This time last year, the operations of Algerian transport startup Yassir were on the verge of being outlawed in Casablanca, Morocco’s central-western city. Its offense was clear: the city’s authorities did not believe the company had been lawfully licensed to operate. But Yassir’s founder, Noureddine Tayebi (a graduate of Algiers’ National Polytechnic School), had bigger issues to fight. He was hitting brick walls after speaking with hundreds of venture capital firms.
Algeria belongs in the French-speaking part of Africa, and fundraising activities for startups in that axis are few and far-between. In fact, two prominent patterns stand out from how investors invest in startups there. First is that a majority of the investors focus mostly on fintech and renewable energy. Second is that they invest in startups anchored in the English-speaking areas, but which maintain operations in French-speaking countries.
Noureddine was, however, so confident that the same rules would not apply to him. He has an American touch to his background, having bathed himself first in the University of Illinois where he obtained a Master’s Degree in electrical engineering; and in the prestigious Stanford University, where he obtained a PhD in Electrical Engineering, before coming back home to Algeria.
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And so, he delved through his network and sifted through innumerable email threads.
“It was not a simple process,” he said, in his latest interview. “We spoke and presented, for over six months, to hundreds of venture capital firms around the world.”
“We usually convene meetings through our network, which is critical in earning their trust. Once they’ve expressed interest, we work with them for a few months to persuade them and give them time to figure out what they need. I can guarantee you that it was no easy task,” he said.
One thing is evident from all of this: without Noureddine’s US connections, no $30 million in venture money would have been added to the Algerian startup funding map this year.
The list of investors in the $30m round confirms this. All of WndrCo, DN Capital, Spike (Stanford Alumni) ventures, Nellore Capital, Moving Capital (AKA the Uber Alumni Investment Club), and Quiet Capital are based in California; while others such as FJ Labs, Endeavor Catalyst (Endeavor’s co-investment fund), VentureSouq, and Kismet Capital are based in New York, Dubai and South East Asia respectively.
Even angel investors in the latest round (Cleo Sham, former Uber head of operations in Europe and China; Thomas Layton, chairman of Upwork and founder of Opentable and Metaweb; Rohan Monga, former COO of Gojek; and Hannes Graah, former VP of Spotify and Revolut) attest to an investment round inspired by investors from the US.
But Noureddine said, although his solid network landed the team on the doors of the investors, other more measurable factors proved more convincing for flipping the investors to their side.
“You have to be really well prepared and have complete information about the company,” he said. “In general, investors consider three factors, the first of which is the founding team’s profile. They must then determine the proposition’s added value, as well as the size of the potential market.”
WndrCo partner Anthony Saleh confirmed the important role team played in triggering the investment in the transport startup.
“The moment we met the team, we saw the opportunity of entering an enormous market with a service taking the best of models we have seen elsewhere. We’re thrilled to be part of this supercharged journey,” he said.
Aside from the fact that Yassir is where it is now in terms of its newest venture capital round, the company is also headquartered in Delaware, USA, making the investment even easier for the participating investors. However, the company maintains subsidiaries in every country where it does business. Each subsidiary manages its territory autonomously, albeit collaborating with Yassir’s wider network. Each subsidiary also has a team that is entirely local.
But then, of course, the startup’s traction! Since its inception four years ago, Yassir has grown at an exponential rate. It was the first Algerian startup to get accepted into Y Combinator’s winter batch last year. The platform today has over 3 million users and 40,000 partners across all of its markets. It had previously, also, raised $13.25 million in an unreported seed round last year, a fact which, further, cemented investors’ confidence in the startup’s team.
The latest funding in Yassir is one of the highest outside of Africa’s Big Four of Nigeria, South Africa, Egypt and Kenya. Year after year, those countries have gotten the most amounts of venture capital pouring to African countries.
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The Ban In Casablanca
Yassir Casablanca’s operations didn’t seem to pose enough threat to the fundraising ambition. It was then operating in three other Moroccan cities namely Tangier, Marrakech and Agadir, although it must be pointed out that losing Casablanca could be a big deal. The city, home to close to 4 million people, is Morocco’s business and economic capital, and holds a large number of expatriate workers. It is also home to the Port of Casablanca, one of the largest artificial ports in the world, and the second largest port of North Africa, after Tanger-Med.
Two months after, in February this year, Yassir showed defiance and launched its home delivery service, Yassir Express in Rabat, Morocco’s capital city.
The ban in Casablanca was not surprising. In 2015, the city’s authorities issued a press release stating that “Uber Maroc’s activities in Casablanca are illegal” and that its activities are “not authorized, and expose people working there, as well as the drivers involved with the company to sanctions.”
One of Uber’s sins was that while pretending to partner with local tourist transportation unions, it catered to young Moroccans using local credit cards — not tourists.
In 2018, battered by the continued frustration, Uber folded up and left Morocco.
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A Look At What The Startup Does
Yassir, which was founded in 2017, was Algeria’s first ride-hailing app. Since then, the company has expanded into new areas and services. It now provides ride-hailing services to people and businesses in Algeria, Morocco, and Tunisia, as well as food delivery in Algeria.
The startup has over 3 million users, offers on-demand services like ride hailing and last mile delivery, and generates revenue for over 40,000 partners, including drivers, delivery riders, merchants, FMCGs, and wholesalers.
According to Tayebi, Yassir makes money by charging a commission on the services it provides.
Yassir transport strategy Yassir transport strategy Yassir transport strategy Yassir transport strategy
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer