Counting On It For The Year Ahead: Financials And Your Business

By now, you will all be setting nicely into 2015, and hopefully, you’ve redirected your focus to the year ahead for your enterprise. As an entrepreneur, a new year is always a good time to reflect and realign your road map. For this issue’s article, I have decided to write about the five points to consider when reviewing your progress to date and planning the next move in your startup journey. My company, Brndstr, is now 18 months old, has raised a total of US$1.6m in seed funding, has more than 10 staff members, and over 30 partners across four countries. We have discovered a lot about our company, industry and approach to the market since we took off as a startup, however, now that we’re a “real” com- pany, we have to evaluate our success and strategically plan the next move. A lot of this has to do with when and where you allocate your precious company resources. It goes without saying that each point (while not specifically addressing amounts) is something you need to consider when divvying up your budgeted spends.

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Making Monetary Sense: How To Understand Your VC Term Sheet

Money matters, and no one understands this more than cash-strapped startups. During the course of startup maturation, founders seek financing alternatives outside of banking, family, and friends. As a result, venture capital funding has been on the rise in the Middle East as “treps in this region pursue greater and more sophisticated sources of capital, with Dubai thus far serving as the funding epicenter. When gearing up to enter into a capital injection agreement, one of the first things you need to be fully knowledgeable about is the term sheet- it’s the initial key document that sets out the structure of a venture capital transaction.

THE BASICS

What A term sheet outlines the principal terms and conditions that will govern a venture capital investment.

Scope This document is almost exclusively prepared by the investor, and it will include the investor’s pre-money valuation of the target company. Term sheets are generally non-binding, though they often include confidentiality provisions and an exclusivity period for negotiations that are binding on the parties. Term sheets are often very detailed, and they should be drafted and negotiated with many considerations in mind. In particular, the parties will need to balance the interests of the target company’s stakeholders. Depending on the stage of investment, there may be stakeholders with differing financial objectives and exit strategies that must be reconciled for the transaction to proceed. Also, each round of financing should anticipate the future capital needs of the company.

Party agendas Venture capitalists (VCs) will seek rights that are commensurate with their level of investment, while the company’s founders will work to maintain capital flexibility and management control and to ensure that the VCs rights are not too onerous.

FOUR KEY PROVISIONS

A term sheet for a venture capital transaction in the Middle East typically includes four provisions: valuation, investment and management structures, and changes to share capital.

1. Valuation

VCs will propose a company valuation in the term sheet, which will determine their percentage ownership in the startup. In an ideal scenario, it would be possible to use certain industry metrics to determine the value of the target company and its expected growth.

Scenario A VC may calculate the company’s terminal value (i.e. its anticipated sale price at the end of the investment term, which is generally five to seven years from the date of the financing) using a multiple of its estimated revenue or on the basis of a typical price-to-earnings ratio used in the industry. The VC could then determine the enterprise’s pre-money valuation (i.e. its current value prior to the investment being made) on the basis of the proposed return on investment, which is often a very large multiple (e.g. 20x).

Pay special attention Unfortunately, new enterprises have little to no operating history, and it’s very difficult to estimate the future cash flows of many businesses that seek venture capital financing. This means that VCs often rely on a number of fluid factors to estimate the valuation included in the term sheet. In particular, many VCs seek to acquire a certain ownership percentage (e.g. 20% to 30%) regardless of the type of business involved and will calculate the company’s valuation based on that threshold ownership percentage and the amount of the proposed investment. Alternatively, some deals are priced based on industry practice for a given stage of investment.

Scenario It may be common for an initial financing round for a particular type of enterprise to be around US$1 million to acquire a large minority interest. Finally, as with any negotiation, the number of participants is important. If only one VC is interested in investing in the startup, it will be able to set the market; however, a company will be able to obtain more favorable pricing if it can secure additional offers.

