For venture capital firms, successful exits aren’t just the end goal—they’re the foundation upon which the entire investment thesis should be built. Yet many GPs approach exit planning as an afterthought, scrambling to find liquidity paths only when their fund lifecycle demands it.
The GP Exit Canvas offers a systematic approach to embedding exit strategy thinking from day one of the investment process.
Why Exit Strategy Matters From The Start
Traditional VC wisdom focuses heavily on picking winners and adding value post-investment. While these remain crucial, the most successful funds think backward from the exit. They understand that even the most promising startup with exceptional growth means nothing to LPs if there’s no clear path to liquidity.
The GP Exit Canvas provides a structured visual framework for integrating exit planning throughout the investment lifecycle, from initial due diligence through successful transaction completion.
GP Exit Canvas. Chris Rangen, 2024
The GP Exit Canvas is built around nine key building blocks:
To illustrate how the GP Exit Canvas works in practice, let’s follow Kilimanjaro Ventures, a fictional $50M early-stage VC fund based in Nairobi. Founded in 2023, the fund focuses on fintech, agritech, and healthtech startups across East Africa, with check sizes ranging from $500K to $2M.
Let’s walk through each of the nine elements of the canvas and see how Kilimanjaro Ventures applies these principles.
1. Pre-Deal Assessment: Building Exit Thinking Into Due Diligence
The GP Exit Canvas: Before writing a check, assess the realistic exit pathways and timeline for each potential investment.
Kilimanjaro’s Approach: When evaluating FlexiPay, a Kenyan mobile payments startup, Kilimanjaro’s team doesn’t just analyze the market opportunity and founding team. They specifically research the exit landscape. They identify that Safaricom has acquired three fintech companies in the past four years, that PayPal has established a $200M Africa M&A strategy, and that two similar startups achieved successful exits to regional banks within 18-24 months.
This analysis reveals multiple potential exit paths: strategic acquisition by telecom operators, acquisition by international payment companies expanding into Africa, or acquisition by regional financial institutions. The team also notes that the 4-6 year exit timeline aligns well with their fund’s seven-year lifecycle.
Most importantly, they identify potential red flags: regulatory uncertainty around mobile payments and the fact that most successful exits in this space required companies to achieve profitability first.
2. Key Documents: The Foundation Of Future Exits
The GP Exit Canvas: Structure legal documents, governance, and strategic partnerships to facilitate rather than hinder future exits.
Kilimanjaro’s Approach: Drawing from their pre-deal assessment, Kilimanjaro structures their FlexiPay investment with exit optimization in mind. They negotiate liquidation preferences that provide downside protection while ensuring founder alignment with exit goals. Their board composition includes industry connections who could facilitate strategic introductions.
Critically, they establish a tiered exit model in their investment documents. If FlexiPay achieves certain revenue milestones, Kilimanjaro commits to actively facilitate introductions to their network of potential acquirers. This creates alignment between growth goals and exit preparation.
They also ensure that their shareholder agreement includes tag-along rights and defines the process for board approval of exit opportunities, streamlining future transaction processes.
3. Exit Strategy BOD Day: Annual Strategic Planning
The GP Exit Canvas: Dedicate specific board meetings annually to exit strategy planning and preparation.
Kilimanjaro’s Approach: Every January, Kilimanjaro hosts “Exit Strategy Board Days” for each portfolio company. For FlexiPay, this means bringing together the founding team, board members, and invited industry experts to assess exit readiness.
During FlexiPay’s 2025 Exit Strategy BOD Day, they review the competitive landscape, assess which strategic buyers have been most active, and identify gaps in the company’s exit readiness. They discover that while FlexiPay has strong user growth, their compliance documentation isn’t ready for institutional buyer due diligence.
The session results in a concrete 90-day plan: hire a compliance officer, complete SOC 2 certification, and document all regulatory approvals. Kilimanjaro commits to introducing FlexiPay to their network contact at PwC for the compliance work.
4. Mapped Out Exit Paths: Multiple Scenarios, Multiple Timelines
The GP Exit Canvas: Identify and actively develop multiple potential exit pathways rather than betting on a single outcome.
Kilimanjaro’s Approach: For FlexiPay, they map out four distinct exit paths:
Strategic Acquisition by Safaricom (18-month timeline): Leveraging their board member’s previous relationship with Safaricom’s corp dev team
Acquisition by International Player (24-month timeline): PayPal, Mastercard, or Stripe expanding African operations
Regional Bank Acquisition (12-18 month timeline): Equity Bank or KCB Bank seeking fintech capabilities
Secondary Sale to Later-Stage Fund (30-month timeline): Selling to TLcom Capital or Partech for their Series B
Each path has different preparation requirements, timelines, and valuation expectations. By maintaining multiple paths, Kilimanjaro ensures they’re not dependent on a single buyer’s strategic priorities.
5. Exit Dealmaking: Execution Excellence
The GP Exit Canvas: Develop repeatable processes and expertise for managing exit transactions.
Kilimanjaro’s Approach: When FlexiPay begins attracting acquisition interest from Equity Bank, Kilimanjaro’s systematic approach pays dividends. They’ve already established relationships with three investment banks that specialize in African fintech transactions.
Their exit dealmaking process includes standardized data room preparation (they maintain updated investor materials quarterly), a clear communication protocol with founders about managing buyer relationships, and predetermined negotiation priorities.
Most importantly, because they mapped out multiple exit paths, when Equity Bank’s initial offer comes in below expectations, they can credibly reference their ongoing conversations with Visa’s Africa team to negotiate better terms.
6. Exit Advisors: Building The Right Support Network
The GP Exit Canvas: Cultivate relationships with investment bankers, lawyers, and other advisors before you need them.
Kilimanjaro’s Approach: Kilimanjaro maintains active relationships with three investment banks focused on African tech (including Afreximbank and Standard Investment Bank), two law firms specializing in M&A transactions, and accounting firms experienced in venture-backed company exits.
For FlexiPay, they engage Bowmans Law as transaction counsel early in the process. Because they’ve worked with Bowmans on two previous exits, the legal team already understands Kilimanjaro’s standard positions on key deal terms, accelerating the transaction timeline.
They also leverage their relationship with KPMG for buy-side financial due diligence support, helping Equity Bank move quickly through their analysis.
7. GP Exit Team: Internal Capabilities And Expertise
The GP Exit Canvas: Build internal team capabilities for managing exits, rather than outsourcing all exit expertise.
Kilimanjaro’s Approach: Kilimanjaro’s four-person team includes Sarah Mwangi, a partner who previously led corp dev at Safaricom. Sarah leads all exit processes and maintains relationships with strategic buyers across their target sectors.
The team also includes James Ochieng, who handles all legal and financial aspects of transactions. This internal expertise means they can move quickly when opportunities arise and provide sophisticated guidance to founders throughout the process.
For FlexiPay’s exit, Sarah leverages her network to arrange informal conversations with three potential buyers before launching a formal process, helping gauge market interest and refine their approach.
8. Exit Network: Ecosystem Relationships
The GP Exit Canvas: Systematically build relationships with potential acquirors, co-investors, and industry players.
Kilimanjaro’s Approach: Kilimanjaro treats network building as a core fund activity. They host quarterly “Africa Fintech Roundtables” bringing together portfolio companies, potential strategic buyers, and other investors.
These events serve multiple purposes: they provide value to portfolio companies through industry connections, they keep Kilimanjaro top-of-mind with potential acquirers, and they create deal flow for future investments.
When FlexiPay’s exit opportunity emerges, Kilimanjaro can quickly activate relationships with five potential buyers, creating competitive tension that drives valuation.
9. Exit Committee: Governance And Decision-Making
The GP Exit Canvas: Establish clear governance processes for making exit decisions and managing founder relationships.
Kilimanjaro’s Approach: Kilimanjaro’s exit committee includes both fund partners plus their LP advisory board representative from Development Bank of Southern Africa. This structure ensures alignment between the fund’s exit decisions and LP expectations.
For FlexiPay, when multiple exit opportunities emerge simultaneously, the exit committee provides a structured process for evaluating options. They use a weighted scoring matrix considering valuation, strategic fit, transaction certainty, and timeline.
The committee also manages the delicate founder relationship during the exit process, ensuring that FlexiPay’s founders remain focused on business operations while exit discussions proceed.
KV GP team celebrating the exit to Equity Bank
The Results: Strategic Success
Four years after investment, FlexiPay successfully exits to Equity Bank for $12M, representing a 6x return for Kilimanjaro Ventures. But the real success lies in the process: because they planned systematically from day one, they managed a competitive process that took only four months from initial interest to closing.
Key Lessons For GP Teams
The GP Exit Canvas reveals several critical insights for venture capital firms:
Exit planning isn’t separate from investment strategy—it is investment strategy. The most successful VCs think backward from liquidity events when making investment decisions.
