Saudi fintech is still attracting serious money. But investors are becoming much more selective. Tabby has just hit a $6.5 billion valuation while banks themselves are backing fintech infrastructure. Joining me at Money 20/20 is Fadi Al Awami, Financial and Business Adviser and Fintech Consultant at The Consultation Centre.
My pleasure and thanks for having me today.
Tabby just raised $233 million at $6.5 billion valuation. Are transaction value and profitability now what investors want to see?
Definitely the value of the transaction matters. But with respect to the business model — which is lending — another important factor is the quality of the portfolio. Tabby proved to have good profitability and a very good quality portfolio. And that is what makes investors really interested.
Overall startup funding fell sharply in H1 in Saudi, yet fintech captured about two thirds of the capital. Is that a downturn or the market separating durable businesses?
Fintech is one of the most attractive sectors investors are looking for because of the value it adds to the financial ecosystem and the scalability behind it. It always remains attractive for VCs and even for banks — regarding their expansion or different activities.
When banks like Riyad Bank, SAB, and GIB put their own capital into fintech infrastructure, what does that tell us?
That really gives us a sign that banks have moved from being enablers to investors. Not only because of the money they invest, but because of the capabilities and resources they bring. Having investment from banks definitely gives trust to the fintech ecosystem overall.
What is the most common mistake a good international fintech makes when entering Saudi Arabia?
Many companies planning to expand want to do it in phases — explore the market first through an agent or partner. I do not agree with this approach. Saudi Arabia is a big market and strong economy. When you come here, you really have to invest — to show potential clients that you are already here and not just wanting to explore. You have to be ready from the beginning to invest as what is expected from the client side.
For a company coming to Saudi Arabia today — what is the right sequence?
The most important thing is to understand the regulatory framework first. After that, you need locals — either as partners or as leaders in your business. You cannot just come alone and try to grow the market, because the dynamics here are different. And then capital — to acquire clients and show your potential clients that you are here with a full setup, ready to support them.
Thank you very much, Fadi.
Thanks again. Always happy to be with Fintech TV.
