Viaka #6: Supporting Lebanese entrepreneurs and investors through thick and thin
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Hi everyone, this is Hani. This week, we’re shining the spotlight on IM Fndng one of Viaka’s VC partners in MENA. I spoke with Sami Saad, IM’s VP of Investment.
IM Fndng Quick Stats
Founded: 2016
HQ: Lebanon
Key Individuals: Nicolas Rouhana, Corine Kiame, Carine Assouad, Sami Saad
Raison d’être: IM Fndng contributes to the development of the Lebanese entrepreneurial ecosystem. They work in partnership with business incubators, business accelerators, business angels, venture capital and private equity funds to co-fund or partially insure their investments, and provide needed technical support, to a broad spectrum of businesses in Lebanon ranging from seed stage to growth phase.
Ask: Introductions to expertise, mentorship, coaching, and Series A investors for portfolio companies
I got the chance to chat with Sami about IM’s story, and their goals for the future. Here are some of the insights from our chat.
What is IM Fndng and how/why did it come to life?
IM Fndng groups IM Ventures, a $38M program funded under USAID Lebanon Investment Initiative (LII), and IM Capital, a $20M program funded under USAID MENA Investment Initiative (MENA-II). The main aim of these programs is to develop the Lebanese startup ecosystem while creating jobs and contributing to the country’s overall economic growth.
IM Fndng contributes to the development of the Lebanese entrepreneurial ecosystem. We work in partnership with business incubators, business accelerators, business angels, venture capital and private equity funds to co-fund or partially insure their investments, and provide needed technical support, to a broad spectrum of businesses in Lebanon ranging from seed stage to growth phase.
What is your personal story and relation to startups in Lebanon?
I worked in banking for 10 years, mainly in debt management. During that time, I started making some angel investments, and I eventually moved full-time into VC in 2019. Since then, I’ve worked with IM portfolio companies, particularly in setting OKRs and tracking KPIs. It’s been an amazing experience, and I’m really glad that I have the opportunity to share my experiences with founders, as well as learn from them.
What is the startup ecosystem like in Lebanon?
Less than a decade ago, Lebanon had no access to equity and direct investment for start-ups. Circular 331 of Lebanon’s central bank, Banque du Liban (BDL), was enacted in 2013, which allowed banks to invest up to 3 percent (later increased to 4 percent) of their equity capital in Lebanese start-ups, while guaranteeing 75 percent of losses on any of these high-risk investments.
This initiative led to the emergence of multiple VC, PE, and matching funds for Lebanese startups. Participating banks made most of their investments through outside VC or PE funds. The support infrastructure for entrepreneurs also expanded with several acceleration programs, and Beirut Digital District (BDD) became the hub for the ecosystem. From 2013 to 2018, the ecosystem supported an average of 35 deals per year, worth US $37 million. The number of active VC Funds reached 10, along with 11 incubators/accelerators.
Despite improvements in the entrepreneurial finance landscape, economic growth in Lebanon has been sluggish, averaging less than 2% per year since 2010. In 2019, the economy was hit by a multitude of crises, including a financial and currency crisis, followed by the health crisis spurred by COVID-19, and lastly by the catastrophic explosion at the Port of Beirut on August 4th of 2020.
Investment in start-ups stopped and much of the emerging ecosystem for entrepreneurial finance ceased operations. On the supply side, VC funds were not able to raise further funds for Lebanon, and they were not able to access their funds in bank accounts where a significant value was lost due to the devaluation. On the demand side, start-ups were not willing to accept volatile Lebanese pounds (LBP) in exchange for shares of their companies. Of the 10 VC funds operating in 2018, only IM Fndng remained active (the other 9 were funds stemming from Circular 331). The number of accelerators/incubators is estimated to have been reduced from 11 to 7.
What differentiates IM Fndng from other funding sources?
I think we have a really strong track record since our launch, as well as proven resilience in a trying environment. USAID has supported IM Fndng with a budget of $60m, which we use to improve investor and business access to equity capital, and generally develop the investment ecosystem.