Systematic beats sporadic. Funds that build repeatable processes for exit planning consistently outperform those that approach each exit as a unique event.
Relationships matter more than financial engineering. The most valuable exits come from authentic relationships with strategic buyers built over years, not months.
Multiple paths create optionality. Funds that develop multiple exit scenarios for each investment can optimize timing and valuation when opportunities arise.
Internal capabilities accelerate external opportunities. Building exit expertise within the fund team pays dividends across the entire portfolio.
Implementing The Canvas
For GPs looking to implement the Exit Canvas approach, start with your next investment decision. Before you commit capital, work through each element of the canvas. Identify potential exit paths, map out required relationships, and build exit considerations into your investment structure.
The goal isn’t to predict exactly how each investment will exit—it’s to ensure you’ve created the conditions for successful exits when opportunities arise.
The most successful venture capital firms don’t just pick winners; they systematically create the conditions for winning exits. The GP Exit Canvas provides the framework for building that systematic approach into every aspect of your fund’s operations.
In the rapidly evolving venture landscape, LPs increasingly evaluate GPs not just on their ability to identify promising startups, but on their track record of creating successful liquidity events. The GP Exit Canvas ensures that exit strategy thinking becomes a core competency, not an afterthought.
For emerging market funds like our fictional Kilimanjaro Ventures, this systematic approach becomes even more critical. With smaller pools of potential acquirers and less developed exit markets, the discipline of the GP Exit Canvas can mean the difference between a successful fund and one that struggles to return capital to LPs.
The canvas works because it transforms exit planning from a discrete event into an ongoing strategic capability. And in venture capital, capabilities compound over time into competitive advantages that drive superior returns for LPs and successful outcomes for entrepreneurs.
Read also Part II: How Fund Managers Can Use the GP Exit Canvas (part II)
A big thanks to Rosanne Whalley, AHL Ventures and Daniel Keiper-Knorr, Speedinvest for the conversations and webinars that led to the development of the GP Exit Canvas.
https://i2.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1749158682251.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2025-07-04 13:48:002026-05-01 13:49:50The GP Exit Canvas (I): Strategic Exit Planning For Venture Capital Firms: The Story Of Kilimanjaro Ventures
The GP Exit Canvas isn’t a one-size-fits-all solution—it’s a flexible, visual framework that adapts to different fund strategies, geographies, and market conditions. Here’s how fund managers across various contexts can implement the GP Exit Canvas for successful exits.
Part I: The GP Exit Canvas: Strategic Exit Planning for Venture Capital Firms: the story of Kilimanjaro Ventures (read part I first)
The GP Exit Canvas, Chris Rangen, 2024
For Early-Stage Funds
Micro VCs and Pre-Seed Funds: Your exit timelines are longer, but your influence on exit preparation is often highest. Use the Pre-Deal Assessment to identify companies with clear paths to Series A funding and beyond. Focus your Key Documents section on ensuring clean cap tables and founder-friendly terms that won’t complicate future fundraising. Your Exit Network should emphasize relationships with later-stage VCs who could provide secondary liquidity.
Series A Funds: You have the sweet spot of influence and timeline alignment. Your Exit Strategy BOD Days should focus heavily on building enterprise value and market position. Use Mapped Out Exit Paths to balance strategic acquisition possibilities with IPO preparation for your highest-potential investments. Your Exit Team should include someone with public company experience.
For Growth And Late-Stage Funds
Growth Equity Funds: Your exit timelines are compressed, making the Exit Committee and Exit Dealmaking components critical. Focus on companies that are already demonstrating clear paths to profitability and have addressed major scaling challenges. Your Exit Advisors network should include investment banks with strong sector expertise and track records in your target exit size range.
Pre-IPO Funds: The canvas becomes a checklist for public market readiness. Your Exit Strategy BOD Days should simulate board meetings of public companies. Exit Advisors should include auditors, underwriters, and public company executives. Your Exit Network needs to include institutional investors and research analysts.
For Sector-Specific Funds
Healthcare and Biotech Funds: Your Pre-Deal Assessment must include regulatory pathway analysis and IP landscape mapping. Exit paths typically center on strategic acquisitions by pharma companies or medical device manufacturers. Your Exit Network should include corporate development professionals at target acquirers, and your Exit Team needs regulatory expertise.
Enterprise Software Funds: Focus on recurring revenue quality and customer concentration in your Pre-Deal Assessment. Your Exit paths often include both strategic acquisition by larger software companies and potential public offerings. Exit Strategy BOD Days should emphasize metrics that matter to both strategic and financial buyers.
Climate and Impact Funds: Your exit considerations must balance financial returns with mission alignment. Use the Exit Committee to establish clear frameworks for evaluating offers that might compromise impact goals. Your Exit Network should include impact-focused strategics and values-aligned acquirers.
For Geographic-Specific Applications
Emerging Market Funds: Like Kilimanjaro Ventures, your Exit Network building becomes even more critical due to smaller pools of potential acquirers. Focus heavily on relationships with international strategics expanding into your markets. Your Exit Committee should include advisors with cross-border transaction experience.
European Funds: Leverage the strong M&A market and multiple exit jurisdictions. Your Mapped Out Exit Paths should consider both local and pan-European strategic buyers. Post-Brexit, include regulatory considerations in your Key Documents planning.
Asian Funds: Consider the unique exit landscape including strong strategic buyer appetite and active public markets. Your Exit Network should span both regional and international players, and your Exit Team should understand local market dynamics.
For Different Fund Sizes
$10-50M Funds: Focus on building repeatable processes that don’t require large teams. Your Exit Team might be just one partner, but ensure they have strong external advisor relationships. Use the Exit Network strategically—you can’t cover every potential buyer, so focus on the most active acquirers in your sectors.
$100M+ Funds: You can afford specialized roles and sophisticated exit planning. Consider dedicated exit partners or principals. Your Exit Advisors can include multiple investment banks for different transaction sizes. Use your scale to host larger industry events that bring together multiple potential acquirers.
$500M+ Mega Funds: Your exit planning needs to consider market impact and public market readiness for your largest positions. Your Exit Committee should include public market investors. Consider hiring former investment bankers or corporate development executives full-time.
Customization Guidelines
Adapt the Timeline: Early-stage funds might plan 7-10 year exit horizons, while growth funds might focus on 2-4 years. Adjust your Exit Strategy BOD Day frequency and urgency accordingly.
Scale the Network: Smaller funds should focus on deeper relationships with fewer potential acquirers. Larger funds can cast wider nets but need systems to manage relationships systematically.
Modify the Documentation: Your Key Documents section should reflect your typical deal terms and structures. Growth equity deals have different exit consideration than seed investments.
Adjust Committee Structure: Solo GPs might have external advisors serve exit committee roles. Large funds might have dedicated exit committees for different portfolio segments.
Implementation Roadmap
Month 1: Complete Pre-Deal Assessment for your three most promising current investments. Identify gaps in your exit knowledge and planning.
Month 2: Audit your Key Documents across the portfolio. Identify any structural impediments to future exits and plan to address them.
Month 3: Schedule Exit Strategy BOD Days for your top five investments over the next six months.
Month 4: Map out detailed exit paths for your most mature investments. Begin building target acquirer relationships.
Month 5: Establish relationships with 2-3 investment banks and transaction attorneys in your focus areas.
Month 6: Formalize your internal Exit Team roles and external Exit Committee structure.
The key to successful implementation is starting small and building systematically. Choose one element of the canvas to focus on each quarter, rather than trying to implement everything simultaneously. The canvas works best when it becomes integrated into your fund’s standard operating procedures, not treated as a separate project.
Remember that the GP Exit Canvas isn’t about predicting the future—it’s about creating the conditions for successful exits when opportunities arise. By building these capabilities systematically, fund managers can transform exit planning from a reactive scramble into a proactive competitive advantage.
Key Lessons For GP Teams
The GP Exit Canvas reveals several critical insights for venture capital firms:
Exit planning isn’t separate from investment strategy—it is investment strategy. The most successful VCs think backward from liquidity events when making investment decisions.
Systematic beats sporadic. Funds that build repeatable processes for exit planning consistently outperform those that approach each exit as a unique event.
Relationships matter more than financial engineering. The most valuable exits come from authentic relationships with strategic buyers built over years, not months.
Multiple paths create optionality. Funds that develop multiple exit scenarios for each investment can optimize timing and valuation when opportunities arise.
Internal capabilities accelerate external opportunities. Building exit expertise within the fund team pays dividends across the entire portfolio.
Implementing The Canvas
For GPs looking to implement the Exit Canvas approach, start with your next investment decision. Before you commit capital, work through each element of the canvas. Identify potential exit paths, map out required relationships, and build exit considerations into your investment structure.
The goal isn’t to predict exactly how each investment will exit—it’s to ensure you’ve created the conditions for successful exits when opportunities arise.
