Innovation is alive in the UAE desert, generating value for people that eventually result in multi-billion deals.
So said His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, in a tweet about Uber-Careem deal announced on Tuesday.
He stated: “In 1999, many people questioned our idea to establish Dubai Internet City in the desert. Two years ago, Amazon acquired the multi-billion dirham Souq.com and today, Uber acquired Careem for Dh11 billion. These giant companies flourished from the “desert” of Dubai.”
Careem which is being bought by Uber for $3.1 billion (Dh11.39 billion) was founded in Dubai in 2012 initially as a corporate car service, but eventually adopted a ride-hailing model similar to Uber’s.
The company is based in Dubai. Today, it operates in 15 countries in the Arab world — including Egypt and Saudi Arabia. It recently expanded into food delivery and payments, seeking to establish itself as a one-stop shop for consumers.
Private investors valued the company at about $2 billion last year.
Amazon’s $580 million acquisition of Souq was concluded in 2017.
The Careem deal “will whet the appetite of some of the investors that have been sitting on the sidelines,” Fadi Ghandour, chief executive officer of Middle East venture capital firm Wamda Capital, told Bloomberg.
Ghandour himself had invested in Careem “Traditional, commercial family businesses are going to say ‘okay well this is an investable space, why are we not in it?'”
Uber CEO Dara Khosrowshahi acknowledged Dubai’s emerging status as a global centre for entrepreneurship and innovation in his tweet following the announcement of the Careem acquisition: “Excited to announce our acquisition of @Careem, one of the Middle East’s greatest success stories. This is a testament to Dubai’s role as a global hub of innovation and entrepreneurship and we look forward to continuing our journey in the Middle East.”