In partnerships with venture capital firms, angel investors and others, IM Fndng invested in 35 Lebanese startups, launched 2 accelerator program, and created 4 angel investor groups leveraging over $35 million in matching investments, resulting in the creation of 400+ new jobs. The program trained and supported a new class of angel investors, launched Lebanon's first seed level business accelerator, and gave over 550 entrepreneurs access to mentoring/coaching.
What are you looking for from the Viaka community?
We have an amazing group of portfolio companies building solutions for Lebanon, the region, and the world. We’re looking forward to introducing them to new expertise, mentorship, and coaching, as well as Series A investors, when relevant.
In particular, right now we’re looking to make the following connections:
Ecomz, a digital platform that enables companies and individuals to create their customized e-commerce websites, is looking for a technical advisor familiar with similar platforms (Shopify, Wordpress, GoDaddy, etc).
Klangoo, an AI-startup providing Natural Language Processing (NLP) to media and software companies, is looking for an advisor familiar with NLP use cases, and that can explore market fits with Financial Services and Health Care.
Band Industries, an AI-powered music tuner and education app, is looking for someone with experience building a SaaS business, preferably a previous founder with digital marketing and go-to-market expertise and a strategist.
Where do you hope that will take you?
These startups contribute to the Lebanese economy by bringing more money into the country, creating new jobs, and serving as role models for aspiring Lebanese entrepreneurs. The more we can plug them into global networks of human and financial capital, the higher the likelihood they’ll be successful!
Promising Opportunities from Our MENA Partners
Below are a list of opportunities curated from the Viaka’s MENA partners.
For Investors
Huupe, the world's first smart basketball hoop, is raising a seed round and connecting with SportTech and Entertainment investors.
Iman Invest is closing a $3m post-seed round to build out their halal BNPL solution similar to Affirm/Klarna, that enables customers to invest and get funding ethically according to their belief
Agel is closing a seed round of $1m to provide Islamic financing options to Egyptian MSMEs in industries previously overlooked by traditional financial institutions.
Startup Falcon is looking to connect with angels and early stage VCs in North America for “user research” conversations to help guide the product development of their startup valuation tool
Desert Farms is raising $3m to start large-scale production, and currently connecting with early-stage investors in FoodTech
For Advisors
Ecomz, a digital platform that enables companies and individuals to create their customized e-commerce websites, is looking for a technical advisor familiar with similar platforms (Shopify, Wordpress, GoDaddy, etc). This opportunity can be compensated.
Klangoo, an AI-startup providing Natural Language Processing (NLP) to media and software companies, is looking for an advisor familiar with NLP use cases, and that can explore market fits with Financial Services and Health Care. This opportunity can be compensated.
Band Industries, an AI-powered music tuner and education app, is looking for someone with experience building a SaaS business, preferably a previous founder with digital marketing and go-to-market expertise and a strategist. This opportunity can be compensated.
Desert Farms is also looking for a senior advisor with D2C startup experience, preferably in the food & beverage space, and with knowledge of the FDA approval process. This opportunity can be compensated.
SubsBase is looking for a senior advisor with early-stage startup experience, particularly in leveraging data analytics to optimize the performance of an Enterprise SaaS business. This opportunity can be compensated.
Agel is looking for a senior advisor with FinTech Experience in MENA, and a knowledge of Islamic financing in particular. This opportunity can be compensated.
For Founders
Plus.vc invests in early-stage founders (up to Series A) that have a MENA background or connection, but are founding their companies outside of MENA.
If you would like to get involved with any of the opportunities above, please fill out the form below and indicate what opportunity you are interested in in the “Reason for Joining” section.
Exciting Announcements From Our Network
Below are a list of updates, wins, and asks emanating from members of the Viaka Network in the “West.”
TechWadi is excited to announce the launch of the TechWadi Membership.
As we all do, we’re launching in Beta – opening it up for our very-first 25 members. Purposefully small because we believe a tight-knit group is key to building meaningful relationships. Click here to learn more and apply to become a member.
If you’re a member of our Network and would like to share your own update next week, email info.viaka@gmail.com.
That’s it for this week. Thank you!
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