Careem to use funds for global expansion, says CFO

Dubai-based Careem will use the cash from its recent round of fundraising to aid expansion in new markets—mainly East Africa and Bangladesh—along with ramping up research and development, chief finance and development officer Ankur Shah told Argaam on Tuesday.

The ride-hailing service, a competitor for Uber Technologies in the Middle East, also plans to increase its presence in a few countries by adding more cities where Careem’s services will be available.

“We are penetrating further in Jordan, Morocco, Lebanon, and Turkey,” Shah said.

Careem on Monday said it raised $350 million from investors, including Japanese e-commerce giant Rakuten Inc. and Saudi Telecom Company (STC), as part of a $500 million fundraising round.

The latest round of fundraising puts the company’s estimated value at $1 billion, according to Bloomberg.

Shah said Careem might look to go public when “the time is right,” adding however, that there was “no urgency to do that.”

“The capital that we have raised has been through the private market, so there is no need as such to go public for (raising) capital,” he said.

“We had always wanted to build an institution that could stand on its own feet, and for that it would be important to list over time,” Shah added.

In February, Careem’s managing director and co-founder Magnus Olsson told Argaam that an initial public offering (IPO) was part of the company’s goals. He had then suggested that it could perhaps go public in 2017.

Careem launched in 2012 and expanded to Saudi Arabia and Qatar the following year. The service is currently available in 11 countries and 47 cities, Shah said.

The company was self-funded to begin with, but later held investment rounds and received backing from some of Saudi Arabia's biggest industry players.

STC Ventures, a part of Saudi Telecom Company, participated in the Series A round. Tadawul-listed Al Tayyar Group later led the Series B stage. The firm also secured funding with UAE-based Abraaj Group as the lead investor, before the latest round led by Rakuten and STC.

Shah said Careem’s relationship with Al Tayyar has continued to expand on every round, along with developing strategically through operating partnership.

“The goal with Al Tayyar was always to be more than just an investment,” Shah said, adding, “We are exploring logistics, deliveries, field partnerships and all the rest.”

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com