This Egyptian Startup Is Making Car Rides Smoother One Spare Part At A Time

Nzekwe Henry September 27

Imagine being held up on a cold, rainy night because your car blew up yet another gasket to make it the third time in as many weeks. Or think about having to pull over now and then on a routine trip to your country home because of a faulty fuel pump and worse still having to spend twelve hours on the road for a trip that should ordinarily take half that long. Now, the only way these scenarios can get any more frustrating than they already are is if it happens that you have already spent good time and money trying to fix those.

So what if you could actually get a reliable remedy for your car’s nagging shaft problem, or that lingering issue with its steering rod and ball joints, or better yet, get an upgrade on its entire gearbox and engine system? Well, don’t get excited yet because it gets even better. What if you could place orders for all those auto car parts online and have them delivered to you with assurances on quality? Better yet, what if car repairs and full automobile maintenance was available at the click of a button and not a fuss more? Think about that for a moment. Sounds good, doesn’t it?

Well, for starters, that is what Ahmed Omar and the rest of the 17-man team at Odiggo are looking to achieve – and it appears their efforts are starting to yield significant impact. Odiggo is an online platform for car parts, assisting customers in the areas of fixing and servicing their vehicles. Through Odiggo’s mobile app and web platforms, customers are able to browse through car categories and models and find quality spare parts that are designed for their vehicle which can help get it back on the road.

So, Odiggo is essentially an eCommerce platform for auto spare parts, amongst other things. The auto parts available on the platform can either be installed by the customers themselves or via its soon-to-be-launched car service center. Odiggo boasts a catalog which encompasses different kinds of genuine auto spare parts for a wide range of car types and models. The startup rakes in revenue in the form of commissions charged on products purchased via the platform.

The startup is also believed to be making significant strides in the development and launch of a newer product which is necessarily hardware that can sort of inspect cars, carry out preliminary diagnostics, as well as communicate faulty areas with the platform’s mobile app. The technical team at Odiggo who are the brains behind this novel technology are said to have test-ran this AI system on a number of vehicles, and after multiple iterations, the results are thought to be encouraging.

In a conversation with WeeTracker, Ahmed Omar who doubles as the startup’s Founder and CEO revealed that the idea behind Odiggo was triggered by the need to address problems many individuals encounter in the process of accessing quality spare parts for their vehicles. The CEO cited difficulties associated with finding the trusted and competent repair centers for motor vehicles, while also hinting at the uncertainties surrounding car replacement parts purchase, as some of the motivation for executing the idea.

“Many people resort to going to car dealership agencies for auto parts and this comes at significant costs owing to the fact that the spare parts on offer from these agencies are often available at very exorbitant prices because these dealerships are more suited to selling spare parts in bulk to retailers who themselves sell to the end-users at prices that are not exactly favorable.”

With a view to solving this problem, Ahmed sort to explore the market opportunity that was buried amidst the spare parts sales problem – and it would appear that the Egyptian entrepreneur may have stumbled upon a gold mine.

Egypt can be considered an upwardly-mobile country with a well-structured, though often traffic-laden, road network especially in Cairo, its capital city. And with ride-hailing platforms like Uber and Careem seeing a lot of patronages and gaining considerable ground in the North African nation, Odiggo can be thought to be primed for even better days.

According to Ahmed, a premium is placed on technology-driven and affordable car maintenance solutions due to the presence of these ride-hailing platforms who boast thousands of cars on Egyptian roads and complete hundreds of trips on a daily, as well as individuals and private car owners who are on the lookout for more efficient and cost-effective solutions in the area of maintaining and fixing their vehicles.

Before launching his very own startup, Ahmed told WeeTracker about his academic background in economics, as well as his stint abroad as a seller on such platforms Jumia, Amazon, eBay, and a number of others; a feat that can be considered to have piqued his interest and sharpened his skills in the eCommerce sector.

He also has fond memories of his time at Used Cars where he got to know about just how much money and time people spent getting car maintenance. According to him, it may have, in fact, been around this time that the eCommerce idea for auto spare parts hit him as he had found himself shipping auto parts to a friend of his on multiple occasions within the space of a few weeks.

“He used to go and buy the parts himself from car dealerships, only to have them returned because they did not match the model used by his car. Apparently, the sellers too were not fully grounded on the products they sold, so he got around to having me ship the parts to him which I didn’t really have trouble with. And that was when the idea hit me. At Oddigo, using such details as auto parts serial numbers and a number of other technologies that are already available, we are able to help customers with the correct, genuine quality auto parts for their cars, at prices that are reasonable and with delivery in good time.”