The most successful venture capital firms don’t just pick winners; they systematically create the conditions for winning exits. The GP Exit Canvas provides the framework for building that systematic approach into every aspect of your fund’s operations.
In the rapidly evolving venture landscape, LPs increasingly evaluate GPs not just on their ability to identify promising startups, but on their track record of creating successful liquidity events. The GP Exit Canvas ensures that exit strategy thinking becomes a core competency, not an afterthought.
For emerging market funds like our fictional Kilimanjaro Ventures (read the post), this systematic approach becomes even more critical. With smaller pools of potential acquirers and less developed exit markets, the discipline of the GP Exit Canvas can mean the difference between a successful fund and one that struggles to return capital to LPs.
The framework works because it transforms exit planning from a discrete event into an ongoing strategic capability. And in venture capital, capabilities compound over time into competitive advantages that drive superior returns for LPs and successful outcomes for entrepreneurs.
Read also part I: the story of Kilimanjaro Ventures.
https://i0.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1749159597996.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2025-07-04 13:40:002026-05-01 13:51:28How Fund Managers Can Use The GP Exit Canvas (Part II)
VC ecosystems around the world are maturing at different pace, each with its own set of challenges and dynamics. But the views articulated in The great Mavcap misfire (Emmanuel Samarathisa) come across as both flawed and based on the wrong underlying assumptions on how an emerging VC ecosystem actually works.
Here are my quick thoughts in response.
The Malaysian Context
Malaysia, like many other developing countries around the world has recognized the importance of shifting from a agriculture- and manufacturing economy and increasingly to a professional services and innovation-powered economy. By extension, this also means supporting and scaling startups, hopefully seeing them mature into major scale ups and eventually pillars of the national economy.
But, ever since these conversations started, Malaysia has lagged behind regional innovation hubs, with Singapore being the leading player. To deal with the growth challenges, several Malaysian governments have launched various initiatives to support the growth and development of the Malaysian startup scene, including:
– Multimedia Super Corridor (MSC)
– Klang Valley region – the Silicon Valley of Kuala Lumper (a vast stretch target)
– MavCap & Cradle Fund
– MDEC
– The formation of MaGIC – Malaysian Global Innovation & Creativity Center
– KL20
– Malaysia Venture Capital Roadmap (MVCR)- with a goal to increase VC penetration rate to 0.25%-0.35% of GDP by 2030
(For full transparency, the author was a strategic advisor to MaGIC back in 2016-2019)
From Startups To Capital
Against this backdrop, we then need to examine the maturity of the venture financing ecosystem – and this is where the Malaysianist and the piece The great Mavcap misfire might be missing a few key points.
Transparency In The Market
In researching the article, the author has been able to access documents showing fund-level returns, based on Mavcap data. This is excellent and should be applauded. We recommend all government linked fund-of-funds to be openly sharing fund performance data on a regular basis. Kudos to the author for getting hands on and sharing the data.
What’s The Mission Of A National, Government-Linked Fund-Of-Funds?
MavCap (now, Jelawang), like any national fund-of-fund has a three-way mission.
1. Develop the local VC ecosystem (see our research on VC ecosystem)
2. Invest and back local and national fund managers (often, emerging managers)
3. Secure ‘attractive’ returns from the investments
The primary purpose of a national fund-of-fund is not to attain above-market returns. If that was the primary goal, there are many better asset classes, including buying real estate in Singapore or buying a pool of US listed equities, like Apple, Microsoft and Meta.
Instead, the national fund-of-fund strategy has a broad mission to develop the market, develop the ecosystem for long-term competitiveness. On this picture, fund managers is just one small part of the equation. Available growth capital, access to Limited Partners, professional service providers and a rich menu of exit paths are all equally important pieces in the VC ecosystem’s maturity.
The VC Ecosystem: Built on 8 key pillars (Rangen, 2024)
Where Does Malaysia’s VC Ecosystem Sit?
When we work with national fund-of-funds, we often start by a basic assessment of ‘where are we today’. Using the VC Ecosystem Maturity stages, we can quickly identify where the market is today, and where it would like to evolve into in the next 5-10 years.
Scaling VC Ecosystems Canvas, Rangen, 2024
Using this framework, we would assess Malaysia to set at level 2: Build.
At level 2: build, the VC investments sits around 0,2- 0,4% of GDP. The ecosystem is young and highly immature. Private allocators are not interested, as the market has historically failed to deliver any meaningful returns. The companies don’t scale, the fund managers are still learning and the exit paths are just not there. There might be some good, local companies, but they mostly move to Singapore or Silicon Valley, due to the lack of a local ecosystem.
The biggest LP investors in this category are international finance organizations, like IFC, World Bank or national governments through a wide range of government-backed fund-of-funds. At this stage, few actually expect the fund managers to return back much, but see this as investing into the long-term capacity and maturity of the market. There might be a few outlier deals, proving the evolution, but largely, at fund-levels, most funds underperform from a pure financial return point of view.
At level 2: Build, most of the capital that comes into the market is labelled as ‘catalytic’, or development purposes, rather than seeking above-market returns.
Often, this is misunderstood by the media, who will view any fund performance through the lens of a level 4: Perform or even level 5: Outperform lens, expecting outlier returns in a market that just has not grown to this stage yet.
Interpreting The Data
Reading The great Mavcap misfire, I believe the challenge comes on the interpretation and assumption side.
Here Are A Few Quick Facts:
– Ca. 50% of all VC funds will never return back 1X net DPI
– Ca. 20% of all VC funds will return back around 1X – 2X net DPI
– Ca. 20% of all VC funds will return back 2X – 3X net DPI
– Ca. 10% of all VC funds will return back at or above 3X net DPI
– Out of those, around 2% will return back the 5X – 10X or even 200X net DPI
For anyone investing into the venture asset class for commercial returns, they would need to secure allocation to the top 10%, ideally the top 2% of funds globally. Some great thoughts from our friends at VenCap on this subject. (A wall of capital coming, VC is really hard and Return of the Power Law)
Further Facts:
– Most VC funds need 12-16 years to see a full ‘seed-to-exit’ return profile. This is a challenge if funds are set up with 8-10 year timelines. This is simply too short
– For many funds, there is a window of ca. 1-2 years, from effective exit transaction in the market, to actual pay-out (DPI) back to LPs.
– For most, there is zero correlation between year 7 data and ultimate performance
– For most, there is zero correlation between year 7 DPI and ultimate DPI
– When assessing an active fund (which, given various extensions, might be 12+ years), we always need to look at multiple indicators to get the full picture. At a minimum, this would be called capital, MOIC, TVPI and net DPI.
Table of MavCap backed funds, from The Malaysianist.
So, What Does This Mean For The Great Mavcap Misfire?
The funds that are listed in The great Mavcap misfire seem to follow a pretty average distribution range.
There are a total of 14 funds, from 2013 to 2021 vintages. Two are listed as Divested or in current dissolution process. The remaining 12 are still actively managing their portfolios. Based on the available data, we can see that the DPI sits at 0 (to be expected by younger funds), 0.07 (Superseed I, 2016) up to 2.88 (Lunex Ventures, 2018). This looks like a perfectly normal range, with some not in DPI mode yet, some on the low end (very low end) and one early winner, Lunex.
But, This Dataset Is A Highly Incomplete Dataset And Zero Conclusions Should Be Drawn From This.
The reason: MOIC and TVPI. The table shows how much capital MavCap has put in (401,9M) and how much has been paid back (108,2). But, without knowing the MOIC and notably the TVPI, it is impossible to know how these 12 funds are actually performing.
Always Track TVPI And DPI
To illustrate the importance of adding a more complete dataset, I have created three scenarios below. Base case, bull case and bear case.
The Base case assumes a pretty normal GP fund performance in a level 2: Build VC ecosystem, allowing for some investments to happen in regional funds (including Singapore) and some to happen in global funds (with a certain allocation earmarked for Malaysia).
Three Examples When Adding TVPI
BASE CASE
In the base case, I have added 800M in total value (NAV + DPI) for the fund. The 800M would represent both the value of the current assets in the underlying funds, as well as the amount that has already been paid out to LPs. Note the vintage period here runs from 2013 to 2021, but would then extend all the way to 2033, to allow the last funds to dissolve. This would give us a 20-year total timeline. In the base case below, we see the TVPI at 1,99X, which would be at a low end, but within a reasonable range for a developing VC ecosystem.
Base case, 2013-2021, assumed total value of 800M, for a 1,99X TVPI
BASE CASE: 2033 ALL FUNDS FULLY DIVESTED
In 2033, all the funds are liquidated, There would naturally be a mix of bankruptcies, write-offs, maybe some management buybacks, some secondaries with heavy discounts in order to liquidate, but the funds across the portfolio has managed to deliver back a 1,62X net DPI to its LPs. Considering the 20-year timeline, this would give us a low IRR (internal rate of return), but all told, LPS like MavCap would effectively get their money back, adjusted for inflation.
