It hasn’t been too long since African startups jumped on the trend that sees them invest in their fellow early-stage firms. Such deals have been repeated, especially in the fintech space.
Today, outside fintech and yonder than the Sub Sahara, history is repeating in an even more intriguing fashion.
Tareeqi—an Egyptian startup credited for developing an app that tracks bus fleets for schools, universities, and institutions—has been acquired by eMushrif.
Why? Omani startup eMushrif specializes in digital transport systems in the Middle East and North Africa (MENA). By buying over Tareqi, eMushrif looks to expand its operations—and will, in the process, leverage on the tech build of the former.
Muscat-based eMushrif is an IoT (Internet of Things) startup founded in 2016 to make bus fleets smart. The company left the ground as a logistics company but has mushroomed into a multi-service provider.
When Adnan Al Shuaili, Awadh Al Shukaili, and Issa Al Shuaili first conceived the idea for the venture, they wanted to engrain smartness into school buses, partly by enabling automatic student roll calls. Now, though, especially since the onset of the pandemic, eMushrif has its hands in other IoT-based solutions.
The company designed an IoT-enabled wristband that can be contact-traced and has provided this solution to the Omani government. On a national level, the wearable helps ensure strict quarantining for COVID-19 patients and people visiting Oman. This product, which also manages onboarding for the said patients and travelers, has sold no less than 14,000 copies so far.
Funding-wise, eMushrif is also on a seemingly steady path. The startup’s pre-seed in 2019 made it one of the first MENA early-stage firm to secure a USD 1 Mn round, and the recipient of its country’s largest ever pre-seed round. In December 2020, the IoT firm raised its Series A, banking USD 2.3 Mn to explore new verticals and markets across the region.
Is that where Tareeqi comes in?
Factually, eMushrif is making inroads to Egypt, the world’s most populous Arab nation and one of the largest economies in the MENA region. There are more than 100 million people in the “cradle of civilization” but that much people occupy only 7.7 percent of Egypt’s 1 million sq km landmass.
“The expansion of eMushrif in Egypt will help the company in increasing its technical capabilities through building a big tech team in Egypt which is famous for having strong and experienced technical talents. The expansion will also enable eMushrif to access the major business opportunities found in the Markets of North Africa. We like the dream of eMushrif of becoming the leader of the IoT sector in the MENA region, and we’ll do our best to help make this dream come true,” said Alfarouk Saleh.
It isn’t disclosed how much eMushrif acquired Tareeq for, neither it is clear whether the two firms will continue operating independently. But the obvious is: an Omani IoT startup is interested in North Africa and has acquired an Egyptian transport tracking firm to take its business there.
That’s the same way payments Stripe picked up Nigeria’s Paystack for USD 200 Mn for its African expansion. Also the same manner in which Branch International took over Kenya’s Century Microfinance Bank. Acquisitions. Acquisitions for expansions.
Plus, the deal couldn’t have happened at a more impeccable time.
Just 2 days ago, the global smart mobility market was forecast to hit a USD 547 Bn value this year (2021). According to a C40 report, every USD 1 invested in public transport could generate USD 5 in economic returns, while every USD 1 Bn planted could create 50,000 jobs. Even in some pockets of Sub-Saharan Africa. mobility solutions are shifting multiple gears.
Interestingly, eMushrif isn’t new to acquisition town. In November 2019, the company bought My Route—a Kuwaiti smart public transportation startup. My Route, like Egypt’s Tareeqi, was quite the young firm as of the time of the acquisition.
In the Egyptian tech-enabled transport scene, there’s been fairly considerable developments. Chief of those is Swvl, a startup operates buses along fixed routes and allows customers to reserve and pay for them using an app.
The company’s co-founder and CEO Mostafa Kandil said in 2019 that Swvl was worth USD 2 Mn 2 years prior. It has raised some of Egypt and MENA’s largest investment rounds, all resulting in ~USD 80 Mn in paid-up capital. The startup chases a billion-dollar status in less than 5 years from now.
The eMushrif-Tareeqi deal could mark not just the first time a Middle Eastern startup is acquiring its lookalike in Egypt but also the first ever Egyptian early-stage firm to be acquired.