Zest Your Equity | 29-May-2025

This week’s agenda 📜

• Terms and concepts (AI edition) ✍️

• Who’s raising? 💰

• M&A activity 🤝

• What we’re reading 📖

Let’s dive in 👇

Terms and concepts (AI edition!) ✍️

Usage-based pricing: A revenue model where customers are charged based on how much they use the AI service, typically measured in API calls, token counts, or compute time. Common in Model-as-a-Service businesses, this model aligns pricing with customer value but can create margin volatility at scale.

Fine-tuning: The process of adapting a pre-trained foundation model to a specific use case or domain by training it further on a specialized dataset. Fine-tuning enables AI products to deliver more accurate, domain-specific results, often forming the basis for vertical SaaS or proprietary model IP.

Breaking down the AI value chain:

The AI value chain represents the layered ecosystem through which artificial intelligence products are developed, deployed, and monetized. For investors, understanding where a startup sits in this chain is critical for evaluating defensibility, capital intensity, and scalability.

1. Data Layer

Every AI system starts with data. This includes data collection, labeling, cleaning, and curation. Companies in this layer provide synthetic data, annotation tools, or proprietary datasets, often critical for model accuracy in niche domains (e.g., healthcare, legal, finance).

2. Model Layer

This is where foundation models and training infrastructure reside. Key players here invest heavily in compute and data to train large models. It’s capital-intensive but can generate significant IP and downstream leverage through licensing or APIs.

3. Infrastructure Layer

Includes hardware and cloud providers, and tools for orchestration, monitoring, and deployment. This layer is essential for both training and inference, and often forms the backbone of usage-based revenue models.

4. Application Layer

This is where AI becomes productized (vertical SaaS tools, copilots, autonomous agents, etc). Startups here are closest to end users and often rely on APIs from upstream providers. Their edge lies in UX, domain expertise, fine-tuning, and distribution.

5. Integration & Distribution

The final leg is integrating AI into workflows via APIs, browser extensions, Slack plugins, or full-stack SaaS. Strong distribution and customer intimacy here often drive enduring value more than the model itself.

For investors, each layer has different risk/reward dynamics. Infrastructure and models are capital-intensive with moat potential; applications are faster to market but compete on UX and distribution.

Who’s raising? 💰

• 🇸🇦 Saudi Arabia-based contech WakeCap has secured $28 million in new funding at the Saudi-US Investment Forum to expand its services and technologies for improving construction site safety and productivity.

• 🇦🇪 UAE-based fintech Qashio has raised $19.8 million in a mix of equity and non-equity funding, led by existing investor Rocketship VC, with participation from MoreThan Capital, regional banks, and family offices.

• 🇪🇬 Thndr, the Cairo-based investment platform, announced a $15.7 million funding round led by Prosus, with support from Y Combinator, BECO Capital, Endeavor Catalyst, JIMCO, Raba, and Onsi Sawiris, bringing total capital raised to $37.76 million.

• 🇪🇬 Cairo-based used-car platform Sylndr has raised $15.7 million in a Series A equity round, led by DPI Venture Capital via the Nclude Fund, with participation from Algebra Ventures, Nuwa Capital, Raed Ventures, Uncovered Fund, Beltone Venture Capital, and Camel Ventures.

• 🇦🇪 UAE-based tech startup Tarjama has closed a $15 million a Series A funding round, led by Global Ventures, with participation from Wamda Capital, TA Ventures, Phaze Capital, Golden Gate Ventures, and Endeavor Catalyst.

• 🇸🇦 Saudi Arabia-based immersive media platform VUZ has secured $12 million in a pre-Series C funding round, with the International Finance Corporation (IFC), a member of the World Bank Group, joining as a strategic investor. The round also saw participation from Al Jazira Capital, Crosswork VC Success Fund, existing investors, and several prominent Saudi family offices, bringing VUZ’s total capital raised to over $35 million.

• 🇸🇦 Saudi Arabia-based fintech infrastructure platform Stitch has raised a $10 million seed round from investors including Arbor Ventures, COTU Ventures, Raed Ventures, and Saudi Venture Capital (SVC), with participation from regional family offices and other angel investors.

• 🇰🇼 Kuwait-based q-commerce startup Circle has raised $6 million in Series A funding from unnamed investors, marking a major step toward its regional expansion plans.

• 🇸🇦 Saudi Arabia-based spacetech SARsatX has raised $2.6 million in a Seed round, led by TONOMUS, with participation from Wa’ed Ventures (Aramco), Access Bridge Ventures, and KAUST Innovation Ventures.

M&A activity

• Tech Universal Ventures (TUV), a UAE-based investment holding firm, has acquired two high-growth technology companies—FixSquad (UAE) and ELVA11 (Sweden)—as part of its strategic push to scale intelligent services and expand its footprint across the Gulf and global markets. Source.

• EFG Finance, a subsidiary of EFG Holding, has approved the acquisition of its B2B e-commerce platform Fatura by MaxAB-Wasoko, a regional supply chain and fintech super app. Source.

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