Tiger Global Management buys Cobone website as Dubai Internet start-ups attract attention of global capital again
From http://www.arabianmoney.net/private-equity/2013/03/11/tiger-asset-management-buys-cobone-website-as-dubai-internet-start-ups-attract-attention-of-global-capital-again/
Tiger Global Management has aquired the successful Dubai-based global daily deal website Cobone for an undisclosed sum as local Internet start-ups again attract the attention of global capitalists interested in the huge return-on-investment that they can deliver.
Previous examples of investment in local Internet companies include the major stake bought by HSBC Private Equity in 2005 in AME Info and sold 15 months later as part of the $27 million sale to Emap plc of the UK. In 2009 Yahoo! bought the Dubai-based email and chat website and portal Maktoob for an estimated $75-80 million.
Capital injection
The latest deal will bring Cobone additional capital to fund expansion. Founder and CEO, Irish entrepreneur Paul Kenny will stay running the show along with other key members of Cobone’s team including Warrick Godfrey, Pieter Sleeboom, Tahira Khan and Loai Ayoub.
The objective is to achieve greater market share and regional expansion. No details of the deal were published, neither the amount paid nor anything about the incentives to keep the team onboard.
Cobone was founded in August 2010 by Mr. Kenny with backing from the Jabbar Internet Group, and quickly moved to become the Middle East’s leading group buying site. It is one of few daily deal sites to possess the potential to compete on a global level in a highly competitive market.
As the largest deal site in the Middle East region, Cobone has grown its registered user base to more than two million customers, who it says have saved nearly $100 million through the more than 1.5 million coupons sold.
Exciting future
‘This deal represents a very exciting future for Cobone as it reaffirms its commitment to the Middle Eastern market and e-commerce industry,” said Mr. Kenny. “Tiger Global gives us the international clout and the financial resources to expand regionally and surpass already high customer expectations. Loyal Cobone users can look forward to many exciting developments and innovative offerings in the very near future.’
Jabbar Internet chairman Samih Toukan said: ‘The deal represents the international recognition of a highly successful local business. With Paul Kenny, we created a company that lead the way in regional group buying, and took on global players on our own turf. While this deal represents a successful exit for the Jabbar Group, we have little doubt in Cobone’s commitment to the region and in Paul’s determination to continue excelling and leading his brainchild to new successes.’
Who will be next to attract the attention of global investors like Tiger Global Management? The Cobone deal shows that the Internet is alive and well as a business platform in the region and could produce successful businesses even in the depressed business environment that followed the Dubai real estate crash.
Of course such successes are the exception and not the rule, and you do have to wonder why Cobone is selling out now.
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