SWVL started in 2017 in Egypt and expanded rapidly through acquisitions. It raised $264M in funding over 8 rounds and went public in 2022 at a $1.5B valuation. However, its stock price and valuation declined sharply, falling over 90% due to financial losses. It has downsized operations in some markets and may risk delisting from NASDAQ if its market cap does not reach $50M by July 2023. The document recommends that startups must adapt their strategy based on changing situations and thoroughly evaluate acquisition targets for strategic and cultural fit. SWVL still has potential if it innovates and changes course.
3. Table of
Content
VC & Startup Challenges and why invest in? ..
How SWVL started.
Earning and Investors.
Acquisitions
Recommendations.
4. WHY SHOULD YOU INVEST
IN STARTUPS?
• When asking investors, 42%
say that attractive financial
returns is the main reason to
invest in startups.
• People who invest in
startups are very curious to
learn more about new things,
and startup investing is a very
rewarding learning setup.
• Other motivations to invest
in startups are the impact on
society and supporting you
entrepreneurs.
5. THE BIGGEST REASONS IT IS A GREAT IDEA TO BACK STARTUPS
1
Early Investment
means early
rewards
With the advent
of crowdfunding,
2
Startups are usually in the field of
innovation; they develop new
technologies. Large companies who see
that they can leverage these
technologies to further their businesses
will buy them out. Hence, if the startup
you invested in sells at a high price, you
will enjoy high returns on your
investment.
3
Diversifying Your Portfolio..
it will significantly reduce
financial risks. This is where
startups come in. Startup
investment is substantially
different from traditional
assets, bonds, and stocks.
6. CHALLENGES OF INVESTINGING STARTUPS
The best VC investments are worth more than the rest combined
US Venture Investments 1985-2014
Startup investments are illiquid: When you’re investing in startups that
money is bound for a very long time. You
won’t be able to sell.
RISKS ASSOCIATED WITH INVESTING IN STARTUPS
Money Management: The incoming cash flow could become
more and more complex as the startup
expands. Any mismatches or false
assumptions about the current financial
state of the operation could have
disastrous results, so it may be time to
think about hiring a dedicated accountant
or consulting a specialized service.
7. CHALLENGES OF INVESTINGING STARTUPS
The best VC investments are worth more than the rest combined
US Venture Investments 1985-2014
Wrong Valuations: A common practice of startups is to provide more optimistic of
their company. Valuation . When planning to invest in a startup,
you must study the company’s financial records.
RISKS ASSOCIATED WITH INVESTING IN STARTUPS
Consider the Industry and Market
Conditions
examine the industry and market conditions.
Consider the prevailing market conditions to
know which industries are hotter. It would help if
you also studied society’s needs.
8. CHALLENGES OF INVESTINGING STARTUPS
The best VC investments are worth more than the rest combined
US Venture Investments 1985-2014
Securing The Necessary Funds: Choosing the right sourcing of Finance is paramount.
Startups can apply for conventional bank loans, try to
win grants, look for angel investors, or seek out
venture capital. Each source has its own
characteristics and requirements, and startups should
do their research in order to pinpoint the ones that
align the most with their goals.
RISKS ASSOCIATED WITH INVESTING IN STARTUPS
High Potential for Buy-Outs: Aside from investors, large companies are also looking
out for startups.
Instead of waiting for these competitors to grow, the
large companies will procure the startups
9. CHALLENGES OF INVESTINGING STARTUPS
The best VC investments are worth more than the rest combined
US Venture Investments 1985-2014
RISKS ASSOCIATED WITH INVESTING IN STARTUPS
External Factors: Startups are far more susceptible to the overall
market and economic conditions due to their limited
budget, lack of options for cutting costs, and, in most
cases, offering a single product or service. Negative
external factors such as economic slowdown, shift to a
work from home model, measures affecting specific
sectors (the restrictions imposed due to the COVID-19
pandemic), or even country-specific events such as
Brexit can have a rippling effect and cause issues for
seemingly disconnected businesses.
Returns are unevenly distributed: A small number of startups generate most of the
returns
10. CHALLENGES OF INVESTINGING STARTUPS
The best VC investments are worth more than the rest combined
US Venture Investments 1985-2014
Compared to public equity markets: venture capital is an in transparent asset
class, and many attractive deals are
competitive & hard to get access to.
DECISION MAKING WITH INVESTING IN STARTUPS
Thousands of Startups are: are fundraising at any given moment.
Deal flow: startups that cross your path vs
actively screening the market.
Additional research beyond the deck Market, Competition, Technology.
