This preference is supported by the history of Arzan VC investments: out of the 47 investments we made in the last 10 years, 49% were startups with two founders.

Looking at Pre-Seed deals concluded last year, I’m exploring whether the same trend holds.

In 2024, two-founder startups dominated the Pre-Seed landscape, constituting 45% of all startups in terms of deal count. However, when it comes to capital allocation, two-founder startups did not lead the pack.

67% of last year’s Pre-Seed money went to solo founders

Solo-founded startups (with and without VC funding) became more common in the US in the last 10 years; they doubled to 35% of all startups formed on Carta in 2024.

But, according to Carta’s Founder Ownership Report 2025, VCs continue to prefer funding startups with 2 founders (34%) and 3 founders (25%) over a solo founder (note: US data only).

Is it the story similar for the Middle Eastern founders?

If you’ve come across a general database that tracks the creation of startups on a yearly basis, I’m all ears.

Many deals are announced without a “stage label,” so to keep things simple and effective, my focus today is solely on Pre-Seed deals announced in the media last year. I want to analyze which founding team size was most prevalent and whether it aligns with Carta’s findings for 2024.

One more accurate approach would be to focus only on startups founded in 2024 that received some form of VC funding in the same year. However, I expect that process to involve a lot of missing data, as those startups typically have a limited online presence.

Let’s see the findings.

The region witnessed 50 Pre-Seed rounds in 2024, of which 39 were fully documented. (11 had either undisclosed values, or were described as “six figures” or “seven figures” or they have no online footprint so no further info.)

Funding surpassed $83 million.

In terms of deal count: 2-founder startups dominated the Pre-Seed landscape last year and they represented 45% of all startups. This supports Carta’s findings.

Here’s today’s second-biggest surprise: solo-founder startups surpassed 3-founder teams. 37% of all startups that raised a Pre-Seed round last year were led by solo founders—18 startups in total.

However… How about the capital allocations?

Let’s consider the fully disclosed 39 deals. Solo founders raised $55.8 million, representing 67% of the overall allocation to Pre-Seed in 2024. The “culprit”: Tumodo, a B2B travel platform founded in 2022 by Vladimir Kokorin, secured $35 million. 2-founder startups raised $17 million (20%), while $8 million (10%) went to 3-founder startups.

The 5 largest Pre-Seed deals of last year were: Tumodo (UAE), Mala (KSA), Bokra (EGY), Madfu (KSA) and Octa (UAE). The last 4 are fintechs.

Founding year analysis: Although startups founded in 2024 became more prevalent across the headlines starting Q2 2024, majority of startups that closed a Pre-Seed round last year were established in 2023. About 14% were founded in 2021 or earlier, including one startup as far back as 2017.

While screening, I also took note of the founders’ gender and, of course, ticket sizes (available for 40 deals). See below.

Tumodo’s $35 million round is an anomaly, with the next largest ticket at $7 million. The average ticket size drops to ~$1,240,000 when we exclude Tumodo.

As for the founder gender breakdown, there are no surprises here. Startups founded by males bagged at least $77 million in Pre-Seed funding, representing 43 deals. Mixed-gender startups raised $4.6 million.

Thoughts:

We can conclude that, yes, 2-founder teams had the most success in raising Pre-Seed in 2024. While Carta didn’t disclose the breakdown in terms of capital allocation, my gut feeling is that solo founders didn’t come out on top unlike their MENA counterparts.

The appeal of larger teams over solo founders seems obvious: startups with 2 or more founders remain more stable, even if one co-founder decides to leave. They can share responsibilities and lighten the workload (though I doubt their stress levels are reduced). Multiple founders can be compared to a springboard, fostering better idea-brainstorming and decision-making. Fundraising can also become easier.

The fact that most $ was raised by solo founders signals a contrarian trend in our local VC ecosystem. Are these solo founders solo by choice? While it’s true that a solo founder won’t have arguments with co-founders and their startup vision won’t be easily jeopardized, I’m pretty sure that during negotiations with the existing founder, participating investors would have voiced their preference for adding a co-founder in the near future. This requirement is likely already outlined in black and white.

Out of the 47 investments that Arzan VC made in the last 10 years, 23 were startups with 2 founders (49%), 5 of which had mixed-gender founding teams. In comparison, we invested in 12 startups with 3 founders (26%).