The Odiggo platform is designed around the usability and convenience of customers. It makes it quite easy for users to find the correct spare parts for their cars as it narrows down search options to car make, model, and year. Users can also browse through the categories of the cars and the different types of parts, then navigate through the sub-categories to find the replacement part itself.

According to the CEO, once the needed parts are added to cart, and the transaction is complete, Odiggo delivers the spare parts to users within Cairo in 24 hours. For users outside Cairo, delivery time is placed at two days while for international clients, it is between four to six days. The startup currently boasts over 300 vendors in Egypt, two in Bahrain, one in Turkey, and plans are believed to be afoot to launch another in Dubai this month.

The startup is also looking to do one better by going beyond the regular shopping and shipping aspects that characterize eCommerce models. The CEO told WeeTracker that it is set to launch a car maintenance service on its web and app platforms for both Android and iOS devices.

This is expected to furnish users with the option of easily getting troubleshooting and maintenance services for their cars, with a number of service centers set to be launched in strategic locations across Egypt and other countries in the coming months. Customized car maintenance services will also be incorporated into the offering to cater for the car maintenance and repair needs of individuals who are unable to get their cars to the service station.

Essentially, Odiggo has set itself up to become a one-stop shop for all car maintenance needs by affording its users the dual option of conveniently sourcing for high quality auto parts and having them shipped or leveraging its car maintenance services which will be made available in both nearby service centers, as well as choice locations upon customer request.

And it would appear Ahmed and the rest of the team at Odiggo are getting some things mostly right as the platform boasts up to 12,000 users and over 8,000 requests processed since becoming fully operational only nine months prior. “We have more than 120 business customers, and companies that are dealing with us,” the CEO told WeeTracker. And that may be just for starters.

The startup appears to have gained significant traction as Ahmed revealed that Valeo; a renowned manufacturer of car parts is one of the prominent brands who directly sell on Odiggo with over 4,000 items featured on the platform. “We currently have more than 22,000 products for sale on the platform for about 31 different car brands and models. Over than the last nine months, there have been more than 200,000 visitors on our website, as well as an average of 45,000 monthly visitors on the platform over the same period,” the CEO offered.

 

These numbers may have a lot to do with the underlying statistics relevant to the industry. According to Ahmed, findings from an MVP conducted by the Odiggo team resulted in the collection of data which gave off astonishing revelations and hinted ample opportunity in the industry.

“There are about 500,000 front brake pads replacements in Egypt every month. If each unit is sold at, say, an average of USD 10.00, that is about USD 5 Mn worth of brake pad sales monthly. And that is for just one spare part being replaced every month without taking into account the cost of fixing cars in the aftermath of crashes which takes up to USD 300 Mn annually in the MENA region alone,’ Ahmed revealed to WeeTracker.

He went further; “In Egypt alone, there is around USD 1.3 Bn worth of spare parts imports annually, and it is a similar story in other parts of Africa and the Middle East where imports of both new and used car parts reach up to USD 10 Bn every year. One of our biggest vendors in Egypt realizes an average of EGP 69 Mn in spare parts sales annually, and that is only one vendor with about 1,000 items when there are about 7,000 spare parts vendors in Egypt alone.” This, the CEO believes, is an indication of the huge market demand available for auto spare parts – one that Odiggo is keen to cash in on.

The startup is said to have been built from personal funds and it was also self-funded for the first three months of its existence, and that was after going to vendors for some of its initial products. This was followed by a token investment from what is believed to be a combination of friends, partners and former colleagues which roughly amounted to USD 7.5 K in exchange for some amount of equity in the company.

Ahmed also gave indications that talks are currently in an advanced stage with some of the biggest angel investors and VC firms in Egypt to close an investment round that will see it raise a further USD 250 K in funding around the first quarter of next year. This envisaged injection of capital is expected to fuel the startup’s plans to explore a number of African and MENA markets, as well as help amass increased revenue. According to him, Odiggo is looking to branch into Saudi Arabia, Dubai, Nigeria, Jordan, and Lebanon in the near future.

