FB Pixel no scriptUber discontinues services, a myriad of new launches in media, and some hope from VCs | The Middle East Monthly Roundup | KrASIA

Uber discontinues services, a myriad of new launches in media, and some hope from VCs | The Middle East Monthly Roundup

Written by Qadisha Group, Digital Digest, Smarkk Published on   6 mins read

Facebook, China Mobile, MTN GlobalConnect, Orange, and Vodafone, announced the go-ahead to build a new subsea cable to serve Africa and the Middle East.

May has been a busy month in the Middle East. Each year, Ramadan leads to a surge in demand for consumer goods, content, and entertainment, which was even more prevalent this year, as the region experienced Ramadan under strict lockdowns. We have filtered through the news to bring you the most important developments from investments in startups, latest policy changes, growing sectors, and more.


Uber’s global restructuring and cost-cutting has impacted their MENA operations as well. Over 400 staff members were fired from their Egypt office and UberEats was discontinued in 8 markets including Egypt and Saudi Arabia. Uber announced that the halted UberEast services would be pushed to CareemNow, which it technically owns within these markets. Food delivery is a competitive space, Delivery Hero which owns Talabat and Carriage in the GCC began consolidating its operations in late 2019 to cut costs as global discussions around the viability of the model remain in the spotlight.

Every delivery service today has broadened its offering to include groceries and onboarded brick-and-mortar stores. So it’s no surprise that we see well-funded companies like Noon.com and Kitopi, the cloud kitchen, expand their services to include dedicated grocery delivery. Noon.com launched Daily, a mobile-only grocery delivery interface that promises next-day delivery for groceries. This became a clear need as demand on e-commerce platforms increased and strained the system, causing some delivery times to stretch to up to 10 days for groceries. Kitopi, a B2B brand, took this opportunity to launch its first B2C product ShopKitopi, a grocery-only delivery interface powered by chatfood, that utilizes Kitopi’s strategic delivery kitchens and inventory to provide 60-minute delivery of groceries.


With lockdowns across the globe, ride-hailing, ride-sharing, and other commuting services took a hit. Although Careem found that investing further into CareemBus was not worth it and shut down its operations, we still saw startups like Invygo, a Dubai-based car subscription service, and Telgani, a Saudi-based car rental marketplace, raise funding.

Sources are reporting that automotive sales slumped 75% across Europe in April and May 2020 due to the pandemic, and it is rumored that the numbers are similar in the Middle East. Seeing startups in transportation raise funding can be considered a promising move by investors.

Interestingly the slump in sales did not deter Lucid Motors, the US-based electric car maker, from launching their pre-ordering campaign in Saudi and the UAE this month. Lucid Motors is backed by Saudi’s Public Investment Fund (PIF) and the Lucid Air model is expected to deliver in late 2021.

We see the same confidence with SWVL, the Egypt-headquartered on-demand mass-transportation app, as it appears they raised USD 7 million from Vostok Ventures (as per their Q1 filing) as part of a bigger round. The round, which may have slowed down due to the pandemic, is valued at a total of USD 20 million. SWVL, this month, also received regulatory approval from the National Transport and Safety Authority (NTSA) in Kenya to kick off operations.


The media landscape is beaming with launches this month: Spotify Premium Family is now available in the UAE, Weyyak, Zee-Entertainment’s SVOD platform, launches linear “Live TV” channels, and Abu Dhabi Media Office (ADMO) and VICE Media partner to launch a news channel “Lamma”.

With more consumers adapting to spending time on on-demand and digital content, we expect this space to get very crowded, competitive, and in need of more distinct offerings very soon. This explains why Starzplay has been partnering with telecom operators to expand their footprint in the region. Their latest partnership with Zain Telecom gives them further access to both the Saudi and Iraqi markets—as they already have partnerships with other telecoms there. Also, MBC Group partners with China’s TCL Consumer Electronics to integrate MBC’s SVOD platform Shahid onto all TCL Android TVs in MENA.

To analyze the impact of the lockdown on consumers in the region, Choueiri Group released a survey highlighting reported behavioral changes by consumers in the UAE and Saudi during Ramadan and the expected behavior that will continue post-season.