So, in a nutshell, we prefer startups with at least 2 founders, ideally a tech/non-tech mix. But this is a world of exceptions and that’s why we did end up investing in some amazing solo founders – 11 of them in total! cc Zeid Husban, Abdullah AlDayel, Sara Chemmaa, Ahmed Wadi, Ahmad Fuad AlObaid

Let’s see what the team size of our next investee will be ^^

Merit raised $28 million in Series B and unveiled a new logo

Swvl brings private placement to $6.7 million

Hulexo won the Sharjah Entrepreneurship Festival pitch competition!

TruKKer recognized as Annual Vendor of the Year

Mastercard prepaid card by Money Fellows (+ Banque Misr)

Visa card by Lucky ONE

Zid + Abwab.ai

Khazenly + Torod

Hala + Oracle

Gameball explains the concept of loyalty

• Product Manager – App Marketplace & Developer Experience at Zid (Riyadh)
• Product Manager at Hala (Riyadh)
• AML CTF officer at Hala (Riyadh)
• Scrum Master at Hala (Riyadh)
• SW Quality Engineer at Hala (Riyadh)
• Sr Treasury Specialist at Money Fellows (Cairo)
• Financial Analyst at Money Fellows (Cairo)
• Sr Site Reliability Engineer at Qoyod (Egypt, remote)
• Staff SW Engineer at Qoyod (Egypt, remote)
• Financial Planning and Analysis Specialist at TruKKer (Dubai)
• Implementation Engineer at Gameball (remote)
• Sr Implementation Engineer at Gameball (remote)

مبارك عليكم الشهر

Hasan

Today I will explore all the Series B rounds of the region that were raised between 2020 and 2024 (inclusive).

5 of them belong to Arzan VC Family 😉

44 startups raised Series B in the last 5 years

Only 1 out of the 44 MENA-based startups was launched in 2020 (Tamara), the rest is older. (The oldest was born in 2006.)

The variations described below are pretty profound. Well, blame it on 2021 and 2022. 28 Series B rounds happened during those 2 years. (As well as 6 Series Cs and 1 Series D.)

From launch to Series B

– Average time: The average time it took these 44 startups to raise Series B after their launch is 5.5 years. (If we consider only startups founded in 2018 or later, the average is less than 4 years.)
– 2 to 15 years until B: Startups took anywhere from 2 years (e.g., Tamara, Tabby & Kitopi) to 14-15 years after launching (e.g., Altibbi & Unifonic).

Persistence & strategic scaling:

– Startups with longer paths to B: 4 startups took 10 or more years to reach Series B: Unifonic, Altibbi, HyperPay and Noon (the edtech), indicating persistence and strategic scaling over time.
– Tamatem, Salla, Foodics, Eat App and Paymob reached Series B in 7-8 years since launching.

From Series A to Series B:

– Most startups took around 2 years to reach Series B after raising Series A.
– 13 startups raised Series A in 2021 and 77% of them raised Series B over the next 2 years.
– 4 startups raised Series A in 2022 and all of them raised a B round over the next 2 years.
– Quick jumps: 14 companies bagged Series B in the year following their As (or earlier). That’s approximately one third of all. Pyypl bagged Series A and Series B in the same year (2022!).
– Sloooowww jumps: Altibbi took 5 years to hit B (note: they launched in 2008, raised A in 2017 and then B in 2022).

12x Series C & 2x Series D:

– 12 out of the 45 startups that raised Series B in 2020-2024 have already moved on to Series C. Among them: TruKKer, Foodics, Tamara, Tabby… And 2 Cs happened last year: Syarah & Eyewa.
– 2 startups made it all the way to D: Pure Harvest & Tabby.

Sectors:

– Fintech is the leading sector, with a large number of startups focused on areas like payments, lending and financial services (e.g., Hala, Lendo, Tamara, Rain, Money Fellows). Many of these companies raised Series B relatively quickly, often in just 1-2 years after Series A.
– E-commerce
– Foodtech/Cloud Kitchens
– Logistics and SaaS

Tamara and Tabby are the only two startups out of the 44 that stuck to a 1-year timeframe. Both managed to raise Series A in the year following their launch and secured Series B in the year after their A. Both of them raised Series C in 2023 and Tabby is already at D stage.

Calo’s B round made it to our list; it was announced on December 30, 2024.