But the going was not always this good for the business. Even though getting started often poses one of the biggest challenges, staying in business is, in many ways, the factor which ultimately defines the success or failure of any startup. And staying in business is not exactly achievable if you are not selling. Having been bootstrapped all the way to its launch, the startup was initially hampered by difficulties in getting products from manufacturers on credit as it was a new business.

“At first, nobody knew our platform so it was hard to get them to give us the products on credit. We had to pay cash for all the products during those first few transactions in a bid to establish trust. We did not buy anything unless we first sold them on the platform. This we did by collecting an inventory of all the auto parts available from the manufacturers and vendors, which was a challenge in its own right and then putting them up on our platform. Upon receiving orders, we purchased the parts with our own money since we operate on a Cash-On-Delivery model and shipped them to the customers through courier services like DHL and Aramex at a reasonable profit. But then, we began to gain the trust of these spare parts manufacturers and vendors and the credits and better deals started coming in.”

Besides the financial constraints, there were also other challenges that threatened to derail the business during those early stages. Customers did not exactly jump at the idea at first because they were doubtful of the ability of a business designed on such a model to actually deliver the goods. So the startup had its work cut out for it in trying to address the skepticism and mistrust by delivering as promised, even at no profit at times.

There was also a logistics challenge initially as the startup was caught up in a dilemma where it had to choose between big international companies whose services were really expensive but reliable and the local ones who were not as expensive but whose deliveries took several days. Throw that in with the market challenge posed by the vendors whose terms were not exactly favorable in the beginning, and customers who didn’t buy the idea initially, and you get the idea that it was not always a rosy affair.

But in any case, it appears the startup has weathered the initial storm and such has been the traction gained by the business during its relatively short existence that vendors now have no qualms giving them thousands of products on credit as there is now confidence in the ability of the startup to turnover and make payments as agreed. And the numbers already mentioned in this piece tell the rest of the story.

In spite of the competition that exists in the form of platforms with similar models in Egypt, Ahmed remains confident in the ability of Odiggo to hold its own amongst its peers as he cited such details as the value it affords users, the after-sales service, the easy-to-navigate catalog which boasts a wide range of auto spare parts for different car types and models, the affordable prices, the functionality of the website which enhances user experience, the mobile application, the AI device for running vehicle diagnostics and communicating findings with the app, the car maintenance option, as well as the automation that drives the service, as being factors that give Odiggo the competitive edge. It is also interesting to note that a number of these competing brands have dashboards on the Odiggo platform through which they resell products within and outside Egypt by leveraging its services.

 

Having been recognized in StartupScene’s 25 Under 25; an elite class of some of fastest growing and most promising young entrepreneurs in the MENA region, and having seen the startup through EG Bank’s MINT Incubator, Ahmed is hopeful that Odiggo will continue on its current upward trajectory and grow to become one of the biggest eCommerce platforms for not only car but also truck and motorcycle spare parts, as well as vehicle maintenance.

Investment deals are expected to be closed in the coming months with prominent investors in the MENA region featuring in talks, and this should go some way towards helping the startup explore other promising markets and further develop its technological offerings.

Baring his thoughts to other budding and aspiring entrepreneurs around the world as a parting gift, the Odiggo Chief had this to say; “Start executing those ideas and vision that you think about every day but do not act upon out of the fear of failure. Those ideas may actually prove successful, and if you never try, you might never know.”

Africa-Focused Cryptocurrency SAFCOIN Launches Today

December 13

SAFCOIN, an exclusively Africa focused crypto-currency, officially launches today. 

Local crypto enthusiasts recently were able to be part of the SAFCOIN ICO (Initial Coin Offering) which ended on 31 October 2018, and now those who missed out on the ICO can get involved – as SAFCOIN is open for trade.  

“What an exciting year it has been for us,” says Neil Ferreira, Co-founder and CEO of founding company, FHM (PTY) Ltd.  “We are proud to be part of the blockchain and crypto revolution. We are excited to bring the SAFCOIN blockchain, mobile app and exchange to the people of South Africa.”

  

African Cryptocurrency

 

During the ICO there were some who highly doubted the launch of SAFCOIN as many have fallen prey to ICO scams– thus making it difficult for startups to enter the market and make a success of it. Despite some obstacles, the SAFCOIN team is thrilled to have proven to the public that they are here to stay and determined to make a positive difference in the lives of many.   

SAFCOIN aims to tap into the ways that crypto can positively impact Africa.  “We are not here to overthrow the existing financial system but rather tap into the numerous benefits of crypto for Africa by developing use case technology for every individual to benefit from the positives of crypto-currency. All while maintaining the highest levels of business ethics and standards” says Ferreira.