2. Investment Structure: Conversion, Liquidation, and Dividends

The term sheet will specify the investment structure, including whether the investment will be made through equity, debt, or a combination of both. Most VCs prefer to acquire convertible preferred shares of a startup (rather than common shares or debt) as a condition of the investment. Such shares are convertible into common shares in the event of an exit transaction (i.e. a sale of all of the shares of the company, such as in an IPO, trade sale, or liquidation) and entitle the holder to liquidation and dividend preferences over the other shareholders. Specifically, the holders of convertible preferred shares will receive a certain fixed amount in the event of an exit transaction before any profits are distributed to the common stockholders. The fixed amount is generally the capital invested by such shareholders; however, VCs may seek a higher liquidation payout if the founders have negotiated a higher pre-money valuation. Also, preferred shareholders are often entitled to dividends that must be paid before any dividend is paid in respect of the common shares. If such dividends are available, it is common for such amounts to accrue and be converted into common shares along with the preferred stock (rather than be paid out as cash).

3. Management Structure: Board of Directors and Shareholder Rights

The term sheet will also set out the management structure of the company. In particular, it will define the composition of the board of directors and prescribe appointment and removal procedures. The board structure will depend on the amount and stage of the investment, as well as the background of the investor.

Scenario Strategic investors that are investing not only to grow the startup’s business but also their own may take a much larger role in the company’s management. However, it’s worth noting that VCs and other early stage investors may seek board representation and veto rights over certain issues, regardless of their industry experience. As most VCs prefer to acquire a large minority stake in target companies, it is common for the post-investment board to be comprised of representatives of the founders, the VC, other institutional investors (if any), and independent industry professionals (if required) so that no individual stakeholder will have control.

While the board will be responsible for the day-to-day management of the company, any action related to certain issues (known as reserved matters) must be approved by the shareholders or by a particular group of shareholders. Holders of preferred shares usually vote along with common shareholders and have a number of votes equal to the number of common shares into which the preferred shares are convertible. Preferred shares also typically have special voting rights ascribed to them, such as the right to elect one or more of the company’s directors, approve changes to the share capital, and authorize certain corporate actions (e.g. issuing or acquiring debt, making capital expenditures).

4. Changes to Share Capital

Each stakeholder has its own investment timeline and accordingly seeks to retain flexibility regarding its exit options through each round of funding. The term sheet must address the parties’ rights and obligations in respect of subsequent changes in the company’s share capital.

Anti-dilution Rights Anti-dilution protection is the most important right that a VC will seek to protect the value of its investment. The investor will acquire preferred shares at a price that is determined on the basis of an enterprise valuation of the company, and such shares will be convertible to common shares in the event of exit transaction. The conversion price for the preferred shares will be the share price at the time of purchase; however, the investor will want the price to be adjusted for certain events that would otherwise dilute this price. While certain anti-dilution adjustments are straightforward (e.g. adjusting for stock splits and stock dividends), other adjustments (e.g. for a subsequent issuance of shares at a lower valuation) may be more complicated. It is important that the term sheet sets out the adjustment mechanism for each scenario.

Pre-emption Rights The right of pre-emption is an important measure used to protect the amount of a shareholder’s investment. Holders of preferred shares will generally have a right to participate in any future issuance of securities by the company, which would allow them to maintain their ownership percentage. If the company has competing stakeholders, it is likely that many shareholders will have pre-emptive rights; accordingly, an investor will have the right to participate in new issuances up to its current aggregate ownership percentage. However, if the company is seeking early round financing and does not have many stakeholders, preferred shareholders may be able to acquire a larger portion of the new shares or debt.

Right of First Refusal Most shareholders will retain a right of first refusal in respect of any proposed transfer of shares. Specifically, a shareholder that wishes to sell its shares to a third party must first offer the shares to the remaining shareholders on the same terms and conditions as those offered by the third party. The non-selling shareholders will have the right to participate in the sale on pro rata basis in accordance with their shareholding.

Drag-along and Tag-along Rights While rights of first refusal are rarely contested for a partial divestment, some investors may find this protection to be inadequate based on the size of their shareholding and their investment objectives. Accordingly, it is common for shareholders to push for drag-along and tag-along rights. In the event that a large shareholder (or, more likely, a group of shareholders holding a large portion of the shares) wishes to sell its shares and the remaining shareholders do not elect to exercise their right of first refusal, the majority shareholder may have the right to compel the minority shareholders to sell their shares on the same terms. Large stakeholders will insist on this protection, as a third-party purchaser may require the company to sell all of its shares as a condition of sale. Conversely, the minority shareholders may have the right to participate in the majority shareholder’s sale, in which case they may require the majority shareholder to arrange for the third party to purchase the minority shares or to purchase the shares itself on the same terms. The term sheet should prescribe the ownership threshold above which the drag-along and tag-along rights would be triggered and should identify the shareholders that must initiate the proposed sale (if any) and have the right to participate.