Base case, 20233, all funds divested, 1,62 DPI paid back
BULL CASE
In the bull case, we have assumed that the total value of the portfolio, including DPI is 1,8BN. This would be an aggressive mark-up vs. our base case. A 1,8BN would give us a TVPI of 4,48X.
Bull case, best case development, 1,8BN in asset value, for a 4,48X TVPI
BULL CASE: 2033 ALL FUNDS FULLY DIVESTED
By 2033, with all funds divested, the bull case would be able to pay out, in our example, a total of 980M cash-on-cash, for a 2,44X net DPI. Note the reduction from 1,8BN portfolio value to 980M in payouts. This would likely come from a heavy mark-down of assets, a willingness to take haircuts to achieve liquidity in secondary markets and finally all costs and fees for the fund managers. Still, for most LPs, a 2,44X net DPI would be pretty ok, even very strong for a national fund-of-fund with the triple mission we mentioned above.
Bull case, 20233, DPI 2,44X
BEAR CASE
Of course, the reality is that most VC funds underperform. That’s also the case in our bear case. Things just did not work out. The market did mature as expected. Most talent drifted off to Singapore. Most fund mangers were unable to find meaningful follow-on rounds. Most companies stalled and burned out. A mixture of culture, limited access to capital and weak boards led to significant write offs and mark downs. In short, it was a bloodbath in the market.
In this case, we list the assets at 250M (down from 1,8BN in the bull case). This would give the portfolio a TVPI of 0,62.
Bear case, 2033, TVPI 0,62
BEAR CASE: 2033 ALL FUNDS FULLY DIVESTED
Fast forward to 2033, bear case fully played out, the total exit value came to 200M. On an initial investment of 401,9M, this gives us a net DPI just below 0,5X. Financially, that would give us a 200M net loss. Yet, at the same time, considering the catalytic efforts to build out the VC market in Malaysia, the 200M could also be viewed as a net investment into the next generation of fund managers.
Bear case, 2033, DPI at 0,5X
Venture Capital Is Hard – And Even Harder In Developing Markets
In my executive education programs on venture capital investing, I always start with a detailed walk through of how hard venture capital investing actually is. Sure, if you are located in the heart of Silicon Valley, have access to the top founders, top programs and top funds, including exit paths like Nasdaq and tech M&A’s, things might just be a little bit easier (but still hard).
But the reality, for most countries, national fund-of-funds and ecosystems is that venture capital investments are hard, really, really hard. Most startups will fail. Many will deliver small returns at best. For a fund to be successful, you need to capture at least 1 Dragon (fund returning investment), maybe even two.
For most of the world, to be able to support and grow a domestic entrepreneurship scene, we need venture capital – and we need much more of it. We simply can not scale startups, new company formation and new job creation without access to venture financing at scale. But no one should for a second think this is easy.
One of the most common phrases participants share in our VC Masterclasses is, “wow, I had no idea it was this hard” (to deliver sustainable returns over time. Well, it is. Let’s not be native about it, but rather work for the long-term to build out more robust VC ecosystems.
What’s Next For Malaysia?
In my work with Malaysia over the past 12 years, I have seen the ecosystem grow and mature. Yet, the country still has a long way to go, to reach its aspirations as a globally leading tech hub.
One step, maturing the VC ecosystem and support a far larger pool of VC firms and capital allocators.
To this effect, the Malaysia Venture Capital Roadmap (MVCR) is a solid piece of work, serving as a great example for other countries in a similar position.
Malaysia Venture Capital Roadmap, 2024
In this conversation we need openness about fund performance, access to data set and we need journalists like Emmanuel Samarathisa to continue with their excellent reporting. But, we also need media to cover this topic with diligence, facts and insights, not assumptions and flawed data set.
I am excited about the future of the Malaysian startup ecosystem and seeing more successful startups, scale ups and fund managers emerge from this amazing country. Reflecting back on my recent trip exploring the VC ecosystem in MENA, I see a vast potential for Malaysia and the wider SE Asia region, but the VC ecosystem will need to continue to evolve – rapidly and professionally.
The author is a strategic advisor to national fund-of-funds, governments and VC ecosystems globally. He has taught a wide range of venture capital executive education programs, including at IMD and NVP. He has worked with 250+ emerging fund managers and regularly hosts VC Masterclasses. His upcoming report on Scaling VC ecosystems is aimed at helping all stakeholders better understand how to create more mature venture financing ecosystems around the world.
https://i2.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1749903627915.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2025-07-04 13:34:002026-05-01 13:34:50Evolving Malaysia’s VC Ecosystem: A Response To The great Mavcap Misfire
The Story Of Scaling Leo Bank From Idea To Exit In The Middle East. Part II: Scaling Up (Series A,B)
Case study written for the upcoming launch of Scale Up MENA! (Aug 2025). Read part I here and part III here.
Closing the series A has been tough. “This is by far the hardest thing I have ever done”, Adnan was bone tired. Leading the process, investor meetings, DD and final negotiations had been hard. But, the round had been a huge success, a new strategic investor was onboard, and the focus was now 100% on hitting the key revenue milestones. $10M revenue, $50M revenue and $100M revenue.
How long would that take?
Looking back, it was the workshop with DFDF that had laid the foundation for the Series A success. Navigating the Road to Series A was a series of workshops hosted by Dubai Future District Fund and AWS, delivered by Chris Rangen. That was one of the key perks of being located in Dubai. The ecosystem was strong, supportive and perfectly suited for fast-growing companies. Maheen and Adnan had both attended the workshop.
Initially, it was overwhelming. 5 phases, 43 unique steps to nail your Series A. It was a lot to take in, but wow!
Sure, Only 10% – 15% Of Companies Successful Make The Jump From Seed To Series A, But This Was A Tall Order Still.
The Funding Journey. 5 phases, 43 steps to nail your fundraising rounds
Adnan had taken three main points away from the workshop.
1. Set your fundraising team
2. Build your long investor list and investor CRM
3. Aim for five competing term sheets
(See Funding Journey for all 43)
Those three points had become their focus.
For the fundraising team, they discussed with the team and agreed. “Maheen and I will take six months, and only, only focus on closing our series A”. The others had agreed with some hesitation. The team had grown to 21 people by now, there was a lot of young talent on the team, but leadership was still needed. “Liz will take over as co-CEO”, Maheen had decided.
Your Funding Team. A key success factors to land your Series A and beyond
The best thing they ever did on the fundraising team was assign two of the data analyst to a skunk project. Together with Maheen and Adnan, the two analysts made up the fundraising team. In just two weeks they built an impressive AI-engine, allowing them to gather 2.400 investor prospects for the A-round. Analyzing track records and strategic fit, the list was cut down to 800. Analyzing capital for follow-on rounds and exit track record, the list was further reduced to 68 names.
Out of these 42 initial meetings took place. The one meeting in Singapore had really stood out. “We will sell your assets to a NewCo in Singapore, do a recapitalization, get rid of your old investors and then inject 500M in growth capital”, the Managing Partner had said. The meeting ended quickly.
In the US, many of the initial meetings centered on use of AI, roadmap to US IPO or downside protection. “It really seems like 3X liquidation preference participating is the new normal here. The valuations may be higher than back home, but the terms are harsh and demanding. Let’s try to find a investor group in MENA we can work with”, Maheen had said as they were flying back from a series of meetings in New York.
Fortunately, via Shorooq’s network, they had found multiple options for the A-round in the region,
Sure, the conversations, due diligence and term sheet discussions had taken months, but ultimately, they were down to three solid term sheet; still not the five they were targeting but still ok. With 800.000 users the user growth was strong, but revenue was still lagging. They had aimed for 3M revenue before closing, but the reality was closer to $2,1M; still some ways to go. This lower-than-forecast revenue, also came back to bite during term sheet discussions.
Three competing sets of terms sheets at Series A
Venture Souq’s Fintech Fund was supportive, and really wanted to get a deal done. “With your metrics, we can do $1M $8M pre, and really help connect you for larger, full series A in about 6 months time”.
The team at BECO had been incredibly supportive and their whitepaper “Strategy in AI’s Shifting Sands: A Venture Framework for MENA Value Creation” had grown into a manifesto for the AI team at Leo. “We would love to work with you, but the metrics you have today does not justify anything above $25M post”, Abdulaziz had stated. Famous for their views on there are only two venture-return size companies born in MENA every year, BECO did not have full conviction on Leo’s return potential yet.
In the end, a structured syndicate come together, co-led by Michael at Golden Gate Ventures, Medea at Global Ventures and Monk Hill taking a minor role. The terms landed on:
-$30M pre-money
– $10M round size, 4M from GGV, $4M from GV and $1,5M from MH.
– Two advisors were assigned a small allocation in the same round.
