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Amid Careem Security Breach, Cairo-based SWVL Announces $8M Series A For Commuters

Morning Report: It’s bad and good news for ridesharing in the Middle East this week: Careem ran into its own privacy issues and an Egyptian startup SWVL raised.

Middle Eastern ride sharing app Careem announced yesterday that it was the victim of a cyber breach, marking it the latest in a series of security-related issues for startups and governments globally.

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Careem, which is a play on words (kareem means “generous” in Arabic), is the popular ride share app of choice in the Middle East. The company boasts a known total of $571.7 million dollars in total funding from U.S., China, and Middle East-based investors.

The Dubai-based company, which operates in more than 22 cities in the Middle East, Africa, and Asia, has run into issues with local governments in the past. The company was not licensed in Jordan and drivers would frequently be ticketed for operating under the Careem platform. Still, the app provided a reliable alternative for individuals, especially women, looking to avoid meter arguments with taxi drivers and harassment.

Putting Careem aside, there are positive developments afoot. In a country where street harassment and horrible traffic have long been a topic of conversation, ride-seekers and public transportation users have a new app to rely on. Cairo-based public transportation alternative Swvl announced that it raised an $8 million Series A led by Dubai-based BECO Capital. Participants included Amman-based Silicon Badia, Abu Dhabi-based DiGame, and others.

According to Crunchbase, the company previously raised $500,000 in seed funding from none other than Careem in July 2017. This latest round brings its total funding to $8.5 million.

The company, which on its website markets itself as the “Public Transport… For Millennials,” is giving University students and working professionals alike a viable Chariot-like on-demand bus transportation option in Cairo and Alexandria.

The round represents another scarce datapoint for tech startup funding in the Middle East. According to Forbes Middle East, co-founder and CEO of Swvl Mostafa Kandil said this is the biggest deal announced for a tech startup in Egypt. It is indeed one of the biggest early stage deals  in the Middle East outside of Israel, according to Crunchbase. With its new funding Forbes said the company plans to expand to other areas of the Middle East, Southeast Asia, and Africa in 2018.

From The Crunchbase Daily:

Didi considers IPOing soon

  • Chinese ride-hailing giant Didi Chuxing is talking to bankers about carrying out an initial public offering as early as this year, according to a Wall Street Journal report citing unnamed sources. The company is hoping to secure a valuation of at least $70 billion to $80 billion.

Carbon Black seeks billion-plus value

  • Speaking of IPOs, security provider Carbon Black is moving forward with its plans for an offering, disclosing a proposed share price range that would value the Massachusetts company at over a billion dollars.

8VC closes $640M fund

  • San Francisco-based venture firm 8VC has reportedly closed on $640 million for a new fund. The firm invests in a broad cross-section of technologies, including a focus on logistics and biotech.

Correction: We previously reported Formula1 having acquired PlayON. This was a minority stake transaction.

Illustration Credit: Li-Anne Dias


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