Co-sale Rights and Lock-in Periods Certain transfer rights and restrictions apply specifically to the shares held by the company’s founders. For example, an investor may also seek co-sale rights, which would give the investor the right to sell a portion (rather than all) of its shares as part of any sale involving a founder. Also, it is common for VCs to insist on imposing a vesting period for the founder’s stock, during which the company will have the right to repurchase a certain percentage of such shares (which would decrease over time) at cost (or less in the case of misconduct) if a founder terminates his or her employment. The vesting period is generally tied to a lock-in period during which the founders are prohibited from transferring all or, subsequently, some of their shares. In some cases, incoming investors may also be subject to lock-in provisions (e.g. strategic investors).

The demand for venture capital funding in the Middle East is on the rise as successful startups emerge from their cocoons and seek greater capital commitments through sophisticated financing structures. Basically, this has resulted in expanding opportunities available to investors and SMEs. As a company founder looking to secure an advantageous capital injection, you need to know your term sheet, and this means doing your homework.

On A Roll: Chez Sushi Prioritizes Regional Expansion

Since its launch in 2013, fast-casual Japanese restaurant Chez Sushi has managed to find a loyal following in the UAE, and after having opened three outlets in the country, it’s now gearing itself up for further growth. “Both the loyal sushi-loving customer and a growing customer base have taken to Chez Sushi’s fast-casual dining concept, driving popularity for the brand,” says Hiba Kosta, Chez Sushi co-founder and Managing Partner. “The evidence of this is that Chez Sushi has seen market demand drive a growth rate that has seen a new location open, on average, every six months since opening in 2013. There are also a further two outlets set to open in Q1 2015.”

But the UAE is not the only country that Chez Sushi is targeting as part of its expansion drive- in December, the brand launched its first non-UAE franchise in Oman. Kosta reveals that Chez Sushi has partnered with Abu-Mai LLC, a sister company of the OHI Group, for its operations in Oman, and even as the first outlet secures its place in the market, plans are already underway for a second branch to be opened in Muscat in the next five months. “When we first announced that we were franchising, we started to get a lot of emails from Oman asking us to open there, [and] we realized that the market in Oman needed Chez Sushi,” Kosta says. “We were ready to open outside of the UAE. Oman came at the right time, [and its] geographical proximity to Dubai made it even easier for us to set up and allow [our partners] to send their team to train with us in Dubai.”

Oman just marks the beginning of Chez Sushi’s regional expansion plans. Kosta says that plans are underway for a presence in Bahrain in the next two months, with the company having signed a deal with a local F&B management company, Eatcorp.”The plan is to take Chez Sushi to markets that show a gap in the market for the fastcasual dining concept,” Kosta explains. “Having started in the UAE, the regional markets are the more obvious destinations to explore, as there are certain similarities in these markets that can be learned from. That is not to say, however, that we would limit growth to the region. We need to be assured of the need factor and demand in the markets we are assessing. In fact, that will always be the driving factor for any growth– whether we can add value to a given market, not growth for growth’s sake.”

Kosta also says that while Chez Sushi’s model for expansion has been firmly in place from the start, she and her team have been cautious about driving its expansion as well. “In order to look at a franchise model for international growth, then it is vital that you have 100% certainty over the essence of the brand,” she explains. “It is only if you have that confidence, backed up with guidelines, that you can ensure a quality maintained to the same level as those owned, in the home market. I would not have the confidence to expand onto the international scene without having faith in the brand’s identity and transferability into multiple markets. However, I still take a personal interest and I’m involved in the launch of every new location that opens, so I can see for myself that everything is as it should be.”

Tackling Youth Unemployment: Startup InternsME Wants To Help Your Company Find The Right Fit

The reality for the youth workforce is dire. According to the International Labour Organization, the Middle East has the highest youth unemployment rate globally, with it being 29.1% in 2013. Students and graduates get stuck in a conundrum: besides trying to attain wasta or connections, they can’t find a job without experience and they can’t get experience without a job. There’s no quick fix to youth unemployment and career portal InternsME aims to assist in filling the gap between education and workplace in UAE through internships and trainee placements with an online platform– a cost effective solution for companies to grow their teams.