The launch of the SAFCOIN crypto, wallet and exchange lay the foundation for many innovative developments in the future with the rollout to Africa, e-commerce integration and other developments already well underway. 

Although crypto is currently unregulated in South Africa, SAFCOIN decided to self regulate the exchange by adopting KYC (Know your customer) protocol and FICA compliance to ensure friendly use. 

First, call centre opened in Garden Route

SAFCOIN opened its first South African call centre on the Garden Route in the Western Cape recently, offering assistance and support to customers on using the various SAFCOIN platforms in English, isiZulu, isiXhosa and Afrikaans, with plans to add more official languages and centres in the near future.

SAFCOIN strives to stand true to its core values of Passion, Appreciation, Simplicity, Trust and Ubuntu.

The SAFCOIN mobile wallet app and exchange can be downloaded on the Google Play Store or the Apple AppStore.  Visit the SAFCOIN website for download links.

Safcoin is a registered member of The Blockchain Association of Africa.

From Classrooms To Boardrooms – How This Former Teacher Became The Richest Man In Algeria

Nzekwe Henry December 13

It is common knowledge, albeit quite a disturbing one, that a significant proportion of the African population is caught up in a mire laden with privations, poverty, squalor, and a general lack of opportunities to improve living conditions.

Due to a combination of political and socio-economic problems spanning several decades, scores of the continent’s inhabitants are known to wallow precariously below the poverty line. For many such individuals, affording the bare essentials of life pretty much remains a mirage and a prerogative of only a privileged few. Most of these people struggle just to get by on a daily, with no hopes of somehow swimming past the murky waters and getting a shot at a decent life.

But even from the most disadvantaged of positions, some of them actually pull through. Those are the ones we like to call ‘successful’, and you know what? They all have one thing in common: courage! This is is what drives them and gives them the nerve to step out of their comfort zones and trudge along the road to success and fulfilment, however unfamiliar the path.

Issad Rebrab; an Algerian businessman, is considered as one of the first persons to make a foray on to the entrepreneurial scene in his country and is known to have trodden a similar path when he resolved to brave the storm and seize an opportunity that most people wouldn’t even want to touch with a twenty-foot pole.

Today, he is mentioned in the same breath as some of Africa’s wealthiest businessmen, but it may have easily been an entirely different story had he not possessed the drive and determination to change the course of his life.

Issad Rebrab’s story starts with humble beginnings and modest backgrounds in Taguemount-Azouz in Kabylia, Northern Algeria. He was born into a family that was nowhere near comfortable or well-to-do in May 1944. His family had barely enough, but perhaps it was just about enough. In any case, Issad did manage to get through school on the backs of some shrewd and, at times, painstaking financial management on the part of his folks.

And you could be forgiven to think you may have figured out where he gets it from after he eventually bagged a degree in Business Management and Accountancy from a professional teacher’s college in Algeria. But that was not to spell the end of his academic sojourn as the prodigious scholar was soon awarded another degree from the Algerian Institute of Management and Planning.

Issad had a pedagogical air about him in his early twenties and this saw him take up a number of teaching roles. Passionate to share the knowledge he had acquired over the course of his studies, he could be seen teaching courses in accounting and business law in several institutions. But given that he was always one with a thirst for new challenges, he was soon going to seek more.

And more was what he sought when he opted to call time on his academic career to explore the ever-flickering embers in his entrepreneurial mind. Apparently, all those years he had spent teaching business-related courses had worked him into a mindset for entrepreneurship and given him an eye for business. And so he ventured.

Not long after he quit his teaching job, Issad Rebrab made his debut in business when he established his own public accounting firm – this was in 1968. However, he didn’t enjoy much success as an accountant and he again found himself seeking a new flame barely two years later. Things actually got pretty interesting for Issad from that point onwards as his life was about to change in more ways than one.

Much of his success can be attributed to the calculated risk he opted to take when he got a whiff of an idea from one of his patrons during one of his consultations. Taking a cue from the advice of this patron of his, he took to stocking up on the shares of a metallurgical company, and this was made possible by the funds he had saved up during his academic career and the little he made during his short-lived accounting practice.

