bags $20 million of investment

CEO Ramzi Zeine confirms a major cash injection and insists that the company will continue to rely on advertising as its primary revenue source.

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By  David Ingham Published  June 12, 2001 confirmed today that it has recently closed a $20 million round of funding. The broad list of investors includes Intel Capital, Prince Al Waleed Bin Talal and OM Juffali, although the company did not give details on how much each individual investor had contributed nor how much of Arabia they now own.

Ramzi Zeine,’s CEO, said the announcement showed that Arabia’s investors believe wholeheartedly in the company in spite of its recent layoffs and at a time of huge scepticism towards dot-coms. “Our shareholders are in for the long haul and believe in the management and the business model,” said Zeine.

One thing that remains clear after today’s announcement is that Arabia will continue to rely on advertising as its main source of revenue. That comes in spite of the global slowdown in online advertising and predictions that it will remain relatively small in the region for the foreseeable future. For example, Ajeeb Research Unit predicts that the value of online advertising in the Middle East will reach only $5 million this year.

“We’ve already seen a large increase in the number of advertisers this year,” argued Zeine. He added that’s sales team has recently accelerated its efforts to educate the region’s marketing community and convince it that online is a valid marketing medium.

Intel Capital is believed to be putting the largest amount of money into However, the company, represented today by Intel's regional manager Gilbert Lacroix, admitted that its investment in Arabia is not motivated by a desire to profit from equity.

“It’s not really about making money, the objective for Intel is to encourage Internet usage,” said Lacroix. “The ROI for Intel is in the development of the Internet [in the region.]”

In terms of profitability, Zeine said that he is now looking at becoming profitable in two to three years time. This recent round of funding will help to increase Arabia’s depth of content and will be used to finance regional roadshows, aimed at building awareness of the Internet and “We hope our users will be the first beneficiaries from this,” said Zeine.

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