Owner of the JustRentals and JustProperty sites to become 'cornerstone' of a property listings business that is set to receive $25 million worth of investment.
Owners of JustRentals and JustProperty sell ‘significant’ minority stake to iMENA Group
The owners of the JRD Group, the parent of the JustRentals.com and JustProperty.com portals in Dubai, have sold a “significant” minority stake in their business to the iMENA Group, which is headquartered in the UAE.
Alex Nicholas and Siddharth Singh, former Accenture executives from Britain who moved to Dubai in 2008 to launch their online property portals business, intend to use the sale proceeds to grow the business across the Middle East. They also plan to sell a customer relationship management (CRM) system that manages listings for estate agents to a worldwide market.
Neither the JRD Group nor the iMENA Group would reveal the size of the deal, but Khaldoon Tabaza, Imena Group’s chairman, said it was planning to make the JRD Group “the cornerstone of our real estate classified and marketplace business”.
“Over the next two years, we expect to invest US$25 million in online real estate,” he said.
Mr Tabaza and Adey Salamin, the iMENA Group’s chief executive, set up the company three years ago to build a number of online classified and marketplace portals across the region. Mr Tabaza had founded and ran Riyada Ventures, a venture capital firm, which was sold to the Abraaj Group in 2009.
The iMENA Group also owns equity in ReserveOut, a smartphone app for reserving restaurant bookings; Easy Taxi, a taxi booking app popular in Saudi Arabia; and a majority stake in Arabsooq.com, which Mr Tabaza said was the biggest Arabic-language online marketplace site in countries across the region, including Saudi Arabia, Jordan and Kuwait.
Mr Tabaza said that few businesses had emerged as leaders in the online space across the region, but that he believed that having a group of operating companies with different apps and technologies would allow a business like JRD Group to achieve a much bigger scale than it would as a standalone player. He added that iMENA’s investment would “facilitate exit opportunities and capital appreciation”.
Mr Nicholas said the iMENA Group made the initial approach for the deal.
“We have bootstrapped this business and reinvested everything we’ve made from it. We were quite happy with the growth we’d achieved, but when we started to get approaches we realised we could grow much faster,” he said.
The JRD Group gets about 1 million visits to its property sites from users every month. It launched its first portal outside of the UAE for the Qatar market last week, and recently hired a sales executive to launch a site for Saudi Arabia. The company is also planning to attend conferences in the United States and London to begin international sales of PropSpace, which it says is used by 70 per cent of all brokers in the UAE and by more than 95 per cent of the users of CRM systems.
The market for venture capital investment into local technology businesses is relatively underdeveloped, said Declan Hayes, the managing director of Deloitte Corporate Finance in Dubai.
“As a sector, technology is not currently as popular for investors as sectors such as retail, education or healthcare,” he said. “That said, we have seen large international investors participating in funding rounds of some of the more established regional online platforms.”
In June, Bloomberg reported that souq.com in Dubai had raised $150m as part of its latest round of funding from Tiger Global Management in the US.
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