Top 10 best Unicorns In Saudi Arabia

Top 10 Unicorns In Saudi Arabia

Unicorns: To turn the Kingdom into an innovative fintech hub, the Saudi Central Bank and Saudi Capital Market Authority launched Fintech Saudi in 2018.

Digitalization supports the Kingdom’s growing fintech startups and regulators.

Saudi Arabia supports entrepreneurship and promotes financial technology as part of its Vision 2030 investment plan.

Nejoud Almulaik, director of Saudi Fintech, said the organization does not see itself as a technology incubator.

Incubating new businesses and fostering the industry’s growth is what it does instead.

According to a Saudi Fintech survey, 93 percent of respondents prefer to bank online. Saudi Fintech, according to Almulaik, is responsible for supporting this landscape. 

The report says millennials, who range in age from 25 to 40, have a higher level of tech savvy and make more than 80 percent of their payments online. The strong technology infrastructure of the U.S. government influences them. 

Western Union bought a 15% stake in Stcpay for $200m in November, making it a unicorn – a privately-held startup valued at more than $1bn.  

Saudi unicorns are expected to be spotted soon, according to Almulaik. 

The team at Fintech Saudi plans a range of activities this year, including another Fintech Tour, following last November’s virtual event, which hosted 24 workshops, lectures, and panel discussions, making it the largest collection of fintech events in the Middle East. 

Saudi Arabia’s central bank and capital markets authority will also collaborate on a new fintech strategy, including talks with the Ministry of Education, the Ministry of Human Resources, and other agencies involved in data and cyber security.

In the next few months, Almulaik will announce new programs.

A survey of Fintech Saudis found that over 80 percent of respondents wanted easier digital payment systems. 

While digital investing and saving were listed as their top priority by between 60% and 20% of respondents.

Most of these types of apps and online systems, according to Almulaik, are currently being tested and will be licensed soon.

Although digital currencies have not been formally adopted in Saudi Arabia, Almulaik noted that the country is seeing an increase in the use of e-wallets. Money is reflected in the bank account as riyals and can also be withdrawn in cash.

She went on to say that central banks are still working on developing digital currencies as central bank digital currencies and that testing is now underway.

According to Almulaik, G20 central banks are actively working on how digital currencies fit into their economies. Saudi Arabia is a part of that process.

Digital identity is a recognized pillar of empowerment for financial technology in the fintech strategy, said the director. She said digital identity applications developed during the pandemic, such as Tawakkalna and the Absher government services app, indicate Saudi Arabia is doing well in the area.

Saudi Arabia, according to Mulaik, is an open market that welcomes international firms that want to set up shop there, and investors interested in its fintech sector are welcome.

She added that most fintech companies are locally headquartered in Saudi Arabia, with 80 percent having local headquarters, whereas 20 percent had local and international investments.

1. Sary

As sales of essential goods rise due to the Coronavirus outbreak, Saudi Arabia’s Sary marketplace has secured financial backing for expansion.

The government plans to boost SME contribution to GDP from 20% to 35% by 2030 under ambitious reform initiatives led by Crown Prince Mohammed bin Salman to diversify the economy away from oil.

As people increasingly rely on online apps under curfews and lockdowns in many cities, young Saudis have started small businesses backed by new technologies and digital infrastructure. Many of these businesses are flourishing now.

Mohammed Aldossary, chief executive of Sary, said the startup has three hubs in Dammam and Jeddah and will open a third in Riyadh, spreading to 25 cities in the kingdom as it uses the Series A funding. Early-stage venture capital firm Raed Ventures led the fund.

In a phone interview with Reuters, Aldossary explained that many medium-sized companies and supermarket chains had adopted his technology, although he mainly targets micro-and small businesses.

As a company, we made 50% more sales in March than we did in 2019. We expect to do 1 billion riyals this year, thanks to the surge in retail sales.

Saudi Arabia has closed malls, restaurants, coffee shops, and other public spaces as part of efforts to combat the virus. This has encouraged large retailers to conduct online business.

In Saudi Arabia, B2B logistics can be greatly improved, particularly for traditional FMCG retailers, who account for half of the 41 billion USD annual food GMV. However, offline sourcing is disjointed, with rigid delivery times and frequently volatile costs. 

For conventional merchants, transactions are cash-based, and inventory management and accounting are done with minimum technology. As a result, inefficiencies cost a lot of money when they arise in one of the most important businesses. Not only that, but merchants lack the order volumes required to unlock quantity discounts, inventory forecasting skills, and the room needed to store products in the same manner that larger supermarkets do.