To stand out among job seekers, the platform focuses on video resumes, or “visumes’ as CEO and co-founder Jean-Michel Gauthier calls them. Since students and fresh grads lack experience, CVs can seem bare: “It’s been difficult for hiring managers or company owners to really gauge someone based on their CV. Visumes became the obvious choice to help candidates highlight their strengths, communication skills and personalities.”

Being a video-centric employment platform, InternsME found that it’s a great way for candidates to foster confidence and practice their personal pitches. Gauthier says that approximately 40% users have uploaded videos, adding that users with good visumes “tend to get snapped up into placements very quickly.” To further help reserved and unsure users, the career portal is providing free recording sessions at their office to support and guide users. At first, attracting users to sign up was a chicken and egg scenario. They needed candidates to attract employers and vice versa. The portal managed to get candidates to sign up first by getting support from educational institutions and generating content -such as blog posts and videos on interview tips, creating video resumes, etc.- until jobs were available.

“It wasn’t easy at all, especially for the first several hundred- early adopters are seemingly rare in Dubai.” Besides building partnerships with universities through fairs, workshops, and roundtable discussions, word-of-mouth was also a big help. Gauthier explains that they spoke to candidates as part of their screening process to better understand their strengths and job-seeking preferences. As someone who tried out the platform in 2013, although they weren’t able to find me a match at the time, I can attest to this and I applaud their efforts to get to know me and what job I was most inclined to land. Others echo my sentiments too, as Gautheir says users feel the difference from other placement portals.

Regarding the current state of youth employment in the region, Gautheir admits that most employers still aren’t providing internships, and they “even come across the odd employer who asks us, “What’s an internship?'” There’s been positive change, but the situation still has a long way to go. Startups and SMEs are “eager” to hire from the young workforce, however some are still “reluctant” to deviate from their established “recruiting methods and reliance on experienced staff.”

The team often liaise with employers in a bid to disprove misconceptions and impart guidance. Gauthier believes there’s always a way for them to fit in to an organization, it’s just a case of “link[ing] it back into a company’s needs and objectives.” He asserts that for cost-conscious startups, internships can help in expanding a team, keep the cost and risks low, and it’s an opportunity to see how possible future hires can fit in before having them join your team full-time. Interns help to build a “healthy company culture, as they bring onboard fresh perspective, ideas, drive and diversity.”

So how can startups facilitate a good working environment for interns, who are usually millennials? Gauthier reminds employers that the needs of the young workforce varies: “They seek to be inspired, empowered and to feel part of something exciting.” Interns can bring more impact if presented with opportunity “to contribute their ideas and take responsibility of tasks”. It also goes a long way when companies are considerate accepting interns who may still be studying. “Startups need to be able to answer, why are we a great place to get experience, or start your career at?” In terms of the discourse between unpaid/paid internships, Gautheir stresses how internships are primarily for gaining work experience, and a small stipend to cover expenses is recommended.

To further bolster and support their online presence, InternsME staged The Talent Hunt last year to gather 16 employers with more than 400 candidates for a session of “speed interviews”; both sides have a short (two to three minutes) conversation to get to know one another. The co-founder says that the event was very successful, and that “hundreds of applicants are now under consideration as a direct result of the event.” Besides planning a relaunch of their website and grow their team, the startup also intends to frequently host more employers-meet-candidates sessions.

FOUNDERS CEO Jean-Michel Gauthier oversees day-to-day operations, and Elizabeth Zeibari and Jason Mathias act primarily in an “advisory capacity”. The founders are aged 28, 30 and 31 respectively, with backgrounds in pharmaceuticals, advertising and various other commercial experience.

FUNDING InternsME is backed by angel investors, who also act as board members and advisors to the startup.

BUSINESS MODEL Companies can join the InternsME employer network for a small fee. The portal allows them to post jobs, search for graduates, watch video CVs and recruit talent.

