Careem has managed to retain its local identity, while souq.com has dissolved into Amazon after being acquired and now rebranded as Amazon.ae, according to the founder of Urent, a peer-to-peer vehicle sharing platform.
E-commerce platform Souq.com was acquired by Amazon in 2017 for $580 million and Careem was acquired by ride-hailing firm Uber technologies as part of a $3.1 billion deal earlier this year.
“One of the conditions Careem put in place was that they maintain their identity, which I respect so much. When Amazon acquired Souq, Souq just dissolved and became Amazon. But here, you can see Careem doing bigger things in the future and maintaining their name and identity,” Omar Al Ashi told Arabian Business in a video interview.
“They are growing onwards but in the back end, Uber acquired Careem. That doesn’t defeat the purpose that they are a UAE born entity and they will continue to grow as a UAE born entity and maintain their identity”.
Mergers and acquisitions is a trend that was started in the region back in 2009 with Yahoo!’s acquisition of Jordanian company Maktoob.com. More recently, UAE-based online classifieds website Dubizzle was fully acquired by Naspers, a South Africa-based investor, through its subsidiary OLX Group, for $190 million, following its partial acquisition in 2013. The company was valued at $400 million.
The trend of global brands acquiring local start-ups just seems to be growing and speaks volumes of the growing strength and credibility of the UAE’s start-up ecosystem, according to the founder of Trukkin, a logistics and transportation startup.
“This shows the maturity of the market and that international companies and investors have started taking the region seriously, which encourages the whole ecosystem,” said Janardan Dalmia.
“With all the M&A happening, it shows that all the regulators, government and financial markets are supporting it”
But is this the final goal of every start-up in the region then? Dalmia doesn’t think so. “We believe in ourselves as a truly local company, trying to solve local problems. So we would like to be one of those companies that goes international rather than someone else coming here”For all the latest tech news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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