It results in a lot of phone calls, manual account books, and massive inefficiencies resulting from ad-hoc procurement. Additionally, the COVID-19 epidemic stressed that the lack of digitization in such an important and notoriously opaque market had a major impact on consumers, including limited SKU availability, delayed procurement, and increased handling and processing and delivery costs. 

Sary is a B2B marketplace that uses its web and mobile platforms to link retailers with a broad network of FMCG wholesalers, suppliers, and manufacturers. Sary’s innovative approach aids in the digitization of the whole supply chain. It also enables merchants to get the best bargains, anticipate inventories, use various other digital services and provide suppliers and manufacturers with access and visibility to retailers.

Sary is increasing the efficiency of one of the largest sectors in the economy by digitizing supply and demand along the supermarket value chain, benefiting both business actors and end consumers.

As a result of Sary’s performance, achievements, and, most importantly vision, we are confident in the unique position they hold and their ability to redefine retailer-supplier relationships. In addition to the infrastructure and network Sary has developed, the company is working on introducing and integrating further financial and digital solutions that will enable it to reinvent and fully own wholesale supply chains across multiple retail industry verticals.

Sary’s co-founders Khaled Alsiari and Mohammed AlDossary are very nice people. We have been very impressed with how the team has navigated the COVID-19 pandemic, created a solid product, and helped the company to move 4 million tons of goods across the country during our engagement. So in addition to being excited to be along for the ride, we are most pleased to see this talented team lead the company closer to being the go-to platform for both sides of the retail market.

Company overview

2. Tamara

Tamara, a platform that enables customers to buy now and pay later, has raised $110 million in funding and plans to expand its operations in the GCC.

The news comes just six months after Riyadh-based Tamara launched in September last year, securing the largest Series A round in the Middle East and North Africa (MENA).

As part of the Saudi Central Bank’s Sandbox fintech development program, Tamara was the first BNPL firm founded by Abdulmajeed Alsukhan, Turki Bin Zarah, and Abdulmohsen Albabtain.

Tamara allows customers to buy goods and services and pay for them over 30 days or in three installments over two months.

Namshi, Floward, SACO, Nice One, Whites, and Nejree are among the 1000 merchants that have signed up for the platform. As a result, its user base and transaction volumes have grown by 180 and 170 percent, respectively, month over month, demonstrating healthy growth rates.

“Tamara was destined to make a difference. Payment solutions that are transparent and customer-oriented are needed in the area and worldwide. In a press statement, Abdulmajeed Alsukhan, Tamara’s co-founder and CEO, said, “At Tamara, we provide our clients an alternative to credit cards and Cash on Delivery (COD), which enriches their shopping experience.” Tamara has offices in the UAE and Saudi Arabia and Vietnam and Germany.

Company overview

3. Red Sea Farms

Investing arm of Saudi Aramco, Wa’ed, and other investors have provided $10 million to Red Sea Farms, an agritech startup in Saudi Arabia.

A press release from Wa’ ed, a five-year-old startup, stated joining forces with the King Abdullah University of Science, Future Investment Initiative Institute and Technology (KAUST), and Global Ventures.

The investment is one of the largest agritech in the Middle East region.

Red Sea Farms will use this money to build and retrofit commercial farming operations in Saudi Arabia’s central and western regions, which runs a greenhouse facility at the KAUST Research Technology Park.

Red Sea Farms, one of the few companies to use salt water to cultivate local produce to reduce carbon emissions and food scarcity, was founded in 2018 by Mark Tester and Ryan Lefers.

The startup claims its growing system consumes 85 to 90% less freshwater. “Saltwater takes the place of freshwater that is normally used to cool greenhouses and irrigate crops using a patented system of solar and growth monitoring technologies,” the company said.

As part of Aramco’s loan program, Wa’ed, the company provides loans to entrepreneurs. Also within Wa’ed is a venture capital arm that manages investments totaling more than $200 million in more than 30 kingdom-based companies.

Five years after initially backing FalconViz, Wa’ ed announced last week that it had invested $500,000 in the company.

Wa’ed has agreed to increase venture capital investment for Saudi startups in the early- and growth stages as part of the agreement.

In addition to the agreement with Falak, similar deals were signed with Oqal, Taiba Valley Companies, and Namaa Almunawara in December last year.

Saudi Arabia-based Wa’ed Ventures, through which it invests in startups, is the largest and most active private equity firm in Saudi Arabia. In addition, it is the only lender to startups in Kuwait without collateral, thanks to its loan financing arm.

The investment portfolio of Wa’ed Group includes Golden Scent, a Saudi beauty e-commerce site, and Ynmo, the Middle East’s first Arabic-language educational software for children with disabilities.

