PM — We’re not getting another long weekend

Happy hump day, friends. It’s a relatively busy news day here on the home front, with that M&A boomlet we signposted this morning still keeping up pace.

PSA- We’re not getting (yet another) long weekend: Saturday will be a national holiday in observance of the 23 July Revolution, a statement by the Cabinet read. Both the public and private sector will be off, the statement said. Saturday is typically already a day off for many private sector workers, but the government will not push up the revolution observance day to Thursday, as is sometimes the case.

THE BIG STORIES TODAY

Is SODIC’s bid to acquire MNHD’s hitting a dead end? SODIC said it will not revise the price it offered to acquire up to 100% of Madinet Nasr Housing and Development (MNHD) without conducting due diligence on the company in a disclosure to the EGX (pdf). This comes a few days after MNHD’s board of directors said the price was too low as it stands, and recommended that the general assembly reject SODIC’s request for due diligence during its scheduled meeting on 16 August unless SODIC bumps its offer price in a new bid.

One step closer to Chimera’s acquisition of Beltone: Chimera Investments’ bid to acquire up to 90% of Beltone Financial is poised to go through after getting the the Financial Regulatory Authority’s (FRA) stamp of approval in a disclosure to the EGX (pdf) yesterday.

THE BIG STORY ABROAD

The international business press is largely preoccupied this afternoon with the possibility of Europe waving goodbye to its era of negative rates following the European Central Bank’s monetary policy meeting this Thursday. The policy committee is expected to discuss potentially raising rates by 50 bps in a bid to tamp down soaring inflation and debt costs, while the eurozone also faces a stronger USD that has now reached parity with the EUR. The story is getting play in the Financial Times and Reuters, among others.

HAPPENING NOW-

The state’s national dialogue meetings resume: The board overseeing the Sisi administration’s national dialogue is holding its second meeting to set a schedule of debate, discuss the agenda, and form subcommittees.

Need a refresher on the national dialogue? We’ve got you covered.

The government’s public consultations on its state ownership policy are also continuing today with representatives from the wholesale and retail sectors having their say. Sunday’s session brought leather manufacturers together to discuss the state’s privatization plans. Every Sunday, Tuesday and Thursday sees workshops on how privatization plans will affect specific industries. You can find more details on the schedule of the meetings here.

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** CATCH UP QUICK on the top stories from today’s EnterpriseAM:

• Infinity + AFC just sealed Africa’s largest-ever renewables acquisition: Our friends at renewables player Infinity Group and Africa Finance Corporation (AFC) have signed an agreement to acquire 100% of Lekela Power in what is Africa’s largest renewables acquisition.
• Banque du Caire’s IPO may have been kicked down the road once more: State-owned Banque du Caire is postponing its long-awaited IPO due to unfavorable market conditions.
• SDX shareholder to block planned merger with Tenaz: A planned merger between UK-based, Egypt-focused SDX Energy with Canadian firm Tenaz Energy has been thrown into doubt after a group of shareholders said they would vote to block the transaction.

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???? CIRCLE YOUR CALENDAR-

IDG to host cultural festival with sustainable waste in focus at Alamein: Our friends at Industrial Development Group (IDG) are hosting a cultural festival at their eco-sustainable industrial park, e2 Alamein, on the North Coast, according to a statement (pdf). The “Locale” festival, which IDG is hosting in partnership with Art d’Egypte, will include showcase nine art installations made with recycled materials to raise “awareness around waste management and

encouraging waste prevention, reuse, and recycling behavior.” The event launches this Thursday, 21 July, and runs through the summer.

Calling tech startups: Universities of Canada in Egypt-based incubator DMZ Cairo has opened applications for its second eight-month incubation program for tech startups, which begins in November, according to a statement (pdf). The incubator — which is backed by the Academy of Scientific Research and Technology and the National Technological Incubators Program — is accepting applications for the cycle until 29 September.

☀️ TOMORROW’S WEATHER- The mercury is set to rise (although not significantly) tomorrow, reaching a high of 38°C before cooling to a low of 25°C in the evening.