That was in the summer of 1971. It was a risky move on his part because there was just as good a chance of the whole thing proving a fiasco as there was any hope of reaping dividends. But it would appear Issad sees eye to eye with the ‘go-big-or-go-home’ community when he bought up to 20 percent shares in a steel company called Sotecom.

Through some effective stewardship, Issad was able to steer the embattled company to calm waters and it wasn’t long before he oversaw the acquisition of two more steel companies. Prifilor joined the Sotecom fold in 1975 and Metal Sider was snapped up in 1988. And just like that, the one-time teacher and accountant had become something of a one-man behemoth in the Algerian metallurgical space.

But just when it appeared he had steadied the ship and things were beginning to get a semblance of stability, the cruise ship did a Titanic! Things took a turn for the worse when tragedy struck in 1995. Three of his largest and most profitable enterprises were reduced to debris and rubble by terrorist attacks. He is said to have suffered losses in assets amounting to around 1.1 billion dinars. in the aftermath of the ravaging attacks which also threatened his life and that of his family and friends. The best option available to him was to flee the country with his family, count his losses, and fight another day. And that’s precisely what he did.

Dealt a telling blow by the setbacks, he couldn’t help hitting rock bottom. But he didn’t stay there. Well, you know what they say; the only other place to go after you have been struck down is up. Knowing he had once clawed his way to the top, he held strong convictions that he could pull it off once again. And when the opportunity presented itself, he was at the ready.

Issad Rebrab returned to his home country, Algeria, soon after its independence, ready to build again. His efforts soon paid off and in 1998 he bounced back with a company called Cevital. It was through this new enterprise that the Algerian businessman was able to spread his tentacles and diversify his holdings.

Through hard work and some smart decision-making which saw him negotiate many pitfalls, Issad went about building a conglomerate that would dominate Algerian markets and beyond, while bringing about the creation of employment opportunities and the growth of the nation’s economy.

With holdings in agribusiness, steel production, and technology, as well as 26 subsidiaries under four principal sectors, Cevital Group still holds its own today as one of the first and largest conglomerates in Algeria.

The company owns one of the largest sugar refineries in the world; a feat that also sees it dominate over 60 percent of Algeria’s sugar market share. As much as 1.5 million tons of sugar is believed to be produced by the sugar refinery on a yearly basis. Cevital Group is also known to have interests in margarine and vegetable oil processing.

Issad Rebrab is also regarded as an advocate for the diversification of the Algerian economy as he has been at the forefront of moves to break the oil-dependence and poverty. The entrepreneur has contributed significantly to the development of renewable energy sources in Algeria and some of these contributions have involved collaborations with such companies MAN Solar Millennium, Siemens, Abengoa Solar, HSH Nordbank, and Munich Re.

He is also known to have taken up a role in a project dubbed “Cap 2015”; a twenty-billion-dollar project that was flagged off in Cap Djenet, Boumerdes, and is expected to target various such industrial aspects as seawater desalination, automobile production, and power generation.

The Algerian businessman has been pretty vocal about moving his country away from its socialist, oil-centred economy. He is known to have relentlessly championed the movement to make Algeria attractive for private investments and supportive to entrepreneurship.

Issad Rebrab also has stakes in a number of other enterprises including the Algerian arm of automobile manufacturer; Hyundai Motors, and French newspaper, Liberte. In 2016, he added one of Algeria’s biggest media groups, El Khabar, to his holdings in the media – this acquisition is believed to have cost around USD 45 Mn. El Khabar newspaper is one of the most widespread dailies in Algeria. The media group also owns a television channel, distribution channel, and printing press.

Quite recently, the serial entrepreneur who already has his fingers in many pies bagged a partnership with global technology giants, Samsung, which saw him become the brand’s executive representative in his country. Also part of his portfolio is Europcar; an automobile subsidiary which is a car rental service.

The remarkable success this Algerian has enjoyed so far can be attributed to his willingness to overcome the trepidations and step out of his comfort zone in spite of the uncertainties. He has made a name for himself as one of Algeria’s industrial gladiators and one of the richest businessmen in Africa. With up to 18,000 Algerians in his payroll, Issad Rebrab’s businesses are known to employ more people than any other firm in Algeria.

An ever-present hallmark of successful businesspeople is the belief in nation-building and Issad Rebrab is an ardent proponent of that school of thought. A large part of his plans can be related to the economic diversification of Algeria, including one which is believed to involve acquiring a number French tech companies with a view to introducing technological developments in the country and getting more people engaged in meaningful jobs.