Wa’ed Ventures made a second investment in May in Hazen.ai, a traffic analytics and monitoring startup built on artificial intelligence.

Company overview

4. Gathern

Today, Saudi Arabia’s leading venture capital firm STV has led a $6 million Series A round led by Riyadh-based peer-to-peer vacation rental marketplace Gathern. In addition to Vision Ventures, 500 Startups, Naef Sultan AlAthel, and ARG Limited, existing investors are also participating in this round. According to our records, this is the largest funding round for a Saudi woman-led startup. The seed round raised an undisclosed amount of money in 2018 for Gathern.

Gathern began as a chalet booking website, allowing customers to rent chalets across Saudi Arabia, founded in 2016 by Latifa Altamimi and Faisal Alanazi. It developed into various types of homes, eventually becoming a peer-to-peer vacation rental marketplace with locations in over 100 Saudi cities, including Jeddah, Al-Ula, Riyadh, Dammam, Al-Baha, Abha, Taif, and Umluj. They can use it to book rooms, apartments, villas, resorts, camps, farms, and boats for short stays in addition to chalets.

The Saudi startup said that it is capable of hosting 1.2 million guests per month and that its top hosts earn more than $20,000 per month (SAR 60,000). In addition, there are numerous local and international online platforms offering vacation rentals in Saudi Arabia. Still, Gathern is the only one that has permission from the Saudi Ministry of Tourism to provide private vacation rentals. The Saudi Ministry granted this license to Gathrin last July. According to Kingdom law, property owners who rent out their properties for short-term rentals are normally required to obtain individual permits. However, using Gathern, property owners can list their property and host guests without the need for individual licenses.

As part of its efforts to diversify its revenue sources and minimize its reliance on oil exports, the Middle Eastern government invests billions of dollars in various tourism ventures. Gathern says it wants to welcome 100 million international and domestic visitors by 2030, which, if accomplished, could make it one of the top five tourist attractions in the world. The country currently welcomes millions of tourists each year for Hajj and Umrah. According to the statement, the recent introduction of a tourist visa is likely to expand the number of international travelers considerably.

Since COVID-19 has put an end to international travel in this country, for now, Gathern will have the opportunity to reap the benefits of the government’s focus on this industry once the recovery starts.

Gathern’s Co-Founder and CEO, Atifa Altamimi, said, “We are delighted to have existing investors, Vision Ventures and 500 Startups join us in our journey as we expand our proposition all across the country.”. The Saudi tourism sector is experiencing significant growth, both domestically and internationally.

“With Gathern, we hope to provide a unique visitor experience from actual residents instead of the usual tourism experience.” This allows everyone to learn about Saudi Arabia’s actual culture and cities. You list your apartment, villa, farm, room, camp, caravan, chalet, or yacht as a host on our platform, and you can earn significant additional revenue,” she added.

“We are tremendously delighted to collaborate with Gathern – it is our first investment in the travel market and the largest ever investment in a female-led Saudi business,” said Ahmad Alshammari, a Partner at STV. We believe Latifa and the Gathern team have the proper engine to take a fresh approach to this fast-growing market.  Despite the global challenges, COVID-19 attendees proved extremely nimble and resilient. I look forward to what lies ahead.”

Company overview

5. unifonic

GITEX is the Middle East’s largest tech event, so Saudi cloud communications company unifonic decided to launch the enhanced platform at the Middle East’s biggest tech event.

The platform’s main advantage is the ability to transform traditional one-way conversations with customers into conversations that involve them interacting with them in a way that fits their preferences. Jamalon, the Middle East’s largest online bookstore, piloted the platform before its GITEX Technology Week debut.

The founder and CEO of unifonic, Ahmed Hamdan, praised the platform’s importance in the age of customer convenience and faster communication. They achieved a new level of customer engagement with this launch in the region. Businesses and customers can now communicate through their preferred channel or instant messaging application, enabling full engagement throughout the year. 

Company overview

6. Nana 

With Nana, you can shop online and get groceries delivered directly to your home. In Riyadh and Jeddah, the brand is known as Nana Express and Nana Hyper, and in Khobar and Dammam as Nana Hyper. It is expanding across Saudi Arabia with the help of various supermarkets and partners.

Nana recently debuted a new vision that aims to strengthen the company’s market position and drive its nationwide expansion. In addition to its new identity, Nana has also adopted a new logo incorporating an image of a camel which symbolizes the animal’s qualities like strength, endurance, patience, and reliable behavior.

Sami Alhelwah, founder and CEO of the company, reported at the launch of its new brand identity that it aims to become the daily companion of every household in the kingdom and become the industry leader in online shopping and delivery.

