Zest Your Equity | 31-Jan-2024

Industry vet expects secondaries to hit record volume in 2024, book recommendations for new VCs, investment trends in the MENA region, and more.

Author

Ghalia from Zest
January 31, 2024

Infrastructure to power your transactions

What’s New?

The New Non-Dilutive Capital: Introducing NICE, A Founder-Friendly Alternative to Traditional Venture Debt

NICE is a new type of security, offering an alternative to traditional equity and venture debt. Tabby, MENA’s latest unicorn recently raised capital using the NICE structure and STV - an $800M Saudi-based VC firm is here to explain what that means.

Introducing “NICE”: Non-Dilutive Investment in Callable Equity

1. No downside risk: NICE is based on callable equity, which gives founders the option but not the obligation to buy back this equity in installments over the maturity period – as such, it is a Shariah-compliant structure.

2. Variable repayments: The buybacks are revenue-linked, which means that our returns are tied to your future cash flows – we win if you perform well, while we both see lower returns in case performance is not as expected. Moreover, in case you do exceptionally well, we cap the returns that we see to further align interests.

3. No covenants: As an equity-based instrument, it does not come with any covenants, which further alleviates the burden on startups. You are free to invest the capital in the best way you see fit to grow your business, which provides a big boost to your maneuverability.

Who’s Raising? 💰

  • Middle East-based AI startup DXwand has closed a Series A funding round of $4 million, led by Shorooq Partners, Algebra Ventures, and existing investor Dubai Future District Fund.

  • Zeal, an Egypt-based fintech and customer loyalty app, has closed a $4 million funding round led by Raed Ventures and Cur8 Capital, along with strategic angel investors.

  • Egypt-based logistics startup Roboost, has closed a $3 million investment round, led by Silicon Badia, with contributions from RZM Investment, Flat6Labs, and Saudi Arabian angel investors.

  • UAE-based agritech Crysp Farms, has secured a $2.25 million pre-Series A round, led by Gate Capital with participation from other regional investors from the UAE and Saudi Arabia.

  • Qatar-based fintech KARTY, has raised a Seed funding round of $2 million from local investors.

  • Saudi Arabia-based edtech iStoria, has raised $1.3 million in a Seed round from Nama Ventures, Classera, Flat6Labs, BIM Ventures, and several other angel investors.

  • UAE-based proptech Silkhaus, has raised a multi-million-dollar pre-Series A financing from San Francisco-headquartered Partners for Growth (PFG).

M&A Activity 💼

  • DHL Global Forwarding completes acquisition of Danzas AEI Emirates. Source.

  • UAE’s Elite acquires LogX in multi-million dollar logistics deal. Source.

  • Dubai-based Amantra FM acquires firestop specialist AL MANQAB to expand service portfolio. Source.

What We’re Reading 📖

Jefferies dealmaker expects secondary market volume to hit record

Miller has high expectations due to the huge pile of dry powder held by secondary investors, an expanding buyer universe, the growing liquidity needs from LPs, and improvements in pricing levels.

Saudi Arabia launches plan to become biotech hub by 2040

Saudi Arabia has launched a national biotech strategy in an effort to become an international biotech hub within the next 16 years.

Ten considerations for private markets in 2024

Decision makers looking to get a head start on the private markets should consider ten things.

A Crowdsourced List of Books and Resources for New Venture Capitalists

A simple tweet yielded a really good set of resources for new venture capitalists. I present these all without comment or judgment - I think they are all worth reading.

What are the startup investment trends in Mena?

As the [MENA] ecosystem continues to evolve, understanding the current investment trends is crucial for entrepreneurs and investors seeking to navigate the landscape. 

Saudi Arabia offers tax incentives for companies moving regional HQs to Riyadh

Saudi Arabia said on Tuesday it will offer tax incentives for foreign companies that locate their regional headquarters in the Kingdom, including a 30-year exemption for corporate income tax.

Convertible Notes: Stepping Stones or Stumbling Blocks for Early-Stage Startups?

Why SAFEs Are Not That Safe

Zest Updates 🚨

We’ve refreshed our site to better assist our customers in understanding how to utilize the Zest platform.

Additionally, we’ll continue bringing you new resources and bringing you content every month in order to demystify private markets, explain key terms, and empower you to digitize your transaction processes.

Our blog 💬

The Emerging Manager Playbook For Navigating The Private Markets

Ever wondered how to get started in the private markets?

Even with the increase in private market investment activity in the MENA region, it can be challenging to learn how to source your first deals, build investor relationships, and raise capital, all while maintaining the administrative work of setting up investment vehicles.

In our most recent blog, we outline common options for emerging managers who are looking to start and scale their investment business in the private markets.

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Zest is digitizing private market transactions, building tools to streamline how entrepreneurs, funds and investors transact. Our platform is designed to save you time and reduce administrative costs, simplifying the end-to-end investment process.