Conversely, MaxAB didn’t make it to the list – they raised Pre-Series B in 2022 but never got to B. Instead, they merged with Wasoko in 2024. (Eon Dental also didn’t make it – we couldn’t find solid data on their Series A.)

2024 witnessed an uptick in B rounds and I believe this trend will continue in 2025. Some Bs are already being cooked. Plus a few of those 18 startups that could go public in the next few years are in the Pre-B stage.

Your bets?

Data sources: Digital Digest weekly reports, Crunchbase, Pitchbook

Money Fellows Prepaid Card

Watch Zid’s Annual Product Event “Ripple 2024”

Repzo celebrated 8 years in business

Gameball held its first Customer Advisory Board

HAYA Magazine wrote about Citron’s Feeding collection

Klaim revealed its new identity

• Swvl is hiring 10 engineers
• Head of Product Design at Hala (Riyadh)
• Sr Backend Software Engineer (.NET) at Money Fellows (Cairo)
• Frontend Software Engineer (Angular) at Money Fellows (Cairo)
• Scrum Master at Khazenly (Cairo)
• Sr Accountant at Zid (Riyadh)
• Onboarding Engineer at Gameball (remote)
• Part-time Videographer at Citron (Dubai)

I’ll be at Taqadam Investor Showcase (Jeddah) next week. Really looking forward to it!

Hasan

We prepared our usual Wrapped rollercoaster to look back at the past 12 months… Let’s unwrap.

Here’s to new seed deals, non-dilutive capital… and peace in 2025.

Before we step into January (make sure it’s your right foot!), let’s reminisce together about the past 12 months and remember the small and big victories of Arzan VC Family.

So… here’s to new seed deals for our Fund III, more non-dilutive capital for the region’s tech startups through our Revenya Capital and lasting peace for all.

Happy 2025!

Swvl released a newly updated Swvl Rider App

Nearpay got their NSP Certificate.

Healthy meal subscription in Riyadh? Check out FittiEat by FittiCoin!

Zid launched ZidHub

Klaim + Wio Bank

Merit’s logo all over NYSE

Repzo Family is getting bigger

• Senior Product Manager at Hala (Riyadh)
• Corporate Governance Manager at Hala (Riyadh)
• Talent Acquisition Partner at Zid (Riyadh)
• Senior Frontend Engineer at Khazenly (Egypt)
• Sales Professionals at Swvl (Saudi Arabia)
• Reels Creator at Money Fellows (Cairo)

See you next year.

Hasan

We’ve been cooking this project for some time and now that there’s an office, a website, a legal structure, partners ready to get us into deals and a highly capable team in place… it’s time to let the cat out of the bag.

Say Hi to Revenya Capital. A revenue-based funding firm from the region, for the region.

Revenya Capital, an RBF firm for your startup needs

Nearly a decade ago, Ahmad Takatkah used to be an integral part of Arzan VC team. Then he left to the US, worked for Carta for 3 years, then KingsCrowd (another fintech), then KC Capital. As a founder, Ahmad founded 3 startups and he hosts a couple of podcasts. He has an immense passion for data and, most importantly, he is back in the Middle East.

So here’s what we have cooked together.

Earlier this year, Arzan VC forged a strategic partnership with Ahmad to launch Revenya Capital, a groundbreaking revenue-based financing (RBF) firm focused on empowering tech startups in the MENA region.

Building on a decade of VC experience, Arzan VC is branching out to a relatively niche and nascent field in the region: RBF.

And the reason is simple: While leveraging advanced AI and machine learning technologies, Revenya Capital was founded to fill the growing demand for non-dilutive financing options in the region.

Perhaps you’re not so familiar with RBF yet. Let me do a quick intro.

What is RBF?
Revenue-based financing is an essential funding model for startups that prefer non-dilutive capital to fuel their growth without sacrificing equity.

Why is RBF from Revenya Capital so attractive for startups?
No dilution.
No warrants.
No conversions.
No personal guarantees.
No pitch decks.
No data rooms.
No business plans.
No financial projections.

How can Revenya Capital support your startup?

You can use this short-term financing for various needs such as marketing, inventory, events, equipment and seasonal requirements.

