While Israel and the Middle East are still growing e-commerce markets, we’re taking a look today at recent developments, what makes them unique and trends worth noting. Geektime. reported 1,400 new Israeli companies were registered with 373 raised investment worth $3.58 billion in 2015. IPOs in 2015 totalled $4 billion down significantly from $10 billion in 2014 while Tech M&As hit a record $8 billion in 2015, up from $5 billion in 2014. William Bao Bean cautioned Israeli startups on the difficulties of doing business in China.
Saudi Arabia launched a $133 million venture fund for startups and opened an office in Menlo Park, CA. A 2015 MasterCard Online Shopping survey found one-third of UAE consumers made online purchases using mobile phones. UAE’s Lulu Group ranked 165th largest and 25th fastest-growing in Deloitte‘s 19th annual edition of Global Powers of Retailing. Carrefour was in 172nd position. Dirk Henke, managing director of Emerging Markets at Criteo, advises Middle East e-commerce companies to concentrate on more than traffic alone. Arab News featured a story on opportunities for women in technology in Saudi Arabia.
$3.6b in funding and $5.4b in exits for Israel’s startups in 2015: report
2015 was another stellar year for Israeli startups, according to a report by Geektime. 1,400 new companies were registered, out of which 373 raised some form of investment, with a combined total of US$3.58 billion. The average deal size was US$10.87 million. The final figure is probably higher – the report only took into consideration investments of US$500,000 and above.
The tally represents 69 percent growth from 2014, when there were 297 funding rounds with a combined total of US$2.2 billion. Via techinasia.com
A Global Perspective Of Israeli Tech In 2015
After a hot start in the first half of 2015, China’s market crash in June caused widespread market volatility, resulting in the lowest number of tech IPOs since 2009. Israeli IPOs suffered in parallel, with only $4 billion in IPO activity this year (down from $10 billion in 2014). Private markets, on the other hand, told a far different story. Aligned with the $713 billion in global tech M&A, dwarfing the previous record of $412 billion set in 2000, Israeli tech M&A surged to a record $8 billion in 2015, up from $5 billion in 2014.
Late-stage activity accelerates, but why?
With 61 private companies surpassing $1 billion valuations, the global trend to “stay private longer” was fueled by a plethora of hedge funds, mutual funds, private equity funds, corporations and private individuals. This trend impacted Israel too, as average time to exit increased from six to seven years in 2015, and late-stage investments in Israel grew from $1.3 billion in 2014 to $2.2 billion in 2015. Furthermore, late-stage funds raised $689 million, more than triple the $214 million in 2014. Via techcrunch.com
China no place for nice Israeli start-ups, says battle-scarred tech vet
For many Israeli tech firms, China is the new Promised Land, a place to find investment money and a huge customer base for technologies developed at home that can be scaled up for big populations, bringing in big profits. Then there’s the support that both governments are providing for Israel-China partnerships – support backed up by money, with both Israel and China investing in incubators, accelerators, university research programs, and much more, to help bring tech from Israel to China.
All all in all, China looks like a great place to do business for Israeli start-ups. So what could go wrong? Plenty, according to China-based investment veteran William Bao Bean. Via timesofisrael.com
Saudi Arabia launches $133m venture fund for startups
Saudi Arabia has formally launched a new ICT (information, communication and technology) fund for startup ventures worth SAR500 million (~US$133 million), known as Riyadh Taqnia Capital. The fund was unveiled at the ArabNet Riyadh 2015 tech conference in mid-December 2015, the funds partners include Riyadh Financial Capital, the General Pension Fund, General Investment Fund and several other state-linked funds.
First reported in Geektime, the fund will have its headquarters (HQ) in Saudi Arabia’s capital city of Riyadh, the international unit will be based in and operate from 3000 Sandhill Road in Menlo Park, California. According to the firm, aside from ICT investments, the fund will also explore investments in the spheres of energy, sustainability and advanced materials. Via dealstreetasia.com
Social media and e-commerce going hand in hand
In the retail landscape, the evolution of social media has in many ways gone hand in hand with the evolution of mobile and e-commerce. With Dubai Shopping Festival set to kickoff on January 1, we have examined the social media trends of consumers in the region, and monitored a rise in the use of Twitter during exciting shopping periods which emphasizes that with the advancement of technology, people’s buying behaviour also changes.
In the 2015 MasterCard Online Shopping survey, of the respondents polled in the UAE, nearly one-third had made online purchases through their mobile phones, which is higher than what was observed in the UAE for results collected in 2012 and 2013. That social media and e-commerce run in parallel is shown by a Nielsen survey that indicates that more than eight-in-10 global respondents (83 per cent) say they completely or somewhat trust the recommendations of friends and family. But trust isn’t confined only to those in our inner circle. In fact, two-thirds (66 per cent) say they trust consumer opinions posted online – the third-most-trusted format. Via khaleejtimes.com
UAE retailer LULU among ‘top 25 fastest growing’
Deloitte released their 19th annual edition of Global Powers of Retailing. It identifies the 250 largest retailers around the world based on publicly available data for fiscal 2014 (encompassing companies’ fiscal years ended through June 2015) and analyzes their performance based on geographic region, primary product sector, e-commerce activity and other factors. See link below: Walmart topped the list with revenue of $485 billion in 2014, followed by Costco Wholesale Corporation and The Kroger Co., both from the US. However, UK retailer Tesco which announced its worst ever results last year in UK’s biggest retail loss was pushed to 5th position.
Middle East retail major, Lulu Group is ranked as the 25th fastest growing retailer in the world and ranked 165th in the Top 250 Global Powers of Retailing while another Middle East retailer, Al Futtaim group(Carrefour) was ranked at 172nd position. Lulu which currently operates 121 hypermarkets and supermarkets across the MENA and Indian recorded an annual retail sales turnover of US$ 5.8 billion last year, according the report published by the National Retail Federation. Based on the robust results, LULU has been on an aggressive expansion drive announcing large investments in Egypt, Bahrain, Saudi, India, Indonesia and Malaysia to the tune of almost US$ 1.7 billion. Via news.kuwaittimes.net
Traffic alone will not sustain e-commerce sites
Dubai: For any ecommerce site, it’s no longer enough to attract eyeballs to the portal. They have to make sure the browsers actually stay long enough to buy something. And if that doesn’t happen and the viewer skips to another, the website still can “chase” them through customised offers put together in a matter of seconds.
This is where algorithms and the companies that do the hard computing come in. “It’s more or less the average that 95 per cent of traffic on an e-commerce site leave without actually purchasing anything,” said Dirk Henke, managing director of Emerging Markets at Criteo, which crunches through as much as 230 terabytes of data each day and handles 15 million requests per second. Via gulfnews.com
E-commerce creates more opportunities for Saudi women
Many economists stress the importance of electronic markets in Saudi Arabia, their financial mega-returns and the availability of jobs for young businesswomen.
A number of economists and businesswomen believe these markets still need organization and codification of their work. They have also revealed that Saudi women are strongly present in these markets, and have achieved success, stressing the need to support the work of Saudi women in this electronic sector. Via arabnews.com
This wraps up a busy week at the Cashback Industry News. We hope you have a relaxing weekend and we’re back in your inbox and online on Monday with more global cashback and e-commerce news.