Zest Your Equity | 01-May-2024

How equity dilution impacts investors, funding landscape for AI startups, and more.

Author

Ghalia from Zest
May 01, 2024

This week’s agenda 📜

  • Our blog ✍️

  • Startup fundraising 💰

  • What we’re reading 📖

  • Zest updates 🚨

Let’s dive in 👇

Our blog ✍️

Equity dilution—also known as “share dilution” or “fundraising dilution”—occurs when existing shareholders’ ownership percentage is reduced as a result of the company issuing new securities to investors. 

Dilution starts from the first moment an entrepreneur raises outside capital either in the form of a SAFE, convertible note, or equity.

This impacts many private market investors and is common among high-growth companies.

Want to learn how dilution can impact your portfolio and what you can do to mitigate the impact? Read our recent blog that explains everything you need to know about equity dilution.

Startup Fundraising

  • 🇦🇪 UAE-based e-commerce startup WEE has concluded a pre-Series A round at $12 million, after raising a $10 million investment, comprising equity and credit facilities, from SIG Investment.

  • 🇪🇬 Egypt-based fintech Bokra has closed a $4.6 million pre-Seed round led by DisrupTech Ventures, and SS Capital, among other investors.

  • 🇦🇪 UAE-based logistics startup Shorages has raised a $1 million pre-Series A funding round, led by Joa Capital, as part of their S3 Ventures Fund

  • 🇪🇬 Egypt-based HRTech bluworks has raised a $1 million pre-Seed investment round, led by Khawarizmi Ventures and joined by Camel Ventures, Acasia Ventures, and other angel investors.

  • 🇯🇴 Jordan-based healthtech Arab Therapy has secured $1 million in seed funding, led by Flat6Labs, Vision Health Pioneers and supported by a group of international angel investors.

What We’re Reading 📖

Investors Are Showering AI Startups With Cash. One Problem: They Don’t Have Much of a Business

Some startups are raising hundreds of millions of dollars before having a product or revenue.

The legal clause more VCs are adding when funding startups

“I wouldn't be surprised if this is starting to emerge as a thing that investors will ask for,” says Latham & Watkins partner Shing Lo.

CBUAE’s foreign assets increase Dhs203b

The total foreign assets of the Central Bank of the UAE (CBUAE) surpassed the Dhs700 billion mark at the end of February 2024, for the first time in its history.

Saudi Arabia to host 28th World Investment Conference from November 25 to 27

The Saudi Investment Promotion Authority recently signed an agreement to host the 28th edition of the World Investment Conference with the World Association of Investment Performance Agencies (WAIPA).

Fintech Fundid was shut down over interest rates and a strained cap table

To keep going, Fundid “needed to put up a lot more collateral because of the changing environment,” Stefanie Sample said.

Investcorp Sets Up $1 Billion Mideast Fund Backed by China’s CIC

The Middle East’s biggest alternative asset manager is setting up a $1 billion investment vehicle backed by Beijing’s sovereign wealth fund to invest in companies across the Persian Gulf and China.

Zest Updates

Last week, we had the pleasure of representing Zest Equity at the Angel Investing Unlocked Summit in Riyadh hosted by 500 Global and Sanabil Investments.

Our Co-founder, Zuhair, spoke on the topic of syndicates and SPVs within our ever-growing private market ecosystem in the MENA region.

Want to learn more? Schedule a time with our team below!

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