Financial Technology

Financial technology continues to take the spotlight as an enabler for digital transformation and a vital pillar of the new normal. This month over USD 6.5 million was invested in startups based in MENA: Shahry (Egypt), Ziina (UAE), Tamara (Saudi), and Yallacompare (UAE).

Meanwhile, Tribal Credit, a San Francisco-based fintech solution for SMEs in MENA and emerging markets, reported that its seed round grew from USD 5.5 million in December to USD 9.1 million to date. Tribal Credit’s investors are mostly MENA-based like BECO Capital, Endure, and others. This trend continues as Countingup, a UK based fintech that offers banking and accounting services to startups, freelancers, raised a USD 5 million bridge-round with investors that include Egypt’s Commercial International Bank (CIB)’s corporate VC CVentures.

Egypt is aggressively trying to improve its digital financial infrastructure, representing one of the biggest Middle Eastern populations, yet with the lowest rate in credit card penetration and financial inclusion. A national effort is needed to transform the economy into one that can deal with the rapidly changing world. We see this in Egypt’s Central Bank (CBE) announcement that they’ll be distributing 100,000 electronic POS devices to retail outlets across the country to aid the move to digital payments, with priority for vital outlets like supermarkets, pharmacies, and gas stations. At the same time, Vodafone Egypt sealed a partnership with TPay Mobile to launch a mobile payment solution.

There have also been a few notable reports published this month on the state of financial technology in the region: One by Village Capital, in collaboration with Badia Capital and MetLife Foundation on “The State of Financial Health Startups in the Middle East & North Africa”, and another from the Arab Monetary Fund on “Financial Inclusion in the technology-led globalization age”.

Policy & Economy

An increased sense of urgency for investment in technology and infrastructure is felt, especially in the GCC. Saudi’s Public Investment Fund (PIF) disclosed recent stock purchases in major American companies worth USD 713 million in Boeing, USD 522 million in Citigroup, USD 522 million in Facebook, USD 495.8 million in Disney, USD 487.6 million in Bank of America, and more in Marriott, Berkshire Hathaway, and BP, according to a US Securities and Exchange Commission (SEC) filing. Also, Abu Dhabi Developmental Holding Company (ADQ) launched a new USD 300 million (AED 1.1 billion) venture fund: Alpha Wave Incubation Fund (AWI). The fund will focus on “early-stage businesses in India and Southeast Asia” and will be managed by New York-based Falcon Edge Capital.

Meanwhile Facebook, China Mobile International, MTN GlobalConnect, Orange, and Vodafone, announced the go-ahead to build a new subsea cable to serve the African continent and Middle East region under the name 2Africa.

Abu Dhabi’s Executive Council also issued a law establishing an “Advanced Technology Research Council (ATRC)” to lead the way in developing policies that nurture R&D and develop academic grants.

On the Saudi side, a notable report worth delving into is Invest Saudi’s “Investment Highlights Spring 2020” report that summarizes the impact of COVID-19 on the kingdom, the economic changes, and the stimulus timeline and breadth by different entities.

How are startups faring in the pandemic?

This question has been circulating and speculated over during the past 3 months, while multiple entities took the initiative to survey the startups and give us some data on the situation at hand:

Wamda and ArabNet released a broad survey on “The Impact of the COVID-19 Outbreak on Technology Startups in MENA”, while Riyadh Taqnia Fund (RTF) conducted a survey on founders and VCs in Saudi specifically to measure the impact and perceived prospects of the pandemic on their business. Bensirri, the Kuwait-based public relations company, surveyed 500 tech startups and SMEs for the “COVID-19 Kuwait Business Impact Survey”.

The conclusion is a little dire, most startups and SMEs have less the 6 months of runway before we start seeing mass closures.

However, there is also a bright side. Magnitt took a different approach and surveyed VCs on their “dry-powder” (available funds) and the ticket sizes and total investment for deployment. They are comfortable to invest through the rest of 2020. Founders that can show resilience, agility, and sustainability have access to funding and may see this as their golden opportunity.

Photo credit: Euan Cameron via Unsplash


Auto loading next article...