FasterCapital, the Dubai-based online incubator and accelerator, has signed three regional start-ups to its new fundraising program, the top executive of the firm said.
FasterCapital will help the start-ups to raise funds through its newly launched vertical Raise Capital and will invest in nascent companies in the program through services and sweat equity.
‘Our Raise Capital program has just been joined by some very interesting start-ups in the Middle East. We are definitely seeing [interest from] more and more innovative and dedicated entrepreneurs from the region,” Hesham Zreik, chief executive officer of FasterCapital, told Arabian Business in an exclusive interview.
“We are looking forward to [partnering with] more [start-ups] soon,” Zreik said.
Saudi Arabia-based tech venture Favyo and UAE ventures Yalla Basket and Munch Text have signed up for the new program, where they hope to secure $1-3.5 million in funding.
Favyo, a social platform offering digital boxes to share one’s favourite pictures, books, food, fashion, products, places, music, movies and memorable moments, is looking to raise $3.5 million, while the UAE-based Yalla Basket, an online grocery delivery service start-up, is targeting $1 million.
The UAE start-up Munch Text, a free-to-subscribe service that sends subscribers information on discount deals for restaurants around the UAE, is looking to raise under $1 million.
On the mode of fundraising, Zreik said FasterCapital can tap into its large network of ecosystem partners – incubators, accelerators, crowdfunding platforms, venture capitals and a large network of angel investors – to raise capital for its partner start-ups in Raise Capital.
“We match businesses in our Raise Capital program with these funding sources. We [FasterCapital] also invest in start-ups directly,” said Zreik, a Forbes top 50 angel investor, venture builder and a software architect.
Hesham Zreik, chief executive officer of FasterCapital
Zreik, however, said FasterCapital’s investments are made by way of the services and expertise it offers to start-ups in exchange for sweat equity. FasterCapital will also provide start-ups with access to software and program development as well as help guide business development.
Zreik said start-ups signing up with Raise Capital for fundraising belong to various sectors and are at different stages of development.
“We assess the costs first with the [start-up] founders based on their goals and the services they are interested in. We build a plan that we and the founders agree on and then we move forward,” the FasterCapital chief executive said.
As for the increasing number of start-ups seeking seed and growth funding in the Middle East, Zreik said the rising entrepreneurship will fill many gaps in the Middle East and North Africa market and will also encourage innovation and increase job opportunities.
“These are all big and important goals,” said Zreik, who has co-founded more than 40 start-ups and invested in over 100 start-ups to date.
Start-ups signing on with fundraising initiatives such as Raise Capital is seen by experts as a signal of the rapid rise of the start-up ecosystem in the region, fuelling demand for capital.
Sandeep Ganediwalla, Dubai-based managing partner of RedSeer Consulting
“We saw a fast track of consumer behaviour towards digital in the region during the pandemic. Now, it is clear that a lot of this shift will be permanent. Hence, we are seeing more investment activity in the region,” Sandeep Ganediwalla, Dubai-based managing partner of RedSeer Consulting, a global consulting firm specialising in online-based services, told Arabian Business.
“Talent in the region has now matured as we have seen the emergence of few large companies such as Careeem, Souq and Noon. Finally, investment availability is also improving as locally more funds have raised money and international funds are increasingly looking at this market,” Ganediwalla said.
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