SOURCE: AMEinfo - Startup fever: MENA exits reach $3 billion over five years
Off the back of recent activity with Amazon’s acquisition of Souq and Payfort, Alabbar’s acquisition of JadoPado and Namshi as well as Delivery Hero’s acquisition of Carriage, a new report by MAGNiTT looks to review and dispel a few myths around exits in the MENA region.
MAGNiTT has released its research on the exits that have taken place over the last five years. There have been 60 exits of startups in the MENA region, valued over $3 billion.
2015 saw a peak in recent activity with 16 startup exits but 2017 is shaping up with a strong start to the year with eight exits year in the first six months.
Who are they?
60 exits in the region are spread across MENA:
Philip Bahoshy, Founder of MAGNiTT says: “It is interesting to see consolidation predominantly in the e-commerce, logistics and food & beverage space across the region. All of which are startups that are consumer facing that solve a logistical problem of delivery. These startups have been acquired by larger organisations to further their consumer reach.”
Landmark deals such as the acquisition of Souq.com by Amazon, Jado Pado by Alabbar Enterprises and Yemeksepeti and Carriage by Delivery Hero are examples of this.
Bahoshy noted: “The time to exit of those startups that successfully sold their companies is in line with international benchmarks at seven years from founding to acquisition.”
The truth about VCs
While only 38 per cent of the deals have been disclosed, there are five key insights that come from the research:
Bahoshy added: “We are beginning to see VCs in the region make returns on their investments. Given many VCs in the region are still relatively young and with an average of seven years to exit of successful startups, we anticipate to see more exits come to fruition in the coming years as their portfolio companies mature.”
UAE tops MENA startup exits
‘MENA has had no exits’ is often a criticism heard around the corridors of many entrepreneurship establishments. Bahoshy says that this is a myth.
Here’s a look at five interesting themes emerging from the top ten disclosed startups:
The data provides positive news to MENA entrepreneurs and investors alike that there is light at the end of the tunnel. With seven years on average to exit many investments are likely to come to fruition in the coming years while the MENA region continues grow and develop awaiting its first Unicorn exit or startup IPO.
SOURCE: AMEinfo - Startup fever: MENA exits reach $3 billion over five years