Saudi FinTech start-up Tamara gains unicorn status after latest funding round

Saudi Arabia's buy now, pay later platform Tamara reached a valuation of $1 billion in its latest equity funding round after raising $340 million.

The series C round was jointly led by SNB Capital, a unit of the kingdom’s largest bank, and Public Investment Fund-owned Sanabil Investments, the Saudi home-grown FinTech start-up said on Monday.

Other participants included Shorooq Partners, Pinnacle Capital and Impulse, who joined existing investors such as Coatue, Endeavor Catalyst and Checkout.com.

Tamara plans to use the money it raised to fund new products and services, going beyond BNPL to take advantage of opportunities in shopping, payments and banking services in Saudi Arabia and across the GCC, it said.

Start-ups that reach a valuation of $1 billion are called unicorns and Tamara said reaching this milestone was a "significant opportunity" in a financial services market that is "underpenetrated and underserved".

Tamara intends to become "the next big giant in shopping, payments and banking", said Abdulmajeed Alsukhan, co-founder and chief executive of Tamara.

The UAE, Saudi Arabia and Egypt are the three biggest markets for venture capital in the Mena region, having attracted $4.48 billion, $1.94 billion and $1.46 billion, respectively, from 2018 to 2022, start-up data platform Magnitt said in November.

In the first nine months of the year, invested capital across the five most-funded venture markets in the Mena region dropped by 43 per cent, Magnitt said in a report in October.

Saudi Arabia attracted $536 million in investment, which was 41 per cent less than the same nine-month period last year, the report showed.

Tamara is considering a listing in Saudi Arabia in the future, with the possibility of a second listing in other markets, its chief executive told The National in August.

Tamara's latest equity funding round round comes after a debt-raising move last month led by Goldman Sachs and Shorooq Partners.

The company operates in Saudi Arabia, UAE and Kuwait. It has more than 10 million users and more than 30,000 partner merchants.

Established in late 2020, it was started by three Saudi co-founders – Mr Alsukhan, Turki bin Zarah and Abdulmohsen Al Babtain – after receiving a Saudi Central Bank permit to provide BNPL services.

Mubadala-backed BNPL platform Tabby also achieved unicorn status after it raised $200 million in a series D funding round, it said in November.

With a valuation of more than $1.5 billion, Tabby joined the UAE's Careem, Kitopi, Swvl and Emerging Markets Property Group, Saudi Arabia's STC Pay and Egypt's Fawry on the list of regional unicorns.