MENA's startup trajectory: An exclusive interview with 500 Startups COO, Courtney Powell

500 Startups, the global early-stage venture capital firm, recently announced that the firm is bringing on board new members to its 500 MENA team to develop new funds and initiatives. The move aims to amplify its ongoing commitment to support talented founders and promote innovation in one of the most dynamic ecosystems in the world.

Following the announcement, MAGNiTT caught up with Chief Operating Officer of 500 Startups, Courtney Powell to delve into how the changes will impact current portfolio companies and follow-on funding, if there will be an increase in cross-border collaborations, what the new funds will focus on, and much more. 

Check out the interview below to discover 500 Startups' future plans. 

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What do the changes to the fund mean for your current portfolio companies?

Adding Bedy Yang as a Managing Partner to the Falcons fund means that the portfolio will have even greater support from a seasoned global investor who puts founders first–always. Rina Onur, who is now an advisor to the Falcons fund, brings a myriad of experience as a top-performing investor and an entrepreneur with a phenomenal track record. The Falcons portfolio is maturing, and Bedy and Rina know what it takes to help founders get to the next level.

How will these changes impact follow-on funding?

We’re nearing the end of deployment for our Falcons I fund, but Bedy and team will drive follow on investment decisions arising from any remaining or recycled capital. Laila Hassan, who has been the primary point of contact for the Falcons portfolio as they begin exploring follow-on funding, will continue working closely with our portfolio. Additionally, 500 Startups is unique in that our investment model was built on our regional funds (such as the Falcons fund) sharing deals with our Global Fund which invests in late Seed, Series A, and even some Series B deals depending on the market.

500 Startups have typically invested across sectors at the early stage, will this continue to be the case? And what does it mean for startups who are looking to fundraise from you in the future?

If you are a founder raising a compelling Seed round in MENA, 500 should absolutely be your first port of call – we will continue to invest across sectors at the Seed stage in the best companies MENA has to offer. We love hearing from founders and are quick to share whether or not there is a fit in terms of timing, thesis, traction, etc. We have plans for new funds and programs in 2021, which we will announce later this year. 

You have nearly deployed the majority of the funds in Falcons I and will be announcing the launch of new funds/initiatives later on in the year, can you share what these new funds will look like and what they will focus on?

MENA is a very important market for us, and it is a region that I have personally really fallen in love with – the energy of the founders and the support for entrepreneurship is unmatched. Our new initiatives will reflect the rapid maturation we’ve seen over the past 2-3 years. What I can say is that we will continue to invest in Seed-stage deals across the region, but we will also likely add to our funds' mix and explore later stage opportunities. We’re very excited about our upcoming plans, which you’ll hear about soon.

With Rina Onur joining the team (Founding Partner of 500 Istanbul), how will this change the investment thesis? And will this allow for an increase in cross border pollination/collaborations?

The addition of Rina as an Advisor is a major advantage to our MENA operations. She has an incredible background both as an investor and an entrepreneur; Rina is the co-founder of a startup that was recently acquired for $1.8B by an American company. Rina is exactly the type of investor a founder wants in their corner.

In terms of cross border pollination, we bet on founders who think regionally and globally and don’t limit themselves to their home market. We already have a few Turkish founders in our Falcons portfolio, who consider MENA to be a major growth market. Consequently, we have many others who consider Turkey a significant expansion market. We are ready to support this cross-border growth and collaboration to help Falcons companies become regional champions.

Historically, 500 Falcons had a very hands-on approach with their portfolio companies including lots of events, meetups, and their annual retreat. Will this approach continue moving forwards?

One of the things that make 500 different is our very hands-on approach with founders, and MENA is no exception. The Falcons team has done a great job at fostering a founder community, and we will absolutely continue to do so. Sama Alshawi who runs Community and Events for 500 MENA has recently run a fantastic Webinar series in support of our founders navigating COVID-19, called Founders Crib. Sama will continue to run our MENA community efforts and we look forward to the day we can come together at the 500 MENA retreat again. The retreat in Jordan earlier this year was unforgettable! 

Does 500 still plan to run accelerators and their dojo program in the region?

The Misk500 program has invested in so many wonderful founders and yielded a real impact on the surrounding ecosystem. We had over 800 investors at the Misk500 Batch 3 demo day in May! We hope to see our accelerators expand throughout the region. Stay tuned!

The Digitainment Industry saw a number of sizable investments over the last 5 years, a total of $235M invested across 98 deals from 2015 to 2019. Discover more trends and insights in our 2019 Digitainment Venture Investment Report