With its current market share of 13 percent, the company aims to capture 40 percent of the Saudi market by 2025, or USD900 million (SAR3,375,900,000).

Sami Alhelwah, founder and CEO of Nana, further explained that the launch of their new brand identity marks a beginning in their transformation and the accomplishment of developing, modernizing, and upgrading an established local Saudi brand to grow into a promising global entity while remaining local.

Communication and Information Technology Commission (CITC) survey shows that 57 percent of the population used online shopping services in 2021, while the average monthly retail expenditure was SAR256. Most deliveries were of groceries, medicine, and medical products, followed by food and beverages.

Industry reports predict growth for online food delivery applications in Saudi Arabia to reach SAR11.9 billion in revenue by 2026; 15.9 million users are also expected to use online food delivery applications then.

Saed Al-Ali, VP of Marketing, noted that the upcoming launch marks a transitional phase and aims to simplify and ease people’s lives. Haytham AlQadi, Commercial Director at Nana, said that the company’s team of Saudis is outstanding. Hisham Al-Ali, Vice President of People, hails young Saudis as key players in enriching the culture and identity of Nana.

Company overview

7. Salla

Raed Ventures has led a seed round of funding for Saudi startup Salla, where Vision Ventures, Inspire Ventures and Direct Influence have also participated. Unlike most previous investments by these VCs, they did not disclose the size of this investment.

By enabling any Arabic ecommerce store to be set up online using the Salla platform and tools, Nawaf Hariri and Salman Butt founded Salla in 2016. Payments (gateway) and logistics partners of the startup handle the payments and deliveries, so store owners know they are ready to start selling when they go online.

It allows users to set up their branded store on their domain name by picking one of Salla’s available designs. 

Salla’s web and mobile apps for Android and iOS allow store owners to add and manage inventory.

Aside from offering a variety of reports and tools to help store owners, they also integrate Instagram, offer automatic invoices, a customer database, support blocking of customers, and allow store owners to pin favorite products on the homepage of their websites.

Salla does not charge store owners for every order they receive, unlike some other startups in the same field. Instead, it follows a freemium model, which means that the free version does not have all of the features of the paid subscriptions that cost 99 Saudi Riyals ($26) and 299 Saudi Riyals ($80).

The startup will use the investment to expand locally and regionally with the investment.

“E-commerce is growing tremendously, especially in Saudi Arabia,” said Nawaf Hariri, founder of the basket platform. Our aim at Salla is to make the process of merchants across the country easier by providing the latest technology. There are over thirty services that we offer to merchants. In addition, some families are using Salla to sell food online using Salla’s services, including individuals and businesses of all types.”

Eight thousand store owners are currently using Salla to facilitate transactions worth more than 10 million Saudi Riyals ($2.6 million) since the company was founded.

Zid, another Saudi startup, does pretty well in the same category, but they charge the retailers for every order.

In contrast, Salla’s subscription model is freemium, so they should do well here. In addition to empowering many people to set up their online stores, it also became the most important part of Salla’s sales funnels.

Company overview

8. Jahez

At RiseUp Summit on Saturday, Riyadh-based food shipping startup Jahez’s CEO revealed plans for an IPO next year. In response to whether Jahez could potentially partner with Delivery Hero in the future or prefer to remain independent, Jahez’s CEO said this. Multiple players cannot coexist in the Saudi market alone, he said.

Among the Middle East, North Africa, and Turkey’s food delivery companies, Delivery Hero has been the largest buyer. Many food delivery brands are owned by the German company, most of which have been acquired directly or indirectly due to acquisitions. A 63 percent stake is held by HungerStation, Saudi Arabia’s leading food delivery company. 

As part of plans to list the company on Tadawul (Saudi Stock Exchange), Jahez founder Ghassab AlMandeel said they plan to grow their company to become one of the largest food delivery specialists in Saudi Arabia. For a company to be able to list its shares on the stock exchange, Tadawul’s website states that the company’s market capitalization must be at least SAR 300 million ($80 million). Also, it should be profitable (unless it lists on Numu, which has fewer requirements).

Jahez raised the largest-ever financing round for a Saudi startup only six months ago. They sold primary as well as secondary shares in the transaction. Jahez received an unknown amount of money. In its October 2016 statement, the startup predicted it would reach a SAR 1 billion order value by 2020. They could generate tens of millions in revenue.

Ghassab also discussed company development plans, hinting that some of them could launch in 2021, saying that the company is eyeing multiple markets in the GCC. Cloud kitchens and quick commerce are also being launched by the company, he said. Restaurants will benefit from the cloud kitchens, he said.

