What are investors in MENA advising their portfolio companies right now?

COVID-19 has made for uncertain times -- and this is felt by MENA’s founders. Despite this, we’ve learned at MAGNiTT that creativity and confidence in the face of chaos is in the MENA founders’ DNA. 

We asked the active investors on MAGNiTT for the advice they’re giving their portfolio companies right now. To support you, we have collected & compiled the advice given by 22 of MENA’s leading VCs, CVCs, angel groups, and accelerators. We hope this helps you navigate the current chaos.   

 

‘Reduce your cost dramatically (Marketing, daily expenses, operation, etc),recalculate your forecast, and measure your burn efficiently. When it is required to slow-down, spend time improving your product, assessing your business model, and re-evaluating your competitive edge. Be open with your investors and keep them updated with your situation and runway early on. Many businesses were created during difficult times, so do not panic and do not get demotivated.’

Ali Abussaud - Hala Ventures

 

‘Keep going hard at it. Get closer to your customers. Use the time to find opportunities to innovate. Keep teams “up” and excited. Keep cool.’
Ovais Naqvi - General Partner at RISE Capital 

 

‘In the short term, startups should conserve cash and manage for a 2 or 3 quarter recovery scenario.’

Basil Moftah - Global Ventures

 

‘Track changes in the consumer’s behaviour closely and adapt accordingly. In this turmoil, some will gain and some will lose. Either way, you should adapt quickly and wisely.’

Hussien Abdulgader - Raed Ventures

 

‘Take another look at your marketing and capital spend, your cash position and runway, and your sales and fundraising deals. But most importantly, take care of your employees and stay safe.’

Zaid Srour - iMENA

 

‘It’s an opportunity for startups to slow down and identify gaps in their business. this can also be time to be creative in providing value added services that answer to demands driven by the crisis. We hope that the startups maintain flexible policies that permit employees to work remotely and stay home to care for a sick family member if needed.’ 

Nawaf Alkoheji - Tenmou

 

‘Village Capital is deeply concerned about the health and safety of staff and entrepreneurs, and will be modifying business structures as needed in order to continue supporting early-stage entrepreneurs worldwide with investment and acceleration. In the face of economic uncertainty, we are more determined than ever to drive support for underserved entrepreneurs feeling the effects of this global crisis.’

Alicia Sornson - Village Capital 

 

‘We would like to extend two different pieces of advice for two different types of startups; 

1. For startups facilitating telecommuting and minimizing the need for physical interaction, we advise them to double down on growth and reach out to targeted customers by emphasizing their value proposition 

2. For startups that are threatened, on the other hand, and affected by the current global health issue, we advise them to reserve as much cash and settle with organic growth for the time being. Very important to communicate with your investors the revised plans.’

Salem Washeely - Derayah Ventures

 

‘Be smart with spending, save up if possible, and take advantage of social distancing in building and testing an efficient remote work setup.’ 

Leen Ashqar - Propeller Inc.

 

‘The key advice we give to our companies is to be critical of their current operations, yet confident in their overall abilities. The current situation will alter their immediate plans - expected revenues, expenses, productivity, burn etc. - which the company must anticipate and adjust to very quickly. But at the same time, we also encourage companies to be aggressive and fearless if they see opportunities, to double down on their wins. Don't be afraid to reach out for help - from your investors, advisors and fellow founders. Such scenarios are an opportunity to learn from each other.’ 

Himag Vaidya  - Shorooq Partners

 

‘My advice to the startups would be to recognize and embrace the environmental, social and governance (ESG) platform as their cultural DNA. Technology innovations with a social conscience will shape the future. A specific area which the UAE will shine is in EdTech and Construction tech, which are key Ghadan 21 focus areas.’

Ramesh Jagannathan - StartAD

 

‘Preserve cash, devise contingency plans and communicate frequently with key stakeholders - Employees, Customers, Board, Shareholders.’ 

Amjad Ahmad - Precinct Partners

 

‘We’re focusing on the silver-lining throughout this pandemic, we encourage businesses to re-examine their projections of the year, adapt their assumptions, and better manage their spending. And most importantly, use this time to better strategically plan your startup's future.’ 

Kholoud Almohammadi - Impact 46

 

‘The fundamentals of the MENA startup opportunity are still strong and continue to improve. However, the environment has become more complex and periodically is more challenging. Now more than ever, MENA entrepreneurs must be resilient and resourceful to adapt to this dynamic new landscape and shift priorities accordingly – balanced growth, lean operations, clear path to break even, working capital management and disciplined fund-raising. In this context, existing investors need to be more hands-on in supporting startups beyond capital and actively help them navigate the real on-the-ground challenges.’

Christos Mastoras - Iliad Partners

 

‘We would encourage not only our portfolio companies, but the overall ecosystem to be persistent and patient during these unprecedented times. Since most startups are technology-focused, this is also a great opportunity to further innovate and leverage technology to help companies maintain their productivity levels as much as possible. Also, the UAE Government has introduced timely and commendable stimulus initiatives focused on helping SMEs and the banking sector. Such companies should take full benefit of this Government support to overcome these challenging times. We are also seeing many startups step up to help the society in such times, which really reflects the strong level of empathy within the ecosystem.’

Fatima Alnaqbi - MBRIF

 

‘Manage burn rate, look for opportunities to support, and address current challenges. Keep supporting your customers and employees, and concentrate on business stability during these unusual times.’

Ahmad Tuffaha - Phoenician Funds

 

‘Revise forecasts for the coming quarter and keep an eye on your monthly burn’

Reem Al Mustafa - Faith Capital Holding

 

‘Startups generally need to be cautious about overspending and be lean as possible. Many sectors, especially ones that are linked to consumer discretionary spending have been impacted and will continue to feel the pressure of market conditions in light of recent announcements. It is important for startups not to burn money on marketing unless there is a clear and quantifiable impact of the marketing spend and metrics such as CAC are decreasing and CLV & recurring use of customers are increasing. Fundraising activities may take longer than planned and startups need to have a cushion to be able to push through these discussions that could prolong with investors.’

Hajar Alghofaili - Falak Business Hub

 

‘As a startup founder, you have always been both optimistic and realistic and this is the best time to employ this perspective. History tells us that the impact of the global epidemic will be felt until the end of the year, so keep your focus. Nonetheless, remain aware that funding rounds are expected to take longer to close. As such, burn rate and use of funds must be top of mind for you. Try to close any funding rounds you are finalizing soon and ensure you have a contingency plan to keep the lights on should these rounds take longer than expected. Finally and most importantly, stay healthy and ensure your teams are following best prevention practices.’

Hani Dabit - AB Accelerator 


You can apply for funding to all of these investors and many more on MAGNiTT HERE