Think you’re booking a hotel that’s an eco-tourism spot? Look more closely. Many hotels are advertising their supposed “net-zero” status, but their carbon footprint is bigger than you’d think, Bloomberg reports. When boasting about their shunning of plastic bottles and how they use renewable energy or reusable water, some hotels fail to disclose the impact of their embodied carbon — a term that refers to the harmful gasses emitting during construction of any building, citing architects and research scientists. So these eco-efficient mechanical systems in that five-star hotel? They were responsible for large amounts of emissions during their manufacturing, transportation, and installation. Embodied carbon in construction contributes to at least 21% of global emissions, according to Brightworks Sustainability. A main problem lies in the fact that there is no actual regulation or an agreed-upon definition of what it means to be net-zero, leaving things loosely open to interpretation. And many tourists care, according to the Sustainable Travel Report 2022 released by Booking.com, which found that 81% of people consider sustainability a crucial factor when determining how to travel.

The ironic vicious cycle of personal finance management: Rising stress about money management and savings is causing some people to lose control of their finances — including something as small as forgetting to pay bills, which ironically increases their financial burdens thanks to late-payment fees, the Wall Street Journal reports. During the first six months of the year, JPMorgan Chase said 1.05% of its credit-card customers were one month late on making their payments, which was slightly up from 1.01% during the same period last year. More people are behind on their auto loans and utility payments as well, according to figures cited by the Journal. Forgetting was listed as the top reason people are missing out their credit-card payments this year, followed by financial shortcomings, according to a recent survey by WalletHub.

There’s a lot to be stressing about, when it comes to finances: Inflation, covid-19, and stock market turbulence are the main causes of money-related stress, according to financial advisors. “Clients are carrying a heavier mental load these days, built up in part by what feels like 50 years’ worth of events happening in a single week. No wonder they’re distracted,” said financial planner Kelly Klingaman.

???? ON THE TUBE TONIGHT-
(all times CLT)

A mistaken identity action-comedy makes for easy viewing in The Man from Toronto: The movie follows a failed New York salesman (Kevin Hart) whose identity is mistaken with a notoriously-deadly assassin (Woody Harrelson), and the ensuing hilarity is what kept us watching. How does the faux-pas happen? An Airbnb mix up, after Teddy’s printer rendered the rental’s address unreadable. With two likable actors in the leading roles, the movie is perfect for non-complicated viewing after a long day. Fun fact: The movie was inspired by real events — producer Jason Blumenthal got inspiration for the film after experiencing a (far-less deadly) Airbnb mix-up himself.

⚽ No football today, good people.

????EAT THIS TONIGHT-

Pick up breakfast from the long-reigning king of bagels — Jared’s Bagels in Maadi: It’s not easy to find a good bagel in Cairo, but Jared’s Bagels brings one of the best doughnut-shaped yeast-leavened rolls we’ve ever had. With just the right amount of fluffiness, it almost feels like you picked them up from a New York City deli — even our former NYC-dwellers were impressed. We recommend their smoked salmon and cream cheese bagels, and you can’t go wrong with their egg omelet, turkey and cheddar bagel for breakfast (or lunch… or dinner). Their coffee is pretty good as well, and their staff are always super friendly, which makes for an overall wonderful foodie experience.

???? OUT AND ABOUT-
(all times CLT)

Beat the post-vacation blues at Cairo Jazz Club 610’s #TuesdayMidweekParty tonight: Dance the night away with a masterful melodic and deep house set from Heavy Pins at 8pm, followed by Mohasseb’s signature beats.

If you’re heading up to Sahel this weekend, catch John Legend’s concert at the Playa resort on Friday at 5pm. The concert will be the first performance in Egypt for the singer — who has the highly-coveted EGOT status from earning an Emmy, Grammy, Oscar, and and Tony awards.Tickets are available through Ticket Egypt here.

???? UNDER THE LAMPLIGHT-

Two video game developers look for love IRL in Tomorrow, and Tomorrow, and Tomorrow: When Sam and Sadie first met as teenagers in a hospital, they immediately bonded over their shared love of gaming. Years later, the duo are reunited in Boston — when Sam goes to Harvard and Sadie attends MIT — and they collaborate on creating a video game that launches them into the gaming industry. But make no mistake, while this new novel by Gabrielle Zevin centers around game designers and love, it has very little to do with gaming and romance. It is, however, about the complexities of what it means to be human, and the relationships, friendships, and connections that can bring joy through a digital world, away from the messiness of the real world.

The EGX30 rose 1.9% at today’s close on turnover of EGP 1.2 bn (31.7% above the 90-day average). Local investors were net buyers. The index is down 24.4% YTD.

In the green: CIRA (+10.3%), Orascom Development Egypt (+4.8%) and GB Auto (+4.4%).