– 1X liquidation preference participating
– Reset of vesting for the founder team
“The Region’s Banking Favorite Secures Strong Series A”, Read The Press Release When The News Were Released During GITEX.
Cap Table, Post-Series A
Leo Bank’s cap table, post Series A. founders at 40%, with 7,8% remaining in ESOP
Setting Up A Strategic Board
After closing the Series A, Omer had been clear on his recommendation. “We are going to set up a long-term, strategic board that can take us all the way”. The founders had not really seen the need. “We are doing fine”, Maheen had said.
But the investors were clear. A strong board will only help the team accelerate. It was agreed that the board would have two founder seats, Maheen and Adnan, two investor seats and one industry expert. James P. Gorman, former CEO of Stanley Morgan was elected Chairman of the Board after a three month search period.
Team Shake Up
The trouble had been brewing for a while. Maybe it was the stress from scaling from 800.000 users to 2,5M in just six months. Maybe it was just a consequence of having worked closely together for the past 3,5 years. Everyone had felt it, but no one had wanted to get into it.
Looking back, the fallout that followed was almost inevitable. “Listen, I have worked my butt off for years!”, Malik almost shouted. “No, you are not just leaving!”, Maheen replied. The stress, the lack of technical depth on the team, the demands of scaling towards a series B. The journey was not quite what Malik was expecting.
As the technical genius he had built the first generation of the platform, but the reality was that the first generation had just not been scalable. Maheen had spent months recruiting a technical team around him, only to realize that the tech stack they had built just was not very scalable. It had all come to head in one of the engineering team sessions. “So, you are telling me we have to rip out and replace our entire back end platform?”, Maheen had asked the Senior Platform Lead. He has just joined from Klarna, with previous CTO experience from two fintechs in London. The decision had been made. The entire platform was getting rebuilt, redesigned, restructured from scratch. That was the moment when Talik started drifting. He was no longer up to the task. His company had outgrown him. Probably, Maheen could have handled it then.
Weeks had gone by, when Malik broke the news. He had just accepted a role with Microsoft. He would be leaving within the week. He also announced, “I am taking my co-founder equity with me”. His departure from Leo Bank was quickly turning sour. Maheen felt a ting of panic. She had seen too many broken cap tables, with co-founders walking away with large equity positions, leaving the company uninvestable for upcoming rounds. “Foundational equity”, she thought. We have already covered this! She dug through the company files while calling her contact at Shorooq.
Sure enough, the initial foundational equity agreement the four had signed 3,5 years ago covered exactly this scenario. Any unvested shares, in the case of a founder leaving, would go back into the ESOP pool, to be allocated by the CEO. The vesting terms were even reset at Series A, with 7-year vesting and a 1-year cliff. The paperwork was all signed. Malik, it turned out, would be walking away with zero equity.
The next day, Maheen, Adnan sat down with Malik, back at their old Starbucks at the DIFC. “Listen, we don’t want to part ways on bad terms. You have worked hard, we all have, the last 3,5 years. Yet, we have a long, long way to go. We need to manage our cap table for long-term success”, Maheen had said. It took a few days, but in the end, the team agreed on a 1% equity post to Malik, and retain him as a senior advisor for the next 36 months. “Imagine, where would we have been if we did not have the foundational equity paperwork in place”, Adnan said as they closed the deal and parted way with Malik.
Cap Table – Updated Post-Malik’s Departure
Cap table, updated post one of the founders leaving. Thanks to good paperwork, the most of the equity went back into the ESOP.
Market Expansion: Where Do We Ramp Up Next?
“Which of the next markets should we expand into, and how soon?”, that was the question Liz had focused on the last six months.
Ever since they closed the Series A, the mantra was growth, growth and growth. But, more than just growth, her team had managed to build an incredible AI powered tech stack, turning her 25 people team into a 24/7 growth army. “With the new stack, we are automatic processes that would have taken us 3X as many people and months to complete. We have, maybe, the most native AI-GTM stack, by any startup in MENA”. Alex, her head of AI infrastructure had been a find!
She had poached him from OpenAI during one of the OpenAI ecosystem events. He was, it turned out, an AI engineering genius. The team used AWS SageMaker as the core. On the customer facing side, tools like Segment, 6sense, Clay Brand24, Jasper.ai, WhatsApp Business API, Phantombuster, Voiceflow, Madkudu Clearbit, Synthesia and Revenue.io were built into a 24/7 growth engine. “This thing is getting smarter by the minute”, Alex had said during one of their working sessions. Alex had recruited a deeptech team from AWS, Salesforce, OpenAI and Anthropic to build out a new kind of automation ecosystem for Leo.
Using this system, Leo was now able to expand flawlessly across MENA. The system even recognized different regulations in different markets and instantly adapted the platform in line with these regulations. The same had started happening by segments, were people were increasingly seeing a highly, highly personalized version of the platform, from first prospecting touchpoint all the way through daily usage.
Revenue Growth
“How do we build a successful ARR engine to get us to 100M revenue and beyond?”, that was one of the nine questions Maheen had drawn up when they started. Liz, together with Alex and the deeptech team had built just that.
On The MENA Startup Show, Liz had called this “Our beautiful, hyper scaling engine”. Well, the engine had allowed Leo to blitz scale, from 800.000 users to 2,5M users, and now rapidly approaching 5,5M users, in just 12 months. Revenue was starting to pick up, and the finance team was forecasting a robust 35M revenue for the year, looking at $75M next year.
“This is what blitscaling feels like”, Maheen had said during an all-hands meeting.
Leo Bank’s three remaining founders on stage for the monthly all hands meeting. As the company grew to 85, then 120, then again 200+ employees, leadership and culture become a far bigger challenge than the team was ready for
Momentum Going Into Series B
“We need to think about our Series B as stepping stones into the world of large capital allocators”, James had said during a board meeting. Maheen knew he was right.
Thanks to the investor CRM and AI automation they had built for the Series A, and the work the Investor Relations team had been doing, sending monthly updates, taking regular check in calls, hosting investor roundtables in different cities and regularly taking deep dive sessions with the target prospects, the round came together in record time. Sure, they now had 4.800 names in the investor CRM, but there was only a handful that that would really like to work with.
In the end, the team had two competing term sheets, from Wamda Capital and MEVP. Both of them solid investors that could structure rounds from late seed to Series B.
Two competing term sheets from two great Super Investors, Wamda Capital and MEVP. In Scale Up MENA, you will meet and navigate 100’s of competing investors and term sheets. Are you able to unpack the terms here?
Cap Table Post Series B
Cap table, post series B. Now with new investors, two team SPVs, two advisors, the cap table is starting to get interesting.
The Series B deal was a big step up in valuation, taking the company from $40M last post in the Series A, to $300M pre-money for the B. Wamda showed high conviction with a $40M investment, and Golden Gate Ventures, Global Ventures and Monk Hill all followed on with 500.000 each, as per the term sheet requiring three participating co-investors. Management also issued Team SPV #2, with 4.000 shares to the team, who was now quickly growing towards 85 people across four offices. The strike price was set at a 100, instantly giving the staff a 12x multiple on their investment. Of course, the shares were only available on a 7-year vesting schedule with a 1-year cliff, virtually locking in talent to stay with Leo Bank.
Now, The Stage Was Set For The Next Growth Phase. Could The Team Take Leo Bank Past Tabby’s Explosive Growth?
Could they hit 15M users and $500M revenue?
Was there a $1BN, a $3BN valuation on the horizon?
Could they find the growth hacks to scale past Careem’s $3,1BN exit?
Read Next…
Part III: Growth Stage (Series C,D To Exit)
“What does your outcome canvas look like?”, the question from the investment team at Oman Future fund had taken the founders aback. Outcome? Canvas? In exploring a lead candidate for the Series C, it was clear that the conversations, the expectations and the strategic thinking was going to be a big step up from the conversations they had back at Series A. “Are you aiming to list in Riyadh, London or the US?” …. (read part III here ).
Part I: The Early Days (Start Up Phase, Seed)
“There is absolutely a market for new, innovative banking solutions in the region”, Malik said. Sitting at the Starbucks at the DIFC in Dubai, the four friends were deep in discussion about their new startup idea. The discussion had been simmering for nearly two years, but really picked up in the last four weeks…. (read full part I here)
Scale Up Mena!
In Scale Up MENA! you and your team members step into the shoes of a founder team in MENA. You select amongst 30+ case companies. Your task: scale your new case company from an early idea to a successful exit, while also competing with 3 to 20+ other teams, all trying to outcompete and outrace you. Along the way, manage the nine building blocks Maheen identified early on, raise multiple rounds of financing, accelerate revenue velocity, scale with AI tools and try to outcompete the likes of Careem and Tabby. Are you up for it? Are you ready to Scale Up In MENA!?
Globally, more than 3.500 founders, investors and ecosystem builders have mastered cap tables, growth strategy and exits with Scale Up! Now, for the first time, we are ready to launch a 100% MENA version.
Scale Up MENA! From Idea to Exit is one of the world’s leading methods to accelerate a startup’s successful growth journey. The Scale Up MENA! Masterclass is designed to help founders understand how to lead through the founder’s journey, from idea to ultimate exit.
Handle early-strategy, product development, AI, SAFE notes, local accelerators, venture financing, market expansion, ARR growth, growth financing, market leadership and exit transaction – all based on real content from across the MENA region.
https://i1.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1749931804858.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2025-07-04 13:16:002026-05-01 13:22:01Scaling Up In Mena (Part II)
The Story Of Scaling Leo Bank From Idea To Exit In The Middle East. Part III: Growth Stage (Series C,d To Exit)
A three-part story on scaling a fintech in the Middle East, written as a part of the upcoming launch of Scale Up MENA, august 2025. Read part I: the early days (start up, seed): and part II: scaling up (Series A,B)
“What Does Your Outcome Canvas Look Like?”, The Question From The Investment Team At Future Fund Oman Had Taken The Founders Aback. Outcome? Canvas?
In exploring a lead candidate for the Series D, it was clear that the conversations, the expectations and the strategic thinking was going to be a big step up from the conversations they had back at Series A. “Are you aiming to list in Riyadh, London or the US?”.
“Do you have the exit paths ready in your data room?”, the associate had asked over and over again. The truth was, they did not. Not yet.
Series C Led By PIF
Six months earlier.
“Another unicorn minted in MENA”, read the LinkedIn posts, as Leo Bank hit the coveted $1BN valuation mark.
The Series C had come together pretty quickly as well. Public Investment Fund had gotten introduced via the team at Wamda Capital. There was a clear strategic match, and PIF was incredibly supportive on backing a strong growth story.
PIF had proposed a $100M round or a mega $500M round, for 25% ownership. The $500M was simply too much capital, and the board decided to go for the $100M for 10%. There were some demanding terms, and it took a few weeks to negotiate out some of the most challenging terms, but they got it done.
Cap Table Post Series C, With PIF
Cap table post Series C, PIF’s team also corrected the new reality for Malik’s PPs, at $50,- effective
Market Expansion, Market Expansion
The new capital from PIF had been used for market expansion, both to strengthen the position across MENA as well as launching in key, new markets like Singapore, India and Pakistan. “Rest is not an option, we need to grow, grow, grow”, was the new mantra across the growth teams.
Dealing With Massive Scaling Challenges
“Being a seed company is easy, trying to scale is a whole different game”, Liz was getting worn down. Leading the new market expansion, she was the one spearheading all market- and revenue work.
Her role as CRO had taken on a whole new level of complexity. Managing 590 people, she realized she no longer could work the way she and her teams had so far. New structures, processes and procedures were needed, and needed fast. “At this pace, I am going to run into a brick wall”, she had shared with Adnan and Maheen during one of their 5 am morning runs.
Closing Series D With Future Fund Oman
The first introduction to Future Fund Oman had come through their board member from PIF, Omar. Having worked in multiple family offices and now in a senior investment role at PIF, he was deeply connected across the region. Future Fund Oman, was in Omar’s view, the perfect growth-stage investor for Leo Bank.
Over a series of meetings, Adnan and the team came to understand the methodology and investment process Future Fund Oman applied. The Outcome Canvas, or Outcome scenario analysis, or just sensitivity analysis, this was a must-have for the 12-person investment team at Future Fund Oman.
It took longer than expected, but finally both sides arrived at an Outcome assessment they could buy into. A mere 3% chance of achieving the Outperform scenario, it was a tall order for Adnan and the team to scale to become a top performing investment for FFO.
Future Fund Oman, in the end, signed onto the investment papers to lead both Series E and Series D, granted the company was able to hit the revenue milestones in the growth plan. “Of course, we’ll hit them”, Liz said as she put her team to work.
Outcome Canvas, for Leo Bank. In Scale Up MENA! Masterclasses participants learn to apply the Outcome Canvas and start working on crafting a strategy and narrative around investor returns.Future Fund Oman was eager to do a $200M round at $2BN, then roll into another $200M @3BN, once the commercial milestones were hit.
Cap Table Post Series D With FFO
Cap table post Series D, PIF and FFO both with 9,1%, while Wamda still has the highest equity post at 9,6%.
Cap table post Series D with FFO coming in for the first round.
Cap Table Post Series E With FFO
With the Series E financing, taking the Leo Bank to $3,2BN post-money valuation, the increase in valuation and return multiple were really starting to kick in. While still completely unrealized gains, the early investors were looking at a 350X return – and still sizeable ownership in
“Leo has the potential to become one of the region’s breakout winners”, members of the Dubai Angel Investor Network discussed in their annual investor summit.
Cap table post Series D with FFO taking the second round, for a total investment of $400M. Post Series E, Future Fund Oman increase their stake to 14,8%, becoming the leading investor in Leo Bank.
Rebranding, Product Expansion
“It’s time to launch the next version of Leo”. The product team had worked on this for nearly nine months. The next version of the product roadmap was an ambitious step up. “So, so much more than just a bank. We are becoming the digital backbone for 100M people in MENA”, Basil, the new Chief Product Officer had stated. With backgrounds from Twitter and WhatsApp, he had seen what it took to develop scalable digital products that people loved.
“Also, with the new product launch, we are doing a rebrand. From now on, it will simply be Leo”, Maheen and Liz announced at the monthly all-hands meeting. Growing, with over 4.000 team members, the all hands were now more digital than ever, but also a key part of maintaining the team culture and cohesion as they grew at breakneck pace.
Exit Paths
“How do we create liquidity and exits for investors and founders?”, the question had been circulating in the finance team for some months now. It was the angels from DAN who had first brought it up. One of them, Sanjana Raheja had been an exceptionally active angel. As an active member of the ecosystem, Sanjana, or just San, had been coaching the team for months now. “I’d like to see some more non-obvious exit pathways that come in”, She had asked.
Using the GP Exit Paths, from Strategy Tools, San had provided the investment team with a simple, visual structure to start mapping out more exit paths. “Not all exits are exits”, San kept saying. “We need to think about investor liquidity throughout the founder’s journey, not just as a possible big bang in 5-10 years time”. San was a trusted advisor to both startups, scale ups and emerging fund managers, known for her depth and reflective thinking about creating new paths to liquidity in the region.
Under San’s guidance, and working with Michael at Golden Gate Ventures, the investment team developed the GP Exit Paths, taking the view of GGV. GGV was coming towards the end of their fund lifetime, and access to disciplined liquidity was becoming a thing.
GP Exit Paths, San and Michael worked with the finance team to map out possible paths to liquidity, seen through the lens of GGV
Thanks to San and Michael’s guidance, the finance team managed to get a clear understanding of what an investor like GGV was looking to achieve, and realizing that paths to liquidity was something they had to create, not just wait for.
Tackling Growth Pains, Leadership And Culture Issues
“I had not idea this would take so much of my attention”, Maheen was speaking with her performance coach. She had built Leo into a strong regional brand, with 4.500 employees, and millions of delighted users. But the cracks were starting to show.
Of the top 200 leaders in the company, few had ever scaled a company like this, this fast. Maheen had grown accustomed to focusing externally. “Strategic partnerships, investors, media; that’s been my focus. Now I am realizing my leadership bench is not what I hoped it would be. I am going to spend more time internally, developing the people and culture to carry us forward”, she said.
it was the regular monthly check-ins with Tiffany and Nader that had gotten her to think about the depth of leadership on the team. DFDF had a portfolio-support program, aimed at supporting the fastest growing, high potential companies across their direct and fund portfolios. With over 145 investments, only 5-6 founders got the Scale Coach support from Nader and Tiffany.
Earlier in her work, she had benefitted from the team at Misk Foundation. Now, as the company was working into the Series F, one of the few to ever happen in the region, strong leadership, rapid talent development and focus on culture across 24+ offices would be required. “You have built a rocket ship, but can you steer it?”, Nader had asked over a late dinner at 24th St. World Street Food
Series F – Led By Mubadala
“Mubadala is probably one of the most influential investors in the region. It will be a big win for us”. The board discussion had centered on the recently received term sheet from Mubadala Capital.
High-level terms sheet from one of the most sought after investors in the region. Used for training purposes in Scale Up MENA!
Mubadala Capital was proposing a multi-tier structure with the following highlights:
– Direct equity $25M @2,5X mark up from last post-money valuation
– Venture debt $20M, with 15% interest
– Secondaries purchase of 10% equity from existing shareholders, with 25% discount
All told, the deal would value Leo at $7,5BN pre-money, and it would give Mubadala a 10,3% ownership post, making them the second largest shareholder after Future Fund Oman.
Interestingly, a key part of the transaction was how Mubadala structed the equity.
$25M would come in a direct investment. But $562M would be used to buy out shares from earlier investors, at a 25% discount, if they could find any takers for it. “Wow, that is both a challenge for us and a great opportunity for our investors to take some money of the table”, Adnan had said. “This is exactly the kind of opportunity I want to be able to present to our investors”, Maheen had said.
The Mubadala Secondaries Transaction
It took a few weeks to structure the transaction, but everyone had been supportive and wanted to help make it happen. “This is just too good to be true”, Liz’s older brother had blurted out when he realized the offer. He and his friends would be able to sell 6.000 shares, continue to hold on to 14.333 shares, and with the sale alone, they would cash out $90M.
Sure, he had expected, or rather hoped for a payout when they first invested in Leo, but nothing, nothing like this.
This deal also allowed for some of the very earliest employees, the ones that had been with Leo since the first year, to cash out some earnings. A total $22M went to stakeholders in the SPV.
“What Mubadala is doing here is superb. The ecosystem really needs more paths to liquidity”, Adnan said to his finance team went they were structuring the secondaries.
Nine entities, including many early employees came together to meet the 10% secondaries requirements in Series F.
Cap Table Post Series F With Mubadala
With the combined direct and secondary transaction, for a total investment of $587M, Mubadala was coming in as the second largest shareholder, after Future Fund Oman. New in this round was the issue of another 8.000 shares in a new Team SPV, and a dedicated 1,1% equity incentive for the full management team.
Cap table post Series F. Notice the wide range of return multiples in the last column. Your entry price really matters.
With the updated cap table, Future Fund Oman and Mubadala would be the two largest shareholders, with 15% and 10,3%, respectively. The two investors had invested close to $1BN in direct, and secondary transactions.
Wamda Capital and PIF each held around 8% – 9%, but with very different entry prices, at 1.198 per share and 3.156 per share, respectively.
Collectively, the three remaining founders held exactly 20%, and another 0,8% as participants in the newly set up Management SPV.
In Conversations With Mubadala, The Investment Team Commended Them, “You’ve Really Managed To Structure A Clean And Balanced Cap Table. We Don’t See That Too Often. Well Done.”
Taking On Venture Debt At Scale
“We should really explore venture debt”, the finance team had been looking at more non-dilutive ways to finance the growth.
Oman Venture Financing Company had increasingly become the issuer of choice. In a series of meetings in Oman, the OVFC had emerged as a strategic partner that understood how to aggressively fund market expansion.
“We want to see more high-growth cases emerging out of the region, with the potential to go global”, the Investment Director had said during their discussions. The term sheet came together in a few weeks, where OVFC was willing to finance up to 8X ARR; but recommended capping the debt at 2X ARR. Ultimately, the finance team agreed to a low ARR ratio, with a debt of 600M. At 12%, it was an expensive solution, but the board agreed to the proposition, rather for doing a Series E. The terms were demanding, but the finance team had worked on multiple risk scenarios and were comfortable taking on the debt on said terms.
Venture debt should always be a part of your capital stack, just make sure to read the fine print and map out risks, scenarios and notably, worst case scenarios. Not sure the finance team did it well enough here. What do you think?
Negotiating On Incoming Acquisition Offers
Following the investment from Mubadala, it seemed like the entire world came knocking.
Over a period of 3 months, the board received no less than 8 initial acquisition offers. “Things have really changed for us”, Liz said in one of the pre-board meeting discussions. “Yes, but we are not selling, and not selling at any kind of low-end pricing”, Adnan had been clear on that. After all, he and the IR team had promised early investors outlier returns, and he felt a strong, personal desire to deliver on his promise.
Attractive exit options discussed at the board meeting
Yet, the board took the acquisition offers seriously, recognizing their fiduciary duty to shareholders. For the Q1 board meeting, four offers were looked at serious.
Microsoft was willing to acquire Leo for a 2,2X last valuation, which would take the company to a $16,6BN valuation. But, the deal was paid in Microsoft shares with a 2-year lock up. Nobody really felt good about that option.
Aramco, interestingly enough, was looking to invest into fintech as part of their wider diversification strategy. 2X last post would take the company past $15BN in exit value. Paid all cash, this was a very interesting deal for shareholder. “We are not looking to sell to an energy conglomerate”, Maheen was not interested in going down that route.
Gulf Capital had put in a very interesting proposition, at 1.5X last post, coming in at $11,3BN, but the term sheet revealed a massive debt for the company, effectively taking on more debt than the company could service under its current model. “We just can not recommend this”, Zara, head of risk management had stated.
Finally, First Abu Dhabi Bank had spent months meeting with the team, talking to customers, and probably done the most extensive due diligence by any of the potential acquirers. The M&A team positioned the acquisition as a strong merger amongst equals, looking at Leo as the platform the digital expansion for the Bank.
The team was enticed, and at 2.6X last post, the deal would come in at $19BN. At a $47BN market cap, the deal would be a massive, strategic move by FADB. “Are we really ready to work with a big, established bank, or do we want to chart our own future?”, that was the question the board had discussed
Ultimately, The Board Had Turned Down All Four Aacquisition Offers.
“Give us a few months, let us show you what we can do”, Maheen had said. “My team is accelerating our revenue growth. Our journey is still just beginning”, Liz had followed on with. The board had agreed. “Let’s see where we go from here”, Maryam, Future Fund Oman’s board representative had agreed.
Charting A Strategic Path: Going Public On Tadawul
“Yes, yes, I know, we could choose to go for a Nasdaq listing”. The discussion had been going on for a couple of weeks already. As chairman of the board, James had helped the team really ask some fundamental questions around the path for the next stage of growth.
“You have really sound fundamentals, we can virtually guarantee a successful IPO in New York”, one of the investment banking teams had pitched.
They were right. By now Leo had amassed 16M users, forecasting to hit 40M users in 24 months. The trajectory was insane. Revenue, and notably the recurring part of the revenue mix was following a similar chart, taking Leo to $1.1BN revenue this year, and a target of $2.1BN revenue next year.
In Scale Up MENA! the IPO is one of the most valuable cards a team can get their hands on, but beware, it is complicated…..
“I know we could probably get a higher valuation in New York”, Maheen said. She had been flying between New York, Singapore, London and home non-stop for the past 8 weeks.
“But there is something deeper here. We are a product of the ecosystem. We would never have been here without the vast, extensive help and support we got along the founder’s journey. From the coaching sessions with DFDF, the workshops at Hub71, the angel connections at DAN and the mentors we got from the DIFC meetups. We are a product of the ecosystem, and I would like to make sure we are now finally in a position to give back to that ecosystem”, Liz had fully agreed, while parts of the board was still contemplating a NY IPO.
The board had run an investment bank beauty contest, inviting eight banks to pitch for the IPO process. The shortlist had come down to Goldman Sachs and a strong, local team in MENA, led by Emirates NBD Capital.
“Listen, when we set out to build Leo, we aspired to outperform Careem. We have achieved that. Now, we have the chance of really stepping it up one step further. Talabat was a marquee IPO for the region. We could choose to work with the same team, the team that listed Talabat. We could aim big and try to secure an IPO that would exceed Talabat”, Adnan had grown increasingly impressed with the local team, led by Emirates NBD Capital.
Ultimately, The Board Decision Was Clear. Leo Would Go For A Local LPO, Led By A Total Of 9 Investment Banks, Under The Guidance Of Emirates NDB Capital.
Listing Advisor: Emirates NBD Capital PSC acted as Listing Advisor
Joint Global Coordinators: Emirates NBD Capital PSC, J.P. Morgan Securities PLC, and Morgan Stanley & Co International PLC as joint global coordinators and joint bookrunners
Joint Bookrunners: Abu Dhabi Commercial Bank PJSC, Barclays Bank PLC, EFG-Hermes UAE Limited, First Abu Dhabi Bank PJSC, Goldman Sachs Bank Europe SE, ING Bank N.V., and UniCredit Bank GmbH as joint bookrunners
Legal Advisor: Linklaters
“This is exactly the same team that Talabat used, I have high expectations here”, Maheen had concluded with the board as the company and its line up of advisors started preparing to take Leo public.
Understanding Ultimate Ownership And The Impact On The Ecosystem
During one of their flights to Abu Dhabi, Adnan and Maheen had sketched out something interesting. It was a chart of the ultimate shareholders, owners, investors in Leo. “Our cap table is pretty easy, with 22 entities listed. But I’ve been thinking. In total we now have more than 4000 employees in our SPV’s, we have 24 angel investors from DAN, we have five VC funds, each with 20 – 250 limited partners behind them. By my account, we have more than 5000 people as direct or indirect owners in Leo, and that is not counting our larger funds”, he said.
“Imagine the impact on the region, on the ecosystem, when we go public. It has been a long, 7-year journey already, but this could have a massive impact on the ecosystem, and create a lot of wealth for the people that believed in us early, not to mention the early employees that have been with us since the early days.” , Adnan said as the plane was starting to descend on Abu Dhabi.
