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    HomeEcosystem NewsNORTHERN AFRICAWith 25% Stake, Swvl Founder Chooses Growth Over Dividends After Profit Turnaround

    With 25% Stake, Swvl Founder Chooses Growth Over Dividends After Profit Turnaround

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    Swvl Holdings Corp (Nasdaq: SWVL), an Egyptian-based pioneer in public transportation services, has outlined ambitious plans to reclaim its position among unicorn companies within the next two years. Mustafa Kandil, co-founder and CEO of Swvl, shared insights into the company’s strategy shift and financial performance in an interview with Al-Sharq, monitored by Launch Base Africa. 

    Kandil revealed that Swvl aims to regain its stature by focusing on expanding into fast-growing developed markets alongside its stronghold in Egypt. The company, listed on the American Nasdaq stock exchange, has pivoted its strategy to concentrate on developed markets, with Egypt being the sole exception among developing countries where expansion is on the horizon.

    The company, founded in April 2017 and headquartered in Cairo with administrative and financial operations based in Dubai, provides mass transportation services via minibuses, allowing passengers to book and pay fares through a mobile application. Since its inception, Swvl has amassed approximately $640 million in funding through various financing rounds.

    Despite facing turbulence in its valuation, with a market value fluctuating from $1.5 billion in 2021 to a low of $6 million in March 2023, Swvl has demonstrated resilience, currently boasting a market value of about $190 million and a share price of $13.7.

    Highlighting Swvl’s expansion efforts, Kandil noted that the company’s presence in Saudi Arabia has tripled in size over the past year, with further growth expected in 2024. Swvl is actively engaging with stakeholders in Saudi Arabia, including the government, to align with “Saudi Vision 2030” and leverage artificial intelligence to optimize transportation networks.

    In a strategic move towards profitability, Swvl has exited markets with minimal impact, such as Turkey, Argentina, Kenya, and Pakistan, redirecting its focus towards stable currencies in developed markets. Despite challenges, Swvl achieved profitability in 2023, marking a significant milestone in its journey.

    About the company’s recent acquisition spree and divestitures, Kandil clarified that the company had established a footprint in approximately 13 markets without physical offices. Through strategic acquisitions, Swvl provided technology solutions to businesses and governments in these regions. However, he noted that the costs associated with these acquisitions were considerable, particularly in countries like Germany and across Europe. In alignment with its profitability objectives, Swvl made the decision to discontinue this business model.

    Kandil emphasized Swvl’s commitment to further expansion, with plans to penetrate European and North American markets by 2025. 

    In the meantime, the company intends to reinvest profits into future growth initiatives rather than distributing dividends to shareholders at present. Kandil stated, “We may resort to increasing capital if we need to finance future expansions.”

    With Kandil holding a 25% stake in Swvl, executive management owning approximately 7%, and “Beco Capital” holding less than 10%, the remaining shares are distributed among various investment funds and international and Arab investors.

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