Having actively taken part in such initiatives as the Desertec Project which was aimed at facilitating solar energy production in Algerian deserts, he can be said to have weighed in with significant contributions to his country’s development and reduction of its dependence on oil as a sole source of energy.

From those countless hours spent in classrooms and lecture halls, Issad Rebrab has gone on to amass a fortune that is believed to be worth well over USD 4 Bn. And all that while creating thousands of job opportunities in diverse sectors.

Even when his initial venture took a hit and he had to do it all over again from ground zero, sheer grit, passion, and courage got him back on his feet. He was still able to establish a diverse group that meets the varied and vital needs of Algeria and Africa.

His meteoric rise is a testament to the idea that stepping out of comfort zones and seizing opportunities in territories that may come off as unfamiliar and uncharted could unlock that much-vaunted door to far-reaching success.

 

Feature Image CourtesyAlgerie-focus

Incubators vs Accelerators: Identifying Which Is Right For Your Startup

Nzekwe Henry December 12

As an individual who just came aboard the entrepreneurship train and is still learning the ropes, it might take some time to get with the program. And a crucial part of getting with the program is having a good command of the business lingo.

Well, unless you can lay claim to some kind of background in finance, however rudimentary, it might take some doing to keep up with what those business-type folks are yammering about when they begin to spill all the jargons associated with startup vernacular.

Be honest; how many times have you been in that awkward situation where you falsely nod your head in affirmation during some business conversation even though you haven’t the slightest idea what some other person is talking about? Well, if it’s any consolation, you’re not the only one.

So here’s the thing; it is not uncommon for startup founders who are venturing into an industry for the first time to get somewhat bamboozled by the barrage of terminologies associated with that venture.

Getting comfortable with a whole new set of terms – say from angel investor to crowdfunding, seed funding, venture capital, pre-seed funding, Series-A, and a host of others – is not exactly a cake walk. And most people with no prior background in business or finance will struggle somewhat initially – at least, I know I did.

Moving on to the crux of the matter; there’s something of an unspoken debate on the subject of incubators and accelerators with regards to what they are all about and which is best suited to the needs of startups at certain stages.

Although this gets very little attention as most people tend to just sweep it under the carpet as a ‘no-problem’ and use both terms interchangeably as synonyms that can replace each other without raising eyebrows, it takes nothing away from the fact that this is an awful misconception. And many early-stage startup founders can be found wanting with respect to this unlawful marriage of these two distinctly different aspects of the startup business.

Of course, both programs are of immense benefits as they provide guidance to startups, as well as help refine their business models and strategies into sellable ones. Clearly, both incubators and accelerators play vital roles in grooming startups into profitable ventures that can garner investor interest. But it would be utterly misguided to conclude that both are one and the same as obvious differences exist between them.

The differences between incubators and accelerators are well and truly brought to the fore when their respective selection and investment processes are put into perspective. If you are an early-stage startup founder who is having a hard time getting to grips with both terms or deciding which is ideal for your startup, then this x-ray of their different features should come in handy.

Incubators vs Accelerators: Purpose

For incubators, the focus is on startups that have just entered the initial stages of building their company. Incubators are best suited to startups that posses an idea that can cut it in the marketplace, but with no business model and direction through which those “lightbulb moments” can be brought to life in the form of an actually profitable venture.

The key function of an accelerator, on the other hand, is to speed up or advance the growth of a company that is already in existence and it is pretty much functioning with a business model in place. That is to say, accelerators are tailored for startups that have already hit the ground running per se.

An accelerator program functions to consolidate the startup’s position and build on its foundations with a view to propelling them high enough for investors and key influencers to spot them and be wowed and wooed in equal measure.

Incubators vs Accelerators: Duration

In terms of duration, an open-ended timeline is the most likely case for an incubator. Incubators are sort of in for the long haul; they place more emphasis on the longevity of the startup as against its speed of growth. It is quite common for startups to be mentored by incubators for a period spanning up to a year and a half, or even more.

As their name implies, accelerators are all about speed. They are all about putting one’s feet down on the gas and so they don’t take as much time as their opposite number – typically lasting anywhere between three to four months.

Accelerators operate on a set time-frame and it is during that period that startups improve on their products and offerings with the support of mentors, as well as capital made available by the accelerator. And there is also an interesting bit in that startups get to pitch their businesses to investors upon the completion of accelerator programs and who knows what doors could crack open.