High upfront costs of due diligence: sunk cost fallacy.
11. IN A CROWDED ECOSYSTEM, STARTUPS NEED ENOUGH FUNDING TO
STICK OUT.. OUR CASE!
To further show that SWVL’s team was mindful of power of funding in
confronting industry giants in the likes of Uber and Careem, Africa Tech
Startups of the total amount of about $686.4 million raised in 2018,
Egypt got a share of $68 million.
Out of Egypt’s share, SWVL got about $38 million backed by some of top
regional VCs including BECO Capital, Raed Ventures, Oman Technology
Fund, and global names like Endeavor Catalyst, making the startup the
most-funded Egyptian startup.
This long-term focus on sustained funding ensured that when Uber and Careem entered the Egyptian bus
public service as SWVL, SWVL had already captured a significant market share and had enough capital.
SWVL’s application has been downloaded for well over 360,000 times on Google play store and Apple iStore.
The platform completes 100,000 rides monthly.
12. How SWVL started.
Definition of the company.
Foundation history.
Services.
Expansion of business.
Partnership Queen's Gambit & Acquisition.
13. Definition of the company
• SWVL is an Dubai-based provider of tech-enabled mass transit solutions, offering
intercity, intracity, B2B and B2G transportation products and services.
• SWVL operates in 135 cities in 20 countries across Latin America, Europe, Africa
and Asia.
• The company went public in March 2022 and is traded on the Nasdaq stock
exchange under the ticker SWVL.
14. Foundation history:
• The company was established by Mostafa Qandil, Mahmoud Noah and Ahmed
Sabah, and they decided in February 2017, at the age of twenty-four, to resign
from their jobs to start their own investment.
• They started developing the SWVL app.
• The development process, in which Qandil used his experience in the
transportation market and the development of digital solutions, took about a
month, as they launched the application to work in the streets of my bank in March
2017.
15. Services:
• SWVL provides ride services with a focus on mass transit.
• Using the app, customers can reserve and pay for rides on private buses operating on
fixed routes.
• The company’s proprietary algorithm uses the passenger’s location and destination to
calculate the quickest trip time.
• The technology also allows for more efficiency than public transportation, which results
in lower emissions. SWVL also provides inter-city rides, car ride-sharing, and corporate
services.
16. Expansion of business:
• At the beginning of the project, the three young men cooperated with tourism
companies to provide transportation buses and agreed that Qandil would assume the
position of CEO of the project, and within one year of the establishment, the company
raised $9 million in funding.
• After that, the partners decided to move the headquarters of their project to Dubai,
and the company's business expanded to include 10 countries, including Egypt, Saudi
Arabia, Kenya, Pakistan, the Emirates, Jordan and Nigeria.
17. Partnership Queen's Gambit:
• On July 28, 2021, SWVL and Nasdaq-listed Queen's Gambit, a special purpose acquisition
company, announced the conclusion of a definitive business merger agreement that would
turn SWVL into a publicly traded company, with a value of up to Swell $1.5 billion. SWVL is
listed on NASDAQ.
• The company obtained $445 million from this deal and plans to use it to expand its
business to include 20 countries over the next four years.
Why SWVL:
• On why Queen's Gambit chose the deal, Victoria Grace, founder and CEO, said in a
statement that SWVL fit what she was looking for, saying it was a "disruptive platform that
solves complex challenges and empowers underserved populations." the environment.
18. After Acquisition:
• SWVL has become one of the most VC-backed African startups. Its listing on
Nasdaq will make it the first Egyptian startup to be offered to the public outside
Egypt.
• It will also be the largest listing of an African startup worth more than $1 billion in
the United States, surpassing Jumia, which was valued at $1.1 billion when listed on
the NASDAQ.
19. 3-Earnings & Investors.
Startup funding round.
SWVL in Numbers.
SWVL funding rounds.
Comprehensive income Statement.
Future investors in SWVL.
20. Pre-Seed Funding
Pre-seed funding is the earliest stage of funding, so early that many
people don't include it in the cycle of equity funding.
Seed Funding
The very first money that many enterprises raise whether they go on to
raise a Series A or no
Series A FUNDING
In a Series A round, startups are expected to have a plan for developing a
business model, even if they haven't proven it yet.
Series B FUNDING
A startup that reaches the point where they're ready to raise a Series B
round has already found their product/market fit and needs help
expanding.
Startup funding
Series C FUNDING
Companies that make it to the Series C funding stage are doing very well
and are ready to expand to new markets, acquire other businesses, or
develop new products.