If you are a high-growth startups with predictable revenues, Revenya Capital may offer you short-term loans from 3 to 9 months, ranging from $50,000 to $500,000 with a fixed monthly fee of 1.5%-2.5% and repayment rates of 5%-20% of monthly revenue.

Sounds just like what your startup needs right now? Reply to this email and I will link you up with Ahmad.

Merit on stage at FII8

Swvl >>> Riyadh.

Zid’s bold moves

Nearpay got their MPoC certification

Subsbase + Moyasar

DevOps Graduate Program at Gameball

• Head of Strategy at Hala (Riyadh)
• Marketing Manager at Nearpay (Riyadh)
• EHS Manager at Khazenly (Cairo)
• Sales Manager (SaaS & PaaS) at Cartlow (Dubai)
• Senior Sales Executive at TruKKer (Riyadh)
• Marketing Assistant at Citron (Dubai)

See you next week at #MoneyTech Kuwait.
I’ll be speaking on the first panel “The 100 Dollar Question: Where Would You Deploy 100 Dollars Today?”

Hasan

If you’re a fund manager, your What’s next? sounds like “How can I complete the fund cycle?”.

If you’re a startup founder who has taken his/her startup through a good amount of funding rounds, it sounds more like “If I want my company to go public in the future, what are my options in the region?”.

And if you’re like me, you’d also be thinking “Which startups could go public in the next few years and how can we help them get there?”

These 18 startups could go public in the next few years

Over the last 3 years, we’ve seen the number of exits in the region shrink in front of our eyes. 2022 witnessed at least 81 exits of MENA-based startups, 2023 witnessed at least 45 (most of which were in UAE, followed by KSA), but overall it was almost half less than in 2022. And 2024, so far, stands somewhere at 25, a third of which were fintech exits. The overall trend is downwards since the Covid peak yet the market consolidation goes on.

Not enough exits has many negative implications including:
1. VCs who cannot generate returns for their LPs
2. LPs who hesitate on investing in VC funds
3. VCs who hesitate on new investments

Tomorrow I’ll be at SuperReturn in Dubai moderating a panel on “VC exits: creating, not waiting” with 3 gentlemen: Pascal Thomys (Target Global; Investor Relations & Fundraising), Ashish Fafadia (Blume Ventures; Partner) and Venkatesh Peddi (Chiratae Ventures; Managing Director & Partner). (P.S. Our diversity will make the 30-min session pretty insightful.)

But today I want to focus on one kind of exits in specific: IPOs.

I wrote above that exits are down but I also believe that GCC is about to witness more tech IPOs in the next few years – and the region must get ready for them. In KSA itself, as per SVC, more than 13 Saudi startups are preparing to go public in the coming two years.

The article didn’t mention which startups, so I put together a list of 18 potential tech IPOs from our region based on parameters such as maturity level, recent fundraising history and participation in programs like Saudi Unicorns Program (in fact about half of the companies). I focused solely on KSA and UAE startups.

Diverse industries and of course multiple fintechs but there’s also logistics, retail SaaS, food delivery and agritech.

So we can safely assume that there are quite a few good candidates for near-future tech IPOs. The bigger question though is: In practice, where in the region can they go public? Only these 3 options come to my mind: KSA, Kuwait and UAE.

KSA has witnessed 2 startup IPOs:
1. Jahez listed on Nomu in 2022, but in July 2024 they applied for a move to Tadawul (TASI), the primary Saudi stock exchange. Its share price dropped by -57.46% since the listing (data as of October 9).
2. Rasan went public on Tadawul in June 2024 and its $224m IPO was oversubscribed 129x. Its share price grew by 24.74% since the listing (data as of October 9).

Kuwait hasn’t witnessed any startup IPOs yet… but Boursa Kuwait’s historical track record speaks for itself and I can easily imagine startups from the region making successful debuts on Boursa.

And although UAE did rake $6.07 billion from 8 IPOs in 2023, we keep hearing how their tough IPO rules deter startups from listing. Few weeks ago I took part in a closed meeting with Her Excellency Alia Abdulla Almazrouei, UAE’s Minister of Entrepreneurship. Theme: entrepreneurial environment in the country. I pitched an idea of one unified stock market for all of GCC, which is a long term vision but, if executed right, it could help the GCC startup ecosystem while increasing exits out of the region.

Your thoughts?

P.S. Our target is to invest in 3 more early-stage startups before the end of this year… awaiting your decks.

