Latest analysis means that the e-commerce market in Saudi Arabia, UAE and Egypt account for a mixed $21.4 billion and is projected to develop by greater than 50% to $33.3 billion within the subsequent three years. And as MENA buyers enhance their commerce spending, it’s more and more changing into crucial for on-line shops to place themselves to take full benefit of the rising phenomenon.
FlapKap, utilizing its revenue-based financing platform (RBF), helps these shops clear up the growth-destructive challenges rising on-line shops encounter when attempting to satisfy buyer calls for. The corporate, which permits e-commerce companies to scale and develop by focusing on companies with restricted financial institution or enterprise financing entry, is saying that it has raised $3.6 million in seed funding to supercharge its efforts.
Ahmad Coucha and Khaled Nassef based FlapKap in 2022; Sherif Bichara and Adel Hodroj are on the founding group. It was throughout Coucha’s time at Kijamii, a digital company upstart he launched in 2014 that carried out tasks for Fortune 500 corporations, that the CEO observed late fee and entry to working capital points companies, together with his, confronted. For example, most of Kijamii’s purchasers at all times paid late, typically 30 to 120 days from when a sale closed.
“We at all times thought to ourselves that this ought to be the precise reverse. Huge purchasers with huge quantities of money shouldn’t be those that get tremendous versatile fee phrases from the businesses; it ought to be the small and medium enterprises struggling for money and development. These ought to be getting the assist,” CEO Coucha instructed TechCrunch.
In 2021, Coucha spent a while within the U.S. and witnessed the rise of revenue-based financing platforms within the nation and the West, together with Clearco and Wayflyer. The thought to copy the same operation for MENA popped up, therefore the launch of FlapKap. The corporate serves primarily SaaS and e-commerce platforms like most revenue-based financing corporations however has extra clientele on the previous than the latter.
E-commerce operations have versatile fee phrases that swimsuit FlapKap’s enterprise as they spend loads on promoting, advertising and stock, recurring actions liable for these manufacturers making late funds or taking loans to stay operational. “SaaS continues to be rising in its early stage within the Center East, but it surely’s not but sizable. Alternatively, e-commerce is booming in all components of the world, and is underserved by the present finance infrastructure within the Center East and Africa,” he added on his firm’s choice for e-commerce manufacturers in each areas.
FlapKap’s enterprise mannequin is one the place it funds e-commerce platforms’ expenditures and recoups its cash when these manufacturers pay again a share of their revenues till compensation is full. In different phrases, FlapKap provides a set payment — cut up to be paid in percentages from their revenues inside a particular timeframe — to no matter quantity its purchasers entry on its platform.
The revenue-based financing firm for e-commerce platforms, which claims to be rising 300% quarter over quarter, additionally talked about that it has partnered with tens of purchasers from Egypt and UAE in six months. Some embrace Dresscode, Uncooked African, Palma and Tam’s Shoemaker. FlapKap claims to have helped generate greater than an 85% enhance in income and over 70% enhance in web earnings for these prospects inside a couple of months.
FlapKap has additionally lately built-in its AI-based insights and monetary knowledge analytics with Shopify, WooCommerce, Fb and Google, and expects to strike extra partnerships, it stated in an announcement. “Other than the financing options we provide our companions, we additionally give them different value-added providers to assist them go additional. So we at all times prefer to place ourselves as a development companion; we’re not simply financing,” stated the chief government. “We wish to drive development for them. We’ve a work-in-progress mannequin constructed for figuring out the purchasers’ development potential; it’s a mannequin we’re at the moment constructing and getting enhanced by the info we’re accumulating.”
This newest capital injection comes six months after FlapKap’s pre-seed increase and the buyers on board are strategic for FlapKap. QED, for example, has invested in a few of FlapKap’s world counterparts, comparable to Wayflyer and Fairplay. The fintech-focused enterprise capital agency used Bolt, its arm for investments within the Center East, to finish the transaction. There’s additionally Egyptian government-backed Nclude, legacy Pan-African investor A15 and Outliers. “I’m excited to be constructing FlapKap together with them,” stated Coucha. “I feel they don’t seem to be simply buyers; they’re actual companions in what they’re doing for us now and anticipated to do sooner or later as nicely,” stated Coucha.
With the brand new funding, FlapKap plans to extend its capability to assist extra e-commerce companies within the MENA area scale and maximize their development potential, in addition to consolidate its place because the area’s main revenue-based financing participant. The corporate goals to solidify its presence in Saudi Arabia, the UAE and Egypt by providing e-commerce companies the flexibility to scale their stock and digital advertisements now, whereas flexibly paying later. Gbenga Ajayi, a companion at QED, commented on the funding: “Having invested and labored with comparable corporations to FlapKap throughout different areas comparable to Europe and Latin America, we’re assured this group can attain comparable success.”
