N2V Launches Investment Program for Startups Combining the Accelerator Model with the VC Model
Saudi Arabia based N2V, the holding company of successful Arab Internet brands such as OneCard an e-paymant method that comepetes with Jabbar’s CashU, Net Advantage one of the largest online advertising network in the Arab world and JEEL a web hosting company Saudi Arabia, Mubasher.info a financial portal, Hawaaworld.com women online community and Egypt Development Center (EDC) is announcing its new investment program geared towards startups in different stages.
N2V new investment program combines the accelerator model where they are leveraging thier current portfolio of companies to provide in-kind services to startups combined with the venture capital model of cash for equity.
The new investment program is geared towards early stage and growth web and mobile startups with focus but not limited to Arab entrepreneurs anywhere in the world.
Here is a brief about each program:
Is somehow a virtual incubator that is designed for geek entrepreneurs who have interesting startup projects and developed an initial beta version, -N2V won’t accept project on the idea stage.-
In this program N2V offers startup projects consulting and in-kind services, whether it is actual web development to enhance the beta version of the project, online marketing, online advertising, SEO, PR, online payment solutions, hosting and web design. The cafe startups program does not offer cash but as mentioned above: in-kind services, it also offers mentorship and monetary support for entrepreneurs to attend events and is planning a silicon valley tour for participating startups.
With Cafestartup program N2V does not require the project founders to quit their current job, and a business plan is not required. The founders can work from home or caffe, hence the name “Caffe Startups.”
In Cafe Startups program N2V takes 5-10% equity from the startup, The program is designed to last for 6 month to a year.
Mohammad Khawaja business development manager of N2V and contributing writer to ArabCrunch told AC “We want these startups to succeed or fail quickly.” which is a nice mentality, to see if the project can evolve into a successful business so to take it further rather than to waste resources in something that may not grow.
To me Cafe Startups is a nice model but I think it should offer a bet more, at least some cash for the founders to work full time to grow the project rather than keep it as a part time project. Startup projects need full attention, dedication and commitment to grow. On other side why this program not open for people who have great ideas coupled with experience and dedication but need the technical skills to start it!
Early Startups Program:
Is for either Cafe Startup’s entrepreneurs or early stage startups, in this program tailored after the startup passed the proof of concept phase, and needs to accelerate the growth of their business and grow its team members.
In This program startups are required to submit a business plan. And it try to take the startup project into the next level via cash and in-kind investment. To qualify for this stage the startup needs to answer many questions such as how they will make money ( the business Model.)
The in-kind services are similar to the services offered to the cafestartups program like web development, hosting, online marketing events attendance etc. and is offered “when needed as needed”
As for cash N2V offers up to 1 million USD in this stage in return of up to 40% of equity.
Growth Startup Investment Program:
Is some how a series “B investment” round for taking the startup to the corporate level: hiring c-level executives, forming a board of directors, expand offices in new markets ..etc.. In this program the criteria for startups to qualify for an investment is as Ahamd Takatkah investments program managerat N2V told AC ” passed the proof of concept phase, attracted considerable traffic and have a solid revenue streams and have been around for a couple of years.”
According to Ahmad growth startup program offers cash investment in the range of a couple of millions of Dollars, as for equity take, it is open on deal by deal bases.
In this program N2V is ready to partner with established companies to form a new joint venture project that could evolve into its own spinoff startup, N2V offers cash and in-kind service such as managing, developing and marketing support to new project. Here, the project is owned jointly by N2V and the partner.
“N2V is currently discussing 2 joint projects with 2 different web development companies in Amman, Jordan and Dubai, UAE” Ahmad told ArabCrunch.
N2V is part of National Technology Group (NTG) one of the regions largest IT conglomerate which achieves annual revenues of around 800 Million USD according to N2V CEO Rasheed al Ballaa.
N2V is planning a big exit for itself with an IPO within few years as for the startups it invests in the exit is even via merger and acquisition (M&A) or via N2V IPO.
Here is a presentation from N2V that further explains their investment program: