Lokalee Founder Samir Abi Frem On His US$12.8 Million Exit
Frem's UAE-based traveltech startup was acquired last year in November by Switzerland-based beaconsmind Group.
Launching and scaling a tech startup is no easy feat, and taking it to a level where it becomes an acquisition target for another company is an endeavor that requires strategic foresight and careful planning.
Lokalee founder and CEO Samir Abi Frem is an entrepreneur who can testify to this – after all, his UAE-based traveltech startup was acquired last year in November by Switzerland-based beaconsmind Group for CHF11.6 million (US$12.8 million).
According to Frem, this transition for his enterprise – which is a software-as-a-service hospitality platform that provides artificial intelligence- driven digital concierge services – was a smooth one, and he credits this to him and his team focusing on a couple of key factors throughout the process.
“Preparation is everything,” he tells Inc. Arabia. “I cannot stress this enough. Setting up a scalable and sturdy business model with working systems was at the top of our list to make this possible. We implemented robust and transparent reporting systems in order to assure potential investors of our growth trajectory. We engaged in ongoing dialogues with stakeholders and partners to refine our bottom line, product-market fit, and positioning.”
“Also, prioritizing intellectual property protection and making sure regulatory compliances are intact is a core requirement for acquisition readiness,” Frem adds. “In addition, we created a forward-looking vision that clearly communicated our startup’s acquisition goals, and helped keep our team focused on the end game. We learned that cultivating a strong team culture is a key acquisition requirement, beyond technology and financials.”
Frem also points to operational readiness as being a critical part of preparing for an acquisition, wherein by conducting regular – and careful – audits, businesses can address inefficiencies before they become obstacles. “Before the acquisition, we conducted a comprehensive operational audit to evaluate every aspect of our business,” Frem reveals. “By identifying any potential gaps or inefficiencies early on, we were able to address them before the acquisition process began. This thorough preparation provided our acquiring company with confidence that there wouldn’t be any major disruptions during the integration phase.”
Another important aspect to ensure smooth integration was clear and consistent communication, Frem says. “From the outset, we established open channels of communication with the leadership of the acquiring company to ensure that we were aligned on goals and progress, reducing the risk of misunderstanding, and aligning both teams culturally and operationally,” he explains.
A comprehensive knowledge-sharing strategy also helped, Frem says. “We recognized that transferring essential knowledge, such as proprietary technology, internal procedures, and best practices, was critical to the success of the acquisition. This preparedness helped our teams hit the ground running post-acquisition, reducing the typical delays seen in integrations.”
Considering Frem’s success in orchestrating the acquisition of his entrepreneurial venture, startups seeking similar exits would be wise to follow his notes in this matter. Here are his top tips for startups wishing to enhance their attractiveness to potential buyers:
Focus On Scalability
“Many startups focus on creating a competitive edge, when building a scalable offering is far more attractive to acquisition. Startups should demonstrate that their offering can grow and adapt to market demands.”
Show Measurable Success
“Demonstrate consistent growth metrics and strong market presence. Acquisition decisions are heavily influenced by measurable success.”
Build Strategic Networks
“Networking and high-value connections should be a consistent core business practice. Relationships with key players in your industry can open doors and create opportunities for acquisition or collaboration down the road.”
Prioritize Transparency
“Build trust through transparency and organization. Being transparent with your operations, financials, and plans, coupled with organized documentation and reporting, instills confidence in potential buyers.”
Embrace Innovation
“Constantly refine operational efficiency and innovation to show that your company is forward-thinking, and capable of thriving in a dynamic market.”
Consider Cultural Compatibility
“While not a requirement, achieving cultural compatibility with a potential acquirer can make integration smoother. Think of it as finding a strategic fit that makes the acquisition beneficial for both parties.”
