Zbooni, a technology start-up in the UAE that enables small and medium-sized enterprises to process payments and grow their online presence, secured $9.5 million in funding that will help fuel the company's regional expansion.
The Series A funding round began with an initial $5m closing from an undisclosed London-based institutional fund and has now incorporated a second tranche of $4.5m from regional and international investors, the company said on Tuesday.
Zbooni raised $1.1m in venture capital in 2019.
New and existing investors took part in the funding round. The company will use the new funding to hire new talent, develop proprietary technology, expand into new markets and cater to different customer segments, Zbooni said.
“This funding round welcomes new and existing investors to complement the business as it expands,” Ramy Assaf, chief executive and co-founder of Zbooni, said.
“We look forward to leveraging their depth of relevant first-hand expertise in building large-scale technology.”
Founded in 2016, Zbooni started as a chat commerce venture enabling payments through WhatsApp.
It provides services to a variety of businesses, with tools including invoicing technology, payment enablement, digital store creation and customer management support.
The technology platform supports about 4,000 SME clients and has allowed them to serve more than 150,000 end-customers thus far. Zbooni said it recorded a 600 per cent surge in its client base last year.
Start-ups in the Mena region raised $1.2 billion, or 64 per cent more funding, in the first half of 2021 compared to the previous year, according to data platform Magnitt. The UAE led the way in terms of deal numbers, with its start-ups securing 61 per cent of all Mena investments, the report found.
March Holding, a regional family office with interests in information and communication technology, e-commerce and payments infrastructure took part in the fundraising round. Enterprise Fund, a California-based VC and European private investors who have operated global payments and e-commerce businesses, also took part.
This funding round welcomes new and existing investors to complement the business as it expands
Ramy Assaf,
chief executive and co-founder, Zbooni
Chalhoub Group, an existing investor, also participated in this round through its CCVA investment arm, Zbooni said.
The start-up expanded its footprint this year with new hires and opened additional regional offices.
“What started as an innovative way of capturing business payments via messaging apps is evolving into a wider solution, built with a focus on being mobile and simple to use,” Mr Assaf said.
Zbooni, which was formed at a six-month Facebook-sponsored accelerator programme, is backed by regional and international organisations, including Chalhoub Group, Middle East Venture Partners and B&Y Venture Capital.
The platform connects merchants with customers by providing an easy way to complete a sale. Businesses just need to download the app, set up an account, list products they wish to sell, then share the link with customers through messaging platforms such as Whatsapp, Facebook Messenger or Instagram direct messages.
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Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
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Investment raised: $4 million
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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