Beam Wallet: Making Shopping More Rewarding

For a company that was established only in 2012, Beam Wallet had much to celebrate when Majid Al Futtaim Ventures announced a “landmark investment” in the UAE-based mobile commerce and rewards platform in December last year. The Beam Wallet mobile app, which is used by more than 100,000 users at over 1,100 outlets in the UAE, now looks set to become a key player in the mobile commerce space of not just the country and the wider Middle East, but internationally as well- small wonder then as to why the people at Majid Al Futtaim have taken a shine to this enterprise.

“We always believed that the payment industry is going through a transition,” says Rasool Hujair, CEO, Majid Al Futtaim Finance, noting that the idea that mobile phones will one day replace our credit cards (and our wallets) has been a topic of discussion for quite some time now. “We live in a different environment [now], where mobile is becoming dominant,” he explains. “It’s really personal and it’s so powerful that it has the potential to change a lot of our habits and enhance a lot of our experiences. And so, it’s no surprise that it has eventually found a way into the payments industry as well.”

But Hujair is quick to point out that customers aren’t going to change their payment habits (i.e. move from their wallets to their mobiles) unless there is a significant advantage to them. “Payment is boring,” Hujair admits. “You’ll do it because you have to. And quite honestly, there’s nothing wrong with plastic for that. But the consumer is becoming far more sophisticated. So we were looking at how we can enhance the customer experience, how we can create value, how we can make it so powerful that consumers would change their habits and move from plastic to mobile.”

And that’s what makes Beam Wallet an interesting proposition. It’s not just a payment app- customers also get to reap rewards for all of the shopping that they do through it. “Beam is a mobile wallet, a digital wallet,” explains Shezan Amiji, co-founder, Beam Wallet. “The value proposition to consumers is about being able to shop, pay and earn rewards in a single app, in a single transaction, in a single step. We are card agnostic- so you can use [Beam Wallet with] any card from any bank, with any telco, on any phone, on any operating system.”

But it’s not just the consumers who get to benefit from Beam Wallet- retailers are being given the opportunity to make use of a powerful mobile marketing platform for their businesses as well. “Businesses have realized that they have to embrace mobile- if they don’t embrace mobile, they will be left behind,” Amiji says. “But the problem with mobile is that, for a small business, it’s quite expensive and difficult to develop a compelling app. The cost of developing a website has come down considerably, but the cost of developing an app has still not, because the experience is very difficult to map on the phone versus the desktop.”

“And that’s where someone like us come in,” he continues. “Because we live in that space. Our business model is such that the business never pays us without a transaction. They take no risk upfront- they only pay us if we deliver value to them. So enabling Beam at their point of sale is at no cost to them… Our model has been [made] to completely de-risk it for the business, in terms of giving them this mobile marketing platform that they only pay for if they get value out of it. And if they don’t, they don’t pay us.”

Given the features that Beam Wallet boasts of, it’s easy to see why Majid Al Futtaim, a leading shopping mall, retail and leisure pioneer in the MENA region, decided to invest in the app. But this wasn’t something that happened in a day either- on the contrary, the entire process took about a year, Hujair says. It had its hurdles- for instance, when Beam Wallet first approached him and his team, Hujair candidly admits that he wasn’t too taken up with its idea and the value that it could potentially bring to the Majid Al Futtaim enterprise.

But the more Hujair and his team spent time on developing their strategies and their short-term and long-term visions, the more they realized that Beam could play an important role in serving their customers better. “There was a synergy between our strategy and what they were trying to do,” Hujair explains. “But obviously, for Majid Al Futtaim to invest, we needed to be sure that this technology and the people behind it have what it takes to meet our needs today, but also to keep the product alive and [further] develop it as time passes. Technology is always evolving– so we wanted to be convinced that the app too can evolve with time.”

Majid Al Futtaim then went to work, doing all of the due diligence needed to check out Beam Wallet not just from a technology standpoint, but from a commercial perspective as well. They did their research, ran the app by experts, compared it with other similar products in the market, and ultimately came to the conclusion that Beam Wallet and their “cutting-edge technology” was, indeed, a good enterprise to partner with. While Hujair didn’t reveal any specifics with regards to the actual value of the Majid Al Futtaim investment in Beam Wallet, he did say that that it was a “substantial” amount, and that it was in “the high seven figures.”