Incubators vs Accelerators: Application Process

Incubators are designed for the long route. In these programs, a significant amount of time and resources are devoted to advancing local startups. Incubators generally prove their worth in creating employment opportunities or making moves to license intellectual property. And startups do serve up a path through which both can be accomplished.

Incubators are not fixated on delivering startups that can develop and proliferate fast, especially as advancing the development of local startups forms the bulk of their offering. With that in mind, it is not uncommon for many seemingly slow-growing or evidently less-scalable businesses to find their way into an incubator program.

On the other hand, accelerators place a premium on scalability, investment-worthiness, and high growth potential. That is, only startups that check all these boxes can even begin to fancy their chances of getting in.

Accelerator programs are pretty competitive; seeing applications from a good number of startups and having to select only those adjudged to have the most potential. Hence, such programs use a more traditional and formal model for entry as interested startups have to apply for a specific number of slots in the program.

Incubators vs Accelerators: Environment

This is one aspect where both programs share similarities to a large extent. An environment of collaboration and mentorship is on the cards with both programs and this does a good job of bringing startups together, having them share a space, and affording them access to resources and peer feedback. And all these are known to be vital to the advancement of startups.

Accelerators and incubators also afford startups the opportunity to pick the brains of seasoned business experts and successful entrepreneurs who have been there and done that, and whose experiences can serve up invaluable business lessons.

Incubators vs Accelerators: Investment Capital

It is quite common for incubators to be sponsored by universities or organizations that are focused on economic development, and as such, it is not usually the practice for an incubator to provide capital to startups. And in a similar regard, equity stakes are not usually taken by incubators in the startups they support.

It’s kind of a whole different ball game for accelerators as such programs are known to usually invest a specific amount of capital in startups for an agreed amount of equity. Thus, in some circles, accelerators are assumed to play a greater role in startup success by virtue of this financial commitment. However, this takes nothing away from the importance of incubators.

It’s not really a matter of hopping on the bandwagon of any program that sounds like music to your ears, it’s about identifying what’s right for your startup and acting accordingly. In truth, even though an accelerator program does have some perks which make it seem more appealing, an incubator could do actually do more of a solid to most startups than an accelerator.

Incubators are associated with startups that are still in their formative stages, do not necessarily require investment, and are already part of a local startup community. Although it may require a longer route to commercialization, an incubator is the best bet if a startup’s business model and some other essentials are yet to be resolved.

Through expansive national calls, application processes, and other formalities which would typically involve screenings and vettings, accelerators select their participants. These participating startups are expected to prove themselves investible, rapidly scalable, and also reflect a willingness to migrate to the location of the accelerator for the duration of the program at the very least if need be. Accelerators usually provide funding to startups, typically becoming the company’s first external investor in many cases.

Both programs can undoubtedly be of immense benefits to startups but their obvious distinctions should never be muddled up such that they are considered one and the same. For entrepreneurs and startup owners, the trick lies in identifying which of these programs is best suited to the needs of their respective businesses at their present stages of development. And this can only be achieved through critical reflection.

Egypt’s Buseet Gets Seed Round Extension From Saudi-Based Vision Ventures

Nzekwe Henry December 12

It appears to be raining dollar bills for Egyptian transport-tech startups as the sector has witnessed a flurry of investment activity in the past few weeks and yet again, another transport-tech startup in Egypt has gotten in on the act.

This time around, it is Buseet; a bus-booking platform, that has roped in an undisclosed amount of funding from Saudi-based Vision Ventures. It would be recalled that the startup raised a seed round in September from 500 Startups, Cairo Angels, and some other angel investors. Following from that, the latest investment appears to be an extension of that seed round.

Buseet was established last year by a trio of Founders including Amr El-Sawy, Khaled Moawad, and Mohamed Abdel Aziz. The platform provides a means through which commuters can book modern and convenient minibuses at rates that are significantly lower than regular ride-hailing options while serving up luxury and comfort that is not afforded by public transport options.

The startup’s bus-hailing services are currently available on some fixed routes in parts of Cairo and Alexandria. After its initial launch, the startup’s services were only available through its web-based platform but improvements have since been made and Buseet now boasts mobile apps for both Android and iOS.

Speaking with regards to the development, Kais Al-Essa, Founding Partner at Vision Ventures, enthused that Buseet is unique in that it offers a simple and no fuss solution to a worrying problem by affording commuters an easy, clean, comfortable and cost-effective option which trumps public transport and personalized solutions. He also expressed confidence in the ability of the startup to assist in solving the transportation conundrum in cities with dense population.