IPO Readiness
“Ok, there are still some requirements to sort through”. The team from Linklaters had prepared the legal brief for the team and board.
“30% free float and one-year lock up is easy. The challenge is how we choose to restructure the cap table, and ultimate ownership to meet the requirement of 200 unique shareholders at the time of listing”, the Managing Partner at Linklaters said.The legal team had worked on finalizing the paperwork alongside the Issuer team in Riyadh.
The Decision Had Been Made. Leo Was Going Public On Tadawul.
Roadshow And Valuation Multiples
In the roadshow materials, there was one key slide that had stood out.
How does Leo stack up vs. global peers?
At $2,1BN revenue and a $13,5 target IPO value, Leo got a 6.4X valuation-to-revenue multiple. Post IPO, with new equity in, Leo would be looking at a 9,3X multiple. “Leo will be one of the fastest growing fintechs to go public, and compared to Chime, Adyen and Revolut, there is still massive upside for new investors”, the team from Emirates Capital and Morgan Stanley had repeated in investor meetings.
That Slide Had Sealed The Decision For Most Cornerstone Investors In The LPO.
IPO Celebration
The founders during the IPO, the third biggest IPO ever in MENA
“Wow, what a day. Do you guys remember the first sketches we made back at the Starbucks at DIFC?”, Liz was euphoric. “It truly has been a journey”, Adnan smiled. They had grown the team to 5.000+ people, scaled to 35M users and well over two billion in revenue.
“But, remember, we are just getting started”, Maheen followed up.
The Team From Emirates Capital Had Been Clear. “Some People Call It An Exit. It Is Not. Going From A Privately Held Company To Becoming A Public Company Is Not An Exit. It Is A Transition. It’s A Step On Your Founder’s Journey.”
The decision had been made to raise $6BN in new equity at the IPO. The listing had been massively oversubscribed, indicating a strong demand for new tech companies in the region. PIF and Mubadala had been exceptionally helpful on the roadshow, often joining the management team on the road.
Based on market feedback, the valuation was set at $13,5BN at listing, outperforming the $10BN Talabat listing a few years earlier. “The biggest tech IPO this year”, Forbes Middle East plastered on the front page. Financial Times called Maheen “the rocket ship CEO, guiding the biggest listing in years”.
The $6BN raise at a $13,5BN valuation also passed the requirements of a 30% free float in the market.
“We are proud to give the public a chance to invest in Leo today. Since our launch we have tried to build and scale the bank of the future for the MENA region. At today’s IPO shows strong interest in the stock, but we are only just getting started. The best parts is still ahead of us”, Maheen said on CNN Market Watch with Becky Anderson.
CAP TABLE AT IPO
Based on Saudi Arabian listing requirements, a total of 30,7% of Leo’s shares were made available in a free float, or IPO pool. This would allow the company to raise $6BN and becoming the third largest IPOs ever in the Middle East, just behind Aramco and DEWA.
Cap table at IPO, raising $6BN, meeting the 30% free float requirement and setting the company up for the next growth phase. IPO is just one step on the journey.
“At A 1.240x Return, This Has Been One Of The Most Amazing Founder Journeys Ever, In Mena”, Having Backed Leo Since The Early Days, Shorooq Partners Were Delighted To Announce The Outcome For Their Limited Partners On An Update Call On The Same Day As The LPO. It Was A Huge Win For Their Fund.
“We are delighted to back the next generation of fund managers in the region, and the team at Shorooq has shown what is possible when we develop strong, outperforming GP teams in the region. We are not surprised to see, but wish to congratulate the entire team with this big win”, DFDF’s Mahmoud Ward said in a statement to the Wall Street Journal. DFDF stood to take home a 14x net DPI on the back of an excellent portfolio in Shorooq Fund IV.
Shorooq Partners, Golden Gate Ventures and Global Ventures, Monk Hill all secured a coveted Dragon in backing Leo. A Dragon, or a single deal, that ends up returning the whole fund, is about 4X as rare as securing a unicorn. For fund managers, it marks the entry into the global top league of VC investors.
One of the big winners in the IPO had been Wamda Capital. With their record $40M investment, at $300M valuation, many had said they were crazy, investing at far too high a valuation. “Many said the deal would never, ever return back much”, Wamda’s Managing Partner said on a podcast with MAGNiTT. “but, hey, we saw the potential, we believed in the team and we believe in the rapidly maturing ecosystem. Our $40M investment returned us 30X, for a total valuation of $1,2BN”.
“Dude, That’s The Stuff That Legends Are Made Of”, Philip Had Said On The Podcast.
PIF returned back 11X, but decided to stay on as a long-term investor, also taking a minor post at IPO, to indicate further backing of Leo. Looking back, Mubadala’s decision to do the $530M secondary was a genius stroke, as the investment secured a 2,4X return. Not bad for a late-stage deal.
Employees, now counting 5.000+, all made out very well with the Special purpose vehicles. After the IPO, 3,2% was owned by employees and management, with another 2,6% available to secure future talent in the ESOP.
“We are immensely proud to see homegrown talent choose to launch, scale and list in the region. This talented group could have chosen to build anywhere, but they choose MENA, and what a journey they have had. We are proud to be early backers and we are delighted to see the ripple effect of this success story in the region”, speaking at the annual MEVCA Investor Summit, Dubai Angel Network Chairman was delighted.
Dan Had Made More Than $611M, Off Of Their $500.000 Investment At Pre-seed. “we Got A 1.222X Return On The $500.000 We Invested. This Stands As One Of The Best Angel Investor Deals Ever, Fully On Par With The First Angel Investors Into Google And Ebay Back In The Days. Now, We Hope To See Many More Deals Like This, As The Leo Mafia Start Launching The Next Generation Of Start Ups Here. We Stand Ready To Invest.
Of course, the three remaining founders, Liz, Adnan and Maheen, each hit an equity valuation of $907M at IPO. With various management incentive programs, combined with strong upside potential in the stock, most analysts predicted this could rise to $1,5BN within the next 2 years, minting three new billionaires in the region. Lock-up and market expectations would mean this would not get liquidated to cash anytime soon, but generational wealth was being created in the MENA ecosystem.
Speaking as the opening keynote speaker at Dubai FinTech Summit, Maheen shared her thoughts on the future of Leo. “This truly was the result of the ecosystem coming together, maturing. When we started, we knew little beyond raising a few SAFE notes and a seed round. We got extensive help and support, coaching and mentoring. We secured great talent, we build a world-class board. But, in sum, we owe our success to the entire MENA ecosystem. We are truly coming of age, all of us. Looking ahead I believe the best is clearly yet to come”.
The End. For Now.
Make sure you also read part I: the early days (start up, seed): and part II: scaling up (Series A,B).
Did You Enjoy Leo’s Journey?
What did we get right? What is clearly wrong? Where would you have liked the team to go differently? Let us know in the comments.
Scale Up MENA! Launching In August 2025
In Scale Up MENA! you and your team members step into the shoes of a founder team in MENA, just like Liz, Maheen, Adnan and Malik.
You select amongst 30+ case companies. Your task: scale your new case company from an early idea to a successful exit, while also competing with 3 to 20+ other teams, all trying to outcompete and outrace you. Along the way, manage the nine building blocks Maheen identified early on, raise multiple rounds of financing, accelerate revenue velocity, scale with AI tools and try to outcompete the likes of Careem, Tabby and Talabat.
Along The Way, You Learn How To Read Term Sheets, Structure Investment Rounds, Develop Your Growth Strategy, Build Paths To Liquidity, Speak In Investor Outcome Terms And Complete An Exit Transaction – All Core Skills You Need To Scale Your Real-life Start Up
Globally, more than 3.500 founders, investors and ecosystem builders have mastered cap tables, growth strategy and exits with Scale Up! Now, for the first time, we are ready to launch a 100% MENA version.
Scale Up Mena! From Idea To Exit Is One Of The World’s Leading Methods To Accelerate A Startup’s Successful Growth Journey. The Scale Up Mena! Masterclass Is Designed To Help Founders Understand How To Lead Through The Founder’s Journey, From Idea To Ultimate Exit.
Handle early-strategy, product development, AI, SAFE notes, local accelerators, venture financing, market expansion, ARR growth, growth financing, market leadership and exit transaction – all based on real content from across the MENA region.
https://i2.wp.com/www.engage-innovate.com/wp-content/uploads/2026/05/1750016011276.png?fit=1280%2C720&ssl=17201280Christian Rangenhttps://www.engage-innovate.com/newsite/wp-content/uploads/2016/11/engage-innovate-logo-main-header-1-300x157.pngChristian Rangen2025-07-04 13:06:002026-05-01 13:23:47Scaling Up In Mena (Part III)
