Believing in IPOs & Unicorns

“Now I’m a Believer / Not a trace / Of doubt in my mind”

The Monkees. Lyrics to I’m A Believer, 1966

The Monkees scepticism was vanquished back in 1967, and the markets demolished any questions we had about market depth and breadth in 2024 with an onslaught of interesting new equities. Many thought the IPO story was a fairytale that would end with the skyrocketing price of MBC Group early in the year, but our doubts were erased in November 2024, when we found ourselves juggling 8 active deals across 3 markets, each IPO more interesting than the next. From food delivery to online beauty retail to retail investment platforms and more prosaic listings in the supermarket and hospital space, it was a frenetic month! Not only is the American Dream alive and well in Dubai, but it also appears to be increasingly in vogue in Saudi Arabia and beyond.

Critically for the public equity market, an increasing share of GCC private sector GDP across an ever-widening range of industries is investable for us. Over the past 5 years, sectors such as digital and IT services, employment services, non-bank financial services, K12 education, and food delivery services saw significant IPO activity, with over 2 dozen listings and close to USD 100 billion in market capital at year end 2024. Moreover, these companies stand out for their strong operating performance, robust growth profile, and efficient cash generation on both a global and a local basis. They represent a growing share of long-term investments and key contributors to our portfolio.

A look at our 2025 docket (already active with several deals kicking off in the first weeks of 2025) reveals a similarly interesting mix of digital services, real estate, and new-economy businesses, paired with the ongoing spinout activity of successful subsidiaries of longstanding family business in the Gulf. Moreover, the stable of MENA unicorns (particularly in the payments space) continues to grow and we expect to see several such unicorns prance out of fairy tale and into the public