The timing of this latest investment could be thought to be quite interesting as it appears to be coinciding with a number of recent developments which have seen Uber and Careem launch bus services of their own in Cairo.

Buseet’s latest investment is also coming at a time when another bus-hailing startup, Swvl, has announced raising “tens of millions” in its Series-B at a valuation that is believed to be on the threshold of USD 100 Mn, with expansion into Southeast Asia also on the cards for the startup. But that appears to be no cause for worry for Buseet’s latest investors who seem to be unfazed by these parallel developments and only poised to grab a significant market share.

Al-Essa also revealed his awareness of the Uber and Careem situation but is taking it in good stride. He referred to the development as being more than anything else, a reflection of the size of the market and the opportunities on offer. He also expressed convictions in the startup’s ability to deliver when he stated that the efficiency of Buseet’s operations compared to its competitors puts in better stead.

While it remains to be known exactly how much funding has been raised by Buseet so far, it is hard to look past the fact that it is probably a long way off from the amount of financial power its competitors have been able to summon in recent times.

And even though the startup may have to reload its financial arsenal pretty soon, it sure looks like Egypt’s bus-hailing segment is about to get a hell of a lot more competitive. If anything, that bodes well for the customers of the service.

 

This development was first covered in a publication by MENAbytes.

 

Image CourtesyMENAbytes

Egypt’s Sawari Ventures Scores USD 35 Mn In First Tranche Of Its New Fund For North Africa

Nzekwe Henry December 12

Egyptian VC, Sawari Ventures, has announced a first closing of USD 35 Mn for its latest fund called Sawari Ventures North Africa Fund I (SVNFI). This development is coming in the wake of reports from earlier this year which suggested that the company will be launching a fund worth USD 70 Mn, and this latest investment is coming as a first tranche.

Technology and knowledge-driven companies in Egypt, Tunisia, and Morocco, are expected to benefit from this latest fund from Sawari Ventures.

A number of global financial institutions including the European Investment Bank (EIB), UK-based CDC, Proparco; the private sector financing arm of the French Development Agency, as well as Dutch Good Growth Fund (DGGF); a fund managed by Triple Jump, are all listed as investors in the fund.

Plans to announce the closing of another ‘Egypt-only’ fund by Sawari Ventures is also believed to be actively in progress. When launched, this fund will run simultaneously with the SVNFI so as to boost the company’s investments in Egyptian startups.

Some of the largest public sector banks, as well as governmental bodies such as National Bank of Egypt, Banque du Caire, and Egypt’s Information Technology Industry Development Agency (ITIDA), are believed to be the lead investors in this fund which will be exclusive to Egyptian companies.

“We are creating the first of a kind VC vehicle to combine top-tier international and local institutional investors to cement VC as an asset class in Egypt; we are initiating a sustainable Egyptian VC industry to ensure availability of funding for future entrepreneurs,” said Wael Amin, Partner at Sawari Ventures.

Such areas ICT, deep technology, fintech, education technologies, healthtech, and renewable/green energy, are expected to form the list of sectors targeted by the fund which aimed at making investments in 25 growth stage companies across those sectors with an average ticket size of USD 1.5 Mn.

“Investment appetite in Africa is growing aggressively, with an abundance of high-growth opportunities waiting for the right funding, and the right partners,” said Amin. “At Sawari Ventures, we have been building knowledge economy companies in this part of the world for years, and our role today will be to channel the available capital to the right entrepreneurs.

Sawari Ventures Partners, Ahmed El Alfi, Wael Amin, and Hany Al-Sonbaty, were all present at the signing ceremony which took place on the sidelines of the 2018 Africa Business Forum which was held at the Sharm El Sheikh International Congress Center. Representatives from both the local and international investors in the fund were also in attendance.

According to one of such investor representatives – Milena Messori; Head of Intermediated Finance for MSMEs at EIB, SVNFI will be used to assist early and growth stage innovative SMEs that have the potential to scale rapidly and grow regionally.

She also expressed her confidence in the ability of the fund to boost the local tech ecosystem, while also stressing that the support to local SMEs and dynamic startups afforded by the new fund will do a solid to economic growth, private sector development and job creation for the young generation.

 

 

Image Courtesy: Wamda

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