Best Recognition & Reward Program Agency award goes to Merit

2 awards for Subsbase

Swvl secured $2.6 million in Saudi contracts

Taker + Alinma Pay

FittiCoin + MenaME-Plus+

Taker launches aggregation Service APIs for restaurants

Cartlow integrates crypto payments

+1 photo with Yara Burgan, Co-founder of Elevatus (a Fund II company we exited in 2020). Catching up with you was like time-traveling!

• Head of Cybersecurity at Hala (Riyadh)
• Finance Executive at TLC (Dubai)/span>
• Regional Counsel at TruKKer (Cairo)
• Senior Frontend Engineer (Angular) at Money Fellows (Cairo)
• Software Quality Engineer (POS) at Hala (Cairo)

See you this week at SuperReturn Middle East.

Also – Asia will be at Gitex tomorrow.

Hasan

We’ve just made our 47th investment which is also the 4th investment of our AVC Fund III.

It only makes sense that this issue will be all about HulexoA, the award-winning ERP solution based in Abu Dhabi, currently eyeing Kuwait and Saudi.

Welcome to the family, team Hulexo.

This award-winning ERP is our 47th investment

Let’s rewind to 2021.

Huzaifa, Marwin and Ibrahim are working together in an ERP company where they are witnessing firsthand the challenges and inefficiencies that plague the space.
Clients are struggling with systems that are slow to customize and pricey to implement.
They see projects fail due to poor partner choices, resulting in frustration and tons of missed opportunities…

They realize they are driven by a shared vision and decide to leave their jobs to create an ERP solution that not only addresses the above pain points but also redefines what’s possible in the industry.

[Hulexo enters the scene.]

There are plenty of competitors on the scene already. How does Hulexo stand out? It kinda goes against the ERP industry norms.

Robust decision-making engine: The competitors’ systems leave it to the retailer to make sense of the data collected, whereas Hulexo’s system uses a robust decision-making engine to process the data and suggest profitable decisions in real time, reducing stockouts and deadstock while making the operations & decision-making process proactive rather than reactive.

No third-party implementation partners: Hulexo is built using Rapid Application Development Technology (RAD), which allows for 6x faster customization & implementation times. This technology gives it the ability to scale rapidly without ever needing third-party implementation partners, which is the ERP industry norm.

Huzaifa Hameed – CEO (top right); Ibrahim Al Rachdi – CPO (bottom right); Marwin Favila – CTO (bottom left); Kunal Thadhani – Head of Marketing (top left)

Early on in its journey, Hulexo closed a supermarket client inside Abu Dhabi Police College. This client needed a POS system based entirely on RFID cards and store credits, with only 3 days to go live. The team had no experience with RFID technology, but they worked tirelessly, learning and customizing the system on the fly. Despite the tight deadline, they pulled it off and the launch was a success.

Since 2021, Hulexo has onboarded more than 100 retail locations for clients like The Giving Movement, Transguard Group, My Vapery, Padel Life and Nauras Sandals.

Here’s a retail story that stands out for the team:

+1 random fact about team Hulexo— they admire the culture at Zapier because of its emphasis on flexibility & employee empowerment.

What’s next for Hulexo?
300 retail locations by end-2025.
Expansion to Kuwait and Saudi Arabia.
New partnerships with malls, payment providers and licensing authorities.

I guess it’s very clear why Hulexo won our team’s heart. We see it as a game-changer for retail SMEs in the region. We want to support Hulexo’s MRR growth and expansion into Kuwait. Plus, we genuinely believe in the strength of the team.

Your startup = our 48th investment? We will invest in 3 more early-stage startups before the end of this year… awaiting your decks.

Crowd Analyzer got acquired

$3 million for Lucky

happy 8th birthday, TruKKer!

2x Excellence award for Merit

There’s only ONE ORIGINAL Citron!

+500% subscriber growth

ClymbAI in Flat6Lab’s Cycle 3

• Manager – Content at Zid (Riyadh)
• Financial Planning & Analysis Manager at TruKKer (Dubai)
• UX Writer – Arabic Speaker at Hala (Dubai)
• Sr Software Quality Engineer at Hala (Riyadh)
• Last Mile Supervisor at Khazenly (Egypt)

Will I see you at Riyadh’s 24Fintech?

Hasan