He stated that they have already reached the goals they initially planned for by 2024, as he did not provide further details. He said that orders, software downloads, and customers served have increased multi-fold in the past few years.

It will be a milestone in the Saudi startup ecosystem if Jahez does indeed move forward with its planned IPO. It would be the first publicly traded Saudi company.

Company overview

9. PayTabs

According to LATTICE80, Abdulaziz Al Jouf, the CEO and founder of Paytabs, is the Middle East’s most appropriate financial expert to know and follow in fintech.

London is the headquarters of LATTICE80, a global fintech nexus. LATTICE80 created a list of key Middle Eastern fintech influencers to provide access to the latest information for the global fintech community. These are the emerging industry themes to watch out for and learn more about.

Unnamed investors have invested $20 million in Saudi payments startup PayTabs. This startup was founded in 2014 by Abdulaziz F. Al Jouf. India is the startup’s second largest market.

More than 12,000 customers currently use the company’s different products in India and the Philippines, among other countries.

MENA, Southeast Asia, India, Africa, and Europe are among those where it plans to expand in the next two years with the funding. They will also include acquisitions and product development in the financing. A total of 4,000 direct and indirect jobs are also expected to be created in the next two years.

“Infinite possibilities are our mission. Abdulaziz F. Al Jouf, Founder & CEO of PayTabs, said PayTabs provides secure and flexible financial solutions for small and medium businesses and large corporations.

Aramco Entrepreneurship Ventures (Wa’ed) made an undisclosed investment in PayTabs in 2014.

Top spot on the hallmark list was awarded to Abdulaziz Al Jouf, 38, and over 50 other CEOs. Al Jouf was always humble upon hearing of the achievement and graciously replied, “I’m greatly honored to receive this remarkable recognition from LATTICE80.”. PayTabs has now been in operation for four years, but they didn’t achieve success instantly. In honor of this honor, I wish to thank our team, our valued customers, and merchants worldwide. We are grateful for your commitment, support, and dedication. You deserve this!”

AA (as he is affectionately known) is both intelligent and inspiring, such as his never-ending determination, according to Huda Al Mousa, deputy branch manager of the PayTabs KSA office. He enables others to change negative sentiments into positive ones using his positive outlook.

Company overview

10. Zid 

Riyadh-based startup Zid, which offers Shopify-like eCommerce management services that let people create online shops, announced yesterday it had raised $2 million in pre-Series A funding. MSA Capital, Kuwait’s Arzan VC, and some angel investors participated in the round. The round was led by the venture arm of Elm, a leading Saudi technology firm.

Zid enables people to create and manage their online stores without having any technical knowledge through Zid’s mobile and web apps, founded in 2017 by Mazen AlDarrab, a serial entrepreneur who has founded and led several companies before. Besides offering pre-integrated e-commerce-in-a-box with delivery and payments from over 20 partners (at discounted rates), the solution also gives services (at discounted rates) that they can seamlessly integrate into any store.

Zid’s website states that store owners can also receive discounts on photography, packaging, logistics, design, marketing, and even shared workspaces.

The startup uses a freemium subscription model, allowing users to make up to 100 products and set up their virtual stores for free. People can subscribe to have unlimited effects in their stores by paying a monthly subscription of 100 SAR (USD 27) or 400 SAR (USD 107).

Zid also educates its users via its Academy initiative on a range of subjects related to eCommerce to assist them in running and managing their websites. Zid Academy offers online courses, offline meetups, and mentoring sessions.

Zid claims to have over 1200 active retailers on its website. With over SAR 140 million (USD 37.3 million) in sales, the startup claims to have experienced a five-fold increase in online orders.

According to Mazen AlDarrab, the founder of Zid, e-commerce continues to grow daily, not just in Saudi Arabia but also across the region. Zid was founded with one simple goal: to give retailers the whole shopping experience in a box to help them capture e-commerce opportunities.

According to Sultan AlAsmi, Zid’s CEO and co-founder, the company is committed to redefining the retail industry through digital solutions. According to us, retail needs disruption in the region. Because of the company’s 5-fold growth each year and the rapid growth in e-commerce adoption we’re experiencing, we’re uniquely positioned to lead this revolution.”

The startup, which employs 15 people, plans to expand into new geographical markets and attract new segments in the retail industry soon.

With fourteen months to go, it becomes the third regional startup to raise funding in this space. In May last year, an undisclosed sum was invested in Saudi startup Salla, and Lebanese startup Ecomz recently raised $4 million in Series A funding.

Company overview

edited and proofread by nikita sharma