Egypt’s Swvl secures extra $21.5m PIPE funding

Swvl, an Egyptian mobility company, has raised an additional $21.5 million in private investment in public equity (PIPE) as part of its proposed business combination with Queen’s Gambit, ahead of its future Nasdaq listing.

Swvl, founded in 2017 by Mostafa Kandil, is a mass-transit system that allows riders heading in the same direction to share a ride in a van or bus. The startup’s proprietary mobility solutions are assisting in the resolution of mass transit supply and demand challenges in emerging markets, providing underserved communities with transportation solutions that are dependable, convenient, safe, and affordable.

The startup is one of the most well-funded in Africa, and it is now present in ten cities across Egypt, Kenya, Pakistan, the United Arab Emirates (UAE), Saudi Arabia, and Jordan.

Swvl’s gross revenue and markets have expanded rapidly, with over 1.4 million riders booking over 46 million rides with thousands of drivers on its platform to date.

Swvl was set for an initial public offering (IPO) on the Nasdaq exchange last July after a merger with special purpose acquisition company (SPAC) Gambit Growth Capital valued it at US$1.5 billion, making it a rare African “unicorn.”

Swvl has now reached agreements with new investors, including the European Bank for Reconstruction and Development, for an additional $21.5 million in PIPE funding (EBRD). The investment, according to Kandil, is a “clear vote of confidence” in Swvl’s growth strategy and future as a public company.

“We continue to make significant progress toward our strategic objectives.” We are confident in Swvl’s ability to bring its transformative technology and services to new markets, thereby transforming a US$1 trillion global mass transit industry in desperate need of effective solutions. “We are excited to complete the business combination, go public, and continue to create tremendous value for all stakeholders,” he said.

Victoria Grace, founder and CEO of Queen’s Gambit Growth Capital, stated that since announcing the proposed business combination with Swvl, the Swvl team has gone above and beyond every element of its business plan, with strong execution across its existing markets and the pursuit of additional attractive market opportunities in new geographies.

“The additional capital will enable Swvl to continue to create significant value for all stakeholders.” Swvl remains uniquely positioned, technologically, financially, and operationally, to capitalize on this tremendous market opportunity,” she said.

The investment terms are substantially similar to those announced in July in conjunction with Swvl’s proposed business combination transaction with Queen’s Gambit. The additional investment brings the total expected PIPE proceeds to US$121.5 million, providing additional capital to Swvl’s expansion efforts and further investments in its proprietary technology platform.