Zain Group, a leading innovator of mobile communications in eight markets across the Middle East and Africa, announces its third foray in venture capital investment through a strategic participation in Luxembourg-based ‘Digital East Fund’ that is managed by venture capital specialist Earlybird. The fund has raised US$150 million since its inception in 2013 and invests in early-stage and growth-stage digital companies in Central and Eastern Europe, as well as in Turkey. Investors in this particular fund include the World Bank’s International Finance Corporation (IFC) and the European Research and Development Bank (EBRD), as well as a number of prominent family offices and entrepreneurs from the region.
A pioneer in venture capital, Earlybird was founded in 1997 and has raised in excess of US$ 800 million to date spread over four funds that have invested in over 100 small to medium early-stage technology based entities across Europe and the Middle East. The firm has offices and presence across the globe including in Luxembourg, Berlin, Munich, Istanbul, London and Silicon Valley.
The four venture capital funds that Earlybird currently manages have all had a successful and proven investment approach in a variety of sectors including consumer Internet, enterprise software and services, as well as in medical technology. Impressively, the Earlybird management team’s track record of profitable exits includes 20 initial public offerings and trade sales since 2004.
Commenting on the strategic investment, Zain Group CEO, Scott Gegenheimer said, “Participation in the Earlybird Digital East Fund is a new strategic direction for Zain as we aim to benefit from innovation coming out of fast-growing and dynamic regions of Central & Eastern Europe and Turkey. We believe there is significant growth potential for digitally-focused companies in these regions and this investment showcases our intention to remain at the forefront of innovation.”
On his part Emre Gurkan, Zain Group Chief Strategy and Business Development Officer said, “Zain is increasing its exposure to the digital economy and becoming an active participant in this new digital age with the ultimate aim of capitalizing on the most promising digital ideas that can impact operations in our core business and customer offerings.”
Earlybird Partner, Evren Ucok said, “The convergent ICT space is vibrant, and we are pleased to work with forward-looking telcos such as Zain that embrace the evolving telecom ecosystem. We believe the geographic focus of our latest fund in Central and Eastern Europe, and Turkey is a strategic opportunity for Zain to expand its area of exposure in terms of both services and geographic reach. The cooperation will also provide ‘synergies’ for the Digital East Fund and portfolio companies, many of which have Zain’s geography and business areas on their strategic road map.”
This investment in the Digital East Fund is the third venture capital announcement in recent months by Zain, further building on the establishment of the Zain Digital Frontier and Innovation (ZDFI) business unit in 2014, which is charged with launching Zain into the digital space with the view to growing the company through new innovative business streams that add to the company’s valuation and customer service offerings. ZDFI focuses on the areas of innovation; digital services; corporate venturing; and smart cities.
The addition of Earlybird to Zain’s venture capital footprint complements two other funds Zain has participated in, namely with Middle East Venture Partners and Wamda Capital. Zain now has digital related investments covering the regions of MENA, Turkey, and Central and Eastern Europe, providing the company vast opportunities and scale to benefit from exciting products and services developments in the near-future.