From Amiji’s viewpoint, having Majid Al Futtaim back his company had an added bonus besides the obvious boost in resources. “You know, Majid Al Futtaim is a great name in this market,” Amiji says. “So it kind of validates the business. It validates the business model; it validates that what we have built has value, if someone like MAF has decided to invest in it.” As for what’s next for Beam Wallet, Amiji says that his 16-member-team is now focusing on three things: the expansion of the business in the region and beyond, the acquisition of new users for the app, and the addition of more functionality to the product. With big things being predicted for the mobile commerce space in the upcoming months, Beam Wallet looks all set to becoming a key player in this particular arena.

Beam Wallet vs. Apple Pay

“Apple Pay is the best thing that can happen to us,” says Shezan Amiji, when asked about his thoughts on Apple Pay as competition for Beam Wallet. “Because it accelerates acceptance in the market, it raises awareness about mobile payments for everybody, it kind of helps the consumer overcome a number of issues they may have [on] security and convenience [in mobile payment]. So, in many ways, I think Apple Pay is an opportunity for us, rather than a threat. Apple Pay creates an ecosystem for us to plug into. Apple Pay only sets the foundation, and people like us will build value on top of the ecosystem they create.”

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Four Seasons Doha Wants You To Move Right In, And Stay Awhile

“The Four Seasons Hotel Doha is not just a place to sleep for business travelers. We care about our guests’ comfort, and creating a suitable environment and amenities that allow guests to concentrate on the business at hand, and feel at home when it’s time to relax. We also provide the right service and technology that helps business travellers to feel at ease when they are traveling,” explains Rami Sayess, General Manager of the Four Seasons Doha. A large majority of the hotel’s guest roster is business-travel related (Sayess estimates that it goes as high as 70% to 80%), but adds that it varies depending on the day of the week and the time of year. When marketing to a business client, their “strategy is to always ensure consistency in service, and product delivery while building an outstanding level of recognition for guest needs. Time is of the essence for this traveller, so we have to also ensure that we are efficient in our service experience.”

A graduate of Hotel Management from Les Roches Hotel School in Switzerland, and certified in Hospitality Management at Cornell University, Sayess’ primary concern is crafting an individualized environment that each guest can call their own. When catering to a business client, Sayess stresses that luxury hospitality properties must execute “personalized service with strong guest recognition”, convenience in terms of amenities and location, and consistent connectivity. He also notes that the need to dress for success is well-noted at the hotel, encouraging their business guests to take advantage of their express laundry service to “look impeccable” for the boardroom. A veteran of several Four Seasons properties over a decade of service, the GM thinks that their personalized attention will help you settle in just right, and that includes catering to your rest preferences.

F&B

Recommended by the GM

CONNECTIVITY “The modern world is always connected, and business travellers expect no less from their hotels. It’s essential that we provide complimentary Wi-Fi with fast Internet connection for our guests. We continually update our audio-visual presentation equipment, and special arrangements can be made to fulfil any request supported by technicians onsite. The hotel also offers state-of-the-art audio visual equipment that includes LCD projectors, screens and drape kits, video cameras, video projectors, video players, microphones, mixers, amplifiers, stands, carts, easels, flip- charts, laser pointers, speaker timers, personal computers and peripherals.”

CORPORATE SPECS “During our nine years in the market, Four Seasons’ name has been synonymous with special events of the highest caliber including prominent banks, oil and gas companies, and companies from different segments within the region. We have assisted them in organizing their events from A to Z- from preparing invitations, to designing backdrops, choosing menus and more. Our proven talent, professionalism and artistry assures flawless events for all of our guests.”

CONFERENCE CAPABILITIES “Four Seasons Hotel Doha offers Al Mirqab Ballroom with its own pre-function area, as well as a large outdoor terrace and five well-designed, spacious conference and banqueting venues that can be adapted to suit gatherings of virtually any size. In addition, two boardrooms in the Business Centre meet the needs of business meetings. All our venues are complemented by exquisite cuisine, intuitive service, and a sense of elegance, providing the perfect setting for an exclusive event.”

MUNCH “My favourite restaurant in the hotel is Nusantao! It specializes in authentic pan-Asian dishes, where the food is prepared with theatrical flair by our multicultural culinary team. My all-time favourite is charcoal grilled miso Atlantic black cod. I’m not a spicy food lover, but I love Asian food.”