In the red: Cleopatra Hospitals (-5.1%), Madinet Nasr Housing (-3.5%) and Sidi Kerir Petrochemicals (-1.0%).

OUR FOUNDER OF THE WEEK- Ahmed Wagueeh, co-founder and CTO of Khazna (LinkedIn).

My name is Ahmed Wagueeh, and I’m the chief technology officer and co-founder of Khazna. I studied computer engineering at Cairo University, and prior to co-founding Khazna, I worked with multinational corporations like Intel, Valeo, and IBM.

Khazna, launched in 2019, targets the middle and lower economic classes of the Egyptian population. Khazna caters to around 53% of Egyptians who are underbanked and lack access to formal financial services. The branch-based model, given its high costs, does not adequately serve the needs of low-income segments of the population, and we aim to tackle this problem. Khazna currently offers general purpose credit, buy now, pay later (BNPL), and bill payment services.

The fact that Egypt has the highest number of smartphone users in the region opened our eyes to the potential of our business model. We knew we could provide financial services digitally to our users and provide them with a platform that integrates them within the formal financial system.

Providing a seamless user experience is a top priority for us; everything you need is just 2 or 3 clicks away, without lengthy processes that bore users. We also focus on providing top-notch customer support and onboarding processes.

The most important KPIs we focus on include our outstanding loan book, which enables us to track the number of loans and services utilized by our users. Increasing numbers are indicative of the fact that current users are utilizing more of our services, which would in turn mean that we are acquiring more users through referrals. We also focus on the number of our monthly active users; these are the northstars that guide us on a weekly basis.

Our customer acquisition strategy is twofold: We partner with employers to validate the data and credit score of their employees, so we can establish a logical, multipurpose credit line based on the information provided to us. Users can utilize their credit line in several ways, whether it be withdrawing funds in cash or using it for BNPL services through any one of the top 100 merchants we partner with, or for bill payment services. We also acquire users through traditional marketing channels.

We also recently acquired a license to issue a card of our own, Khazna Card. We were the first fintech app in Egypt that launched such an offering. Khazna card, a Meeza prepaid card launched in partnership with the Abu Dhabi Islamic Bank (ADIB), provides our unbanked users access to a wide range of financial services. It also enables us to facilitate a unique service: instant disbursement of cashflow through our app, regardless of banks’ working days and national holidays.

So far Khazna raised a total of USD 47 mn. We raised USD 9 mn during our seed and pre-seed rounds. The main investors for these two initial rounds were Algebra Ventures and Accion Venture Lab. We raised USD 38 mn in equity and debt during our series A round, with the equity investment led by Quona Capital with the participation of Speedinvest, Nclude, Khawarizmi Ventures, Algebra Ventures, Accion Venture Lab, Disruptech, AB Accelerator by Arab Bank, and CVentures, among others. The debt financing was backed by Lendable.

Being backed by Nclude was historic for us. The fact that top tier banks are backing us, a fintech startup, is a testament to our impact and gave us an enormous boost of confidence. It is a milestone for us, because we became even closer to regulators and the formal banking sector.

I think bootstrapping your startup entirely can be problematic. You need investors to challenge you, and validate your business model and approach. Bootstrapping can create an echo chamber that isolates you from opposing views, and can leave you unprepared for the challenges you’ll face in the real world, ultimately compromising your survival.

If I had to do it all over again, I would still partner with investors. We always partner with VCs that have similar startups in their portfolio because they can help us grow and navigate challenges. I believe that bringing in the right partners accelerates the business on so many levels. Investors obviously bring capital to the table, but they also bring strategic advice, market insights, help you form meaningful connections with startups that face similar challenges, and can help you expand into new markets.

The best part of the job is seeing our hard work come to fruition: Reaching 1 mn transactions, and getting the approval to launch our Khazna card were both milestones that made us equally ecstatic and proud. Apart from milestones, I truly love my job; I’ve been passionate about software development since I was eight years old, so I consider my job a hobby and a passion project. The fact that our business is impactful and helps better the lives of our users is truly fulfilling.

In another life, I would have been a film critic. I’m a complete movie buff. Movies like Fight Club, Pulp Fiction, and The Green Mile are outstanding and I never get bored of them, even after watching them for the 30th time [laughs]. I’m a sucker for great dialogue and captivating stories.

The last great thing I watched was House. The series is mesmerizing; it captures the brilliance and madness of the antisocial protagonist, Dr. Gregory House, who is played by Hugh Laurie, and is rife with brilliant dialogue and plot twists.