvl, Al Kharafi noted, "Zain grasped the opportunity to invest in Swvl for reasons that are also core to our Sustainability, Diversity and Inclusion corporate strategy: 1. Supporting national transport infrastructure and optimizing mobility; 2. Serving the under privileged; 3. Sustainability and environmentally friendly; 4. Women empowerment and safety; 5. Unlimited synergies with Zain's footprint across the region. The Zain team looks forward to playing its strategic role and being part of Swvl's trajectory growth and global success story."
Commenting on the two entities, Malek Hammoud, Chief Investment and Digital Transformation Officer added, "Pipe is a start-up that is re-writing the rule book on fintech development, and in which many other prominent and shrewd venture capitalists and investment companies are supporting strongly, as shown by the latest round of funding we all participated in. We believe Pipe offers an incredible opportunity for capital appreciation and revenue growth and we look forward to participating in its continuing expansion as more clients are added to the platform." Regarding Swvl, Hammoud added, "The enormous and relatively untapped entrepreneurial talents of the region are being showcased to the startup ecosystem global community through this transaction that will see Swvl as the first $1bn+ unicorn from the Middle East to list on Nasdaq." More on PIPEPipe was founded in September 2019 with the mission of giving Software as a Service (SaaS) companies a way to receive their revenue upfront, by pairing them with investors on a marketplace that pays a discounted rate for the annual value of those contracts. The company has achieved a US$2 billion valuation in just under a year since its public launch in June 2020, making it one of the fastest fintech to reach this valuation in history.
The goal of the platform is to offer companies with recurring revenue streams access to capital, so they are not required to dilute their ownership by accepting external capital or forced to take out loans. Over 4,000 companies have signed up on the Pipe trading platform since its public launch in June 2020. The company's tradable annual recurring revenue (ARR) on its platform is in excess of US$1 billion and trending toward US$2 billion, with tens of millions of dollars currently being traded every month.
More on SWVLIn just four years, Swvl has become the industry leader in mass-transit across 10 cities in Egypt, Kenya, Pakistan, the UAE, Saudi Arabia and Jordan with plans to expand to 20 countries by 2025. Swvl's revenues and markets have grown rapidly, with more than 1.4 million riders booking more than 46 million rides to date with thousands of drivers on Swvl's platform.
Featuring diversified transit offerings that, in just a few short years, Swvl services have evolved from daily commuting to inter-city retail travel, to Software as a Service ("Saas") and Transport as a Service ("TaaS") offerings for businesses, schools, universities and other critical service organizations.
Swvl's established user base has a track record of loyalty, with more than 20% of inter-city riders opting to use multiple platform offerings. Further, the Company empowers drivers in emerging markets – who frequently experience income uncertainty from existing mass transit operations – to earn approximately double that of other ride-sharing platforms. With its SaaS and TaaS offerings, Swvl has already enabled more than 100 organizations around the world to reduce costs through dynamic routing, network planning, demand estimation, fleet optimization, and other leading transit services.
More on Zain VenturesInvesting in the world of venture capital provides Zain with a vast range of opportunities to diversify and expand its reach in the surrounding ecosystem. Over the years, Zain has expanded its relationship with regional and international venture capital funds such as MEVP, Wamda, and Colle Capital, supporting the respective portfolio companies whenever appropriate.
Zain has also continued its active engagement in direct strategic investments in a variety of promising startups from the region, offering them support on multiple fronts including a wide geographical reach and progressive customer base for expansion opportunities.
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