EXEC STAY “We have a dedicated concierge to assist guests with travel arrangements, car bookings, restaurant reservations, city recommendations, or the unexpected. For example, if a guest forgets a tie or a cufflink, our team will graciously help the guest with the needed item.”

Trippy ‘Treps: HolidayME Says That You Can Set Up Your Entire Vacay in Just a Few Clicks

Who doesn’t look forward to their next holiday? You’re probably thinking about your next trip as you read this. That said you probably aren’t thinking about the hassle of it all; after all, it’s a lot more than just booking plane tickets. Do endless tabs on your web browser of hotels, things to do, and little to no time to figure things out ring a bell? Two Dubai-based “treps, co-founder and Managing Director Digvijay Pratap and co-founder and CEO Geet Bhalla, are trying to put this to an end to this hassle with HolidayME. “We were convinced that the market needed a simplified platform to plan and book a holiday experience with a few simple clicks,” explain the co-founders. Self-proclaimed avid travelers Pratap and Bhalla make a solid team with their different skillsets. Pratap holds a Master’s degree in Computer Applications, and has worked as a software engineer for various businesses in different industries, from hospitality to e-commerce while Bhalla has spent the last 15 years in finance and banking technology.

What makes HolidayME stand out from its competitors? Everything is in the customers’ hands. Sure, you can book flights and hotels through other platforms, and maybe even have a bunch of packages to choose from, but HolidayME lets you customize. The co-founders proudly claim that HolidayME contains a “wide inventory of over 1,00,000 hotels, 8,000 sightseeing activities and airport pick-up and drop facility across 300 cities globally.” A small team of “five people out of a small garage sitting across from each other, brainstorming and exchanging ideas,” eventually turned into a multinational venture with offices in the UAE, India, Saudi Arabia, and a team consisting of over 85 people. The co-founders approach to HolidayME focuses on the technological aspects “right from the onset, we wanted to create proprietary technology and IP.” Long story short, it was indeed capital intensive.

When it comes to money and finances, HolidayME’s current situation looks nothing like it did in its early days. The co-founders are enjoying a “Series A funding of US$4 million by a consortium of investors led by the Al Sanie Group based in Saudi Arabia,” making bootstrapping a distant memory. They chose not to comment on return on investment projections, stating that their “focus at the moment is not ROI, but to grow and capture this evolving market.” Bhalla and Pratap have stressed on the importance of effective marketing to stand out in a sector some would call saturated. The co-founders “have already started with online campaigns through paid search, display and social channels,” and kicked off above the line (ATL) advertising campaigns this month. Social media plays a huge role in their marketing campaign- HolidayME can be reached on various social media platforms, with the co-founders mentioning Facebook, Twitter, and Pinterest. That said, they both believe that Facebook “from a business perspective” is their favorite platform, noting admin access to detailed analytics, plus its high user base in the region.

So how have folks received HolidayME so far? The co-organizers are quite pleased with what they’re seeing; what they’re happiest about isn’t just website engagement, but “it’s particularly reassuring to notice so many users using the customization option to build their itinerary and make a booking.” Most popular holiday destinations thus far on the portal? “We are getting major queries for European and Asian markets including the popular touristic destinations like London, Paris, Amsterdam, Thailand, Turkey, and Egypt. There is also great demand for Dubai packages.” Next up for the startup is growth, and they’re currently focusing their energies on targeting Middle Eastern markets, specifically the GCC and Egypt, and plan to launch an Arabic website in the near future. When asked about targeting India, where they currently have some presence, the co-founders admit that the Indian market is something they aren’t interested in at this point in time, and that they simply “drive [their] technology development from our office based in India.” Travel buffs who want to use HolidayME via their mobile device can expect an app later this year, and both Pratap and Bhalla recognize the skyrocketing amount of mobile internet usage in the region.

When asked about which MENA city harbors the best entrepreneurial ecosystem, the co-founders chose Dubai, citing its “culture and financial landscape.” For now, with funding secured, the main concern for these “treps will be to continue to onboard users, and actually get them to use their services. Maybe it’s time to take a trip!