Cairo-based loyalty solutions provider Dsquares raises fresh funds for expansion

Cairo-based loyalty and rewards solutions provider Dsquares has raised fresh funds from Egyptian private equity firm Lorax Capital Partners, the PE firm announced today. The investment has been made as a result of Lorax Capital Partners acquiring a ‘significant minority stake’ in the company, it said in a statement.

The firm has also acquired the minority stake of Ezdehar Management in Dsquares. Ezdehar, also an Egyptian private equity firm, had invested in the startup in 2018 (the deal was announced in March 2019), and according to Enterprise owned a 22.5 percent stake. So now Lorax Capital Partners owns that 22.5 percent plus whatever it has acquired by injecting fresh capital into the company.

Algebra Ventures that had previously invested in Dsquares in 2019 also took part in the latest deal.

Founded in 2012 by Marwan Kenawy, Ayman Essawy, and Momtaz Moussa, Dsquares claims to be the biggest full-service loyalty solutions provider in the Middle East & Africa. It manages all technical, operational, and commercial aspects of these solutions for its clients, helping them increase customer loyalty and retention. Its clients leading players operating in the banking, telecom, FMCG, retail, and oil & gas sectors.

The startup has a network of 900 brands with over 11,000 outlets across different sectors in Egypt, Jordan, Romania, Kenya, Tanzania, Morocco, Saudi, and UAE. What this basically means is that Dsquares can offer loyalty programs to its clients in which there customers can redeem (or even earn) rewards from these brands. An example is Dsquares’ campaign for Vodafone – which allowed customers of Vodafone to earn and redeem points when they shop on (in Egypt).

But it’s not just businesses Dsquares has built solutions for. In 2019 – around the time when it announced its investment round, Dsquares launched Lucky, a mobile app offering customers discounts from different brands. In a statement today, Dsquares said that Lucky’s app has been downloaded over 5 million times (in the last two years) with its network covering thousands of merchants in different categories. As the startup already had relationships with those merchants for its B2B solutions, getting them on Lucky would’ve been an easy task.

How Lucky works is that the users browse through different offers on the app, select the one they want to use, and then redeem it by scanning the QR code when they’re in the store.

Marwan Kenawy, the co-founder and CEO of Dsquares, said, “The LCP partnership and investment will help Dsquares expedite its clients and merchants expansion plans in the Middle East, Africa and Europe and maintain its position as the loyalty & rewards solutions leader in the region.”

Momtaz Moussa, co-founder and Managing Director of Lucky, said, “By becoming the leading offers platform, Lucky has been digitizing its users’ commerce transactions. We are utilizing this data to provide a more convenient purchasing experience as well as maximizing savings and payment flexibility. That level of understanding of user behavior is now helping us introduce financial products that would otherwise be inaccessible to most of our users.”

The investment will be used by Dsquares to support the scaling of the new business line and for its geographical expansion across Egypt and internationally.

We’ve reached out to Dsquares to learn more and will update the story if we hear from them. 

Zubair Naeem Paracha
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