Series D FUNDING
A series D round of funding is a little more complicated than the previous
rounds. As mentioned, many companies finish raising money with their
Series C.
Series E FUNDING
If few companies make it to Series D, even fewer make it to a Series E.
Companies that reach this point may be raising for many of the reasons
listed in the Series D round: They've failed to meet expectations; they want
to stay private longer; or they need a little more help before going public.
Other types of startup funding
• Crowdfunding
• Small Business Loans
• Small Business Grants
• Private Investors
• Angel Investors
Series Seed Funding
21. SWVL in Numbers
SWVL has raised a total of $264M in funding over 8 rounds. Their
latest funding was raised on Aug 10, 2022,
SWVL is funded by 24 investors. Zain Group and Luxor
Group are the most recent investors.
SWVL has acquired 4 organizations. Their most recent
acquisition was Urbvan on Jul 11, 2022.
22. SWVL funding rounds
Announced
Date
Transaction Name
Number of
Investors
Money
Raised
Lead Investors
Aug 10, 2022 Post-IPO Equity - SWVL — $20M —
Feb 3, 2022 Post-IPO Equity - SWVL 4 $111.5M —
May 7, 2020 Venture Round - SWVL 1 $26M VNV Global
Jun 20, 2019 Series D - SWVL 12 $68M BECO Capital, VNV Global, Vostok Ventures
Nov 22, 2018 Series B - SWVL 9 $30M BECO Capital, DiGAME
Apr 23, 2018 Series A - SWVL 7 $8M BECO Capital, DiGAME, Silicon Badia
Jul 17, 2017 Seed Round - SWVL 1 $500K Careem
May 10, 2017 Non-Equity Assistance - SWVL 1 — —
Total Numbers of Funding Rounds for SWVL.
23. Earnings & investors
Condensed interim consolidated statements of comprehensive income for the 6 months period
ended 30 June 2022
24. 1. Financial performance
business been down in recent period
2. Company’s track record
SWVL doesn’t have a history of solid growth , also There’s more risk as a new
company with no track record
3. Business costs
SWVL operating statements. Shows the costs are going up while the company’s
revue is not
4. Leadership
SWVL leadership and other company officers doesn’t have a solid track record of
success
5. Risk factors
As the other players in the same domain are more established, SWVL
may have a tough time breaking into the market.
6. Dividend history
Good dividends with regular increases tend to mean a healthy income stream
which is not clear in SWVL
Future Investors in SWVL
25. 4-SWVL Acquisition Timeline.
Company , value Value Acquisition Decline
Zeelo, UK 100 M $ April 2022 July 2022
Volt lines, Turkey 40M + 25 M
investment
April 2022 December 2022 (-5 M$)
Shotl, Spain 200 $ M estimate August 2021
Door2Door, Germany August 2021
Viapool, Argentina 10 M$ August 2021
Urbvan, Mexico July 2022
Pakistan (2nd biggest market) 2020 December 2022(down sizing)
26. SWVL timeline
2020
+ 100 M$
10 cities
7 Countries
01
Merging e Queens Gambit
Evaluated e 1.5 B$, preparing for NASDAQ
2021, July
02
2021, August
Expansion
Shotl, Spain-
Door2Door, Germany-
Viapool, Argentina- 10 M$
03
2022, May
100% loss
Decline to 5 $/share
33% Staff Down sizing
06
More Acquisition
Urbvan, Mexico
Decline Zeelo
1.5 $ / share
07
08
Value declined to75 M $ only
95% loss of value
September 2022
Threat to delist NASDAQ
Value: 15 M $
90 M losses
Decline Voltline (5M)
Q4 , 2022
09
Today:21 M $
3.1 $/stock
Seek to reach 50M not to delist NASDAQ by
July 2023
04 Q2 Q3 Q4
02 03
Q1 Q2
Q1 Q2 Q3 Q4
Merging e Queens Gambit **Z
Evaluated e 1.5 B$, preparing for NASDAQ
2021, July
02
Volt line, Turkey- 40 M + 25 M Invest
Zeelo, England- 100 M
2022, April
04
2022, March
NASDAQ Public
Offering
10 $ / share ( over evaluated)
As 1.5 B$ total value
05
2022, July
31. Today:21 M $
2.86 $/share
Seek to reach 50M in order not to delist
NASDAQ by July 2023
32. 5-Conclusion & Recommendations.
• Case of SWVL from to top to struggle to survive.
• Fund raising is not end of the story.
• Strategy should be amended according to situations.
• Acquisition needs deep studies, strategy and culture alignment between
both sides of acquisition.
• SWVL has a good opportunity in case of change & innovation.
