{"id":635839,"date":"2024-09-11T11:00:00","date_gmt":"2024-09-11T08:00:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/paymob-started-by-three-college-friends-lands-another-22-million-and-is-profitable-in-egypt\/"},"modified":"2024-09-11T11:00:00","modified_gmt":"2024-09-11T08:00:00","slug":"paymob-started-by-three-college-friends-lands-another-22-million-and-is-profitable-in-egypt","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/paymob-started-by-three-college-friends-lands-another-22-million-and-is-profitable-in-egypt\/","title":{"rendered":"#Paymob, started by three college friends, lands another $22 million and is profitable in Egypt"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3e07cc334bf\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3e07cc334bf\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/paymob-started-by-three-college-friends-lands-another-22-million-and-is-profitable-in-egypt\/#Cross-selling_services_to_a_growing_merchant_base\" >Cross-selling services to a growing merchant base<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/paymob-started-by-three-college-friends-lands-another-22-million-and-is-profitable-in-egypt\/#Rapid_adoption_of_online_payments_in_the_UAE\" >Rapid adoption of online payments in the UAE<\/a><\/li><\/ul><\/nav><\/div>\n<div>\n<p id=\"speakable-summary\" class=\"wp-block-paragraph\">Not many ecosystems outside of Silicon Valley can boast successful tech startups launched by founders while still in school or shortly after dropping out. So, when such events occur in regions like the Middle East or Africa, the companies are worth paying attention to.\u00a0<\/p>\n<p class=\"wp-block-paragraph\">A decade ago, <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.linkedin.com\/in\/islam-shawky-993306265\/?originalSubdomain=eg\">Islam Shawky<\/a>, <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.linkedin.com\/in\/alainelhajj\/?original_referer=https%3A%2F%2Fwww%2Egoogle%2Ecom%2F&amp;originalSubdomain=eg\">Alain El Hajj<\/a>, and <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.linkedin.com\/in\/mostafa-menessy?originalSubdomain=eg\">Mostafa Menessy<\/a>, three undergraduates from the American University in Cairo, launched an e-commerce platform in Egypt. At the time, e-commerce was an extremely nascent industry in which only 2% of households in the country participated. One big reason was a lack of online payment methods.<\/p>\n<p class=\"wp-block-paragraph\">\u201cThere was a gap between what banks were offering and the financial <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/technology\/\" data-internallinksmanager029f6b8e52c=\"4\" title=\"Technology\" target=\"_blank\" rel=\"noopener\">technology<\/a> requirements of new business models. No one had been tackling digital payments for e-commerce and digital native startups,\u201d Shawky said in a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.entrepreneur.com\/en-ae\/growth-strategies\/driving-change-paymob-co-founder-and-ceo-islam-shawky-is\/438670#:~:text=%22There%20was%20a%20gap%20between,commerce%20and%20digital%20native%20startups.%22\">2022 interview<\/a>.\u00a0<\/p>\n<p class=\"wp-block-paragraph\">Integrating a payment gateway from local banks with their e-commerce platform was a hassle, so Shawky and his friends launched <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/paymob.com\/\">Paymob<\/a> as a payment infrastructure for digital wallets in 2015 while still in college. What began as a small venture has quickly evolved into an omnichannel gateway offering over 50 payment methods, including wallets, cards, buy now pay later (BNPL), and QR payments, enabling 350,000+ merchants across five countries in the Middle East and North Africa to accept online and offline payments.<\/p>\n<p class=\"wp-block-paragraph\">So far, Paymob, which describes itself as a financial services enabler, has raised over $90 million to scale up to this point, including a recently closed $22 million extension to its <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/watch-movies-tv-seriess\/\" data-internallinksmanager029f6b8e52c=\"8\" title=\"Watch Movies &amp; TV Series\" target=\"_blank\" rel=\"noopener\">Series<\/a> B round led by EBRD Venture Capital. That brings its total Series B raise to $72 million.<\/p>\n<h2 class=\"wp-block-heading\" id=\"h-cross-selling-services-to-a-growing-merchant-base\"><span class=\"ez-toc-section\" id=\"Cross-selling_services_to_a_growing_merchant_base\"><\/span>Cross-selling services to a growing merchant base<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p class=\"wp-block-paragraph\">When we last covered Paymob in 2022, the fintech served just over 100,000 local and international merchants. It has more than <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/trip-and-travel\/\" data-internallinksmanager029f6b8e52c=\"10\" title=\"Trip &amp; Travel\" target=\"_blank\" rel=\"noopener\">trip<\/a>led that number in the two years following its expansion from Egypt and Pakistan into Oman, Saudi Arabia, and the UAE.<\/p>\n<p class=\"wp-block-paragraph\">Paymob\u2019s initial $50 million Series B round in 2022, co-led by PayPal Ventures, which participated in the extension round, spurred this expansion. Within this period, the fintech also improved its product suite, CEO Shawky told TechCrunch on a call. It launched an <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a> for small and medium businesses (SMBs) and introduced payment methods like embedded checkout experiences and products like lending and advanced settlements.\u00a0<\/p>\n<p class=\"wp-block-paragraph\">\u201cWe help businessees accept, pay, manage and grow, that\u2019s the four divisions that we have. Acceptance is the engine and the core business and we cross-sell everything based on it,\u201d Shawky explains. \u201cAfter onboarding merchants, we help them accept digital transactions, and then step by step, help with payables, provide working capital, and give them tools to manage their finances and businesses better.\u201d<\/p>\n<p class=\"wp-block-paragraph\">Paymob became profitable in Egypt for the first time in the second quarter of this year, where its revenues have grown sixfold since mid-2022. It\u2019s still not profitable in other countries.<\/p>\n<p class=\"wp-block-paragraph\">Increasing its merchant number and boosting the average revenue per merchant by cross-selling additional services has contributed heavily to the startup\u2019s success so far. For example, if a Paymob customer only has a POS terminal that accepts cards, that covers just 10-15% of their business. By offering a suite of products through partnerships with Shopify and Tabby, Paymob\u2019s margins have improved significantly. Doing this at scale, digitally, and without needing a massive salesforce likely drove efficient growth (Paymob has a little over 1,000 employees).\u00a0<\/p>\n<p class=\"wp-block-paragraph\">\u201cWhat we\u2019re most excited about is that we\u2019ve managed to grow profitably because in the past two years, a lot of people were saying, we had to stop growing in order to reach profitability or to conserve runway,\u201d remarked Shawky. \u201cBut we\u2019ve showcased that if you build a fundamentally sound business and actually address a client\u2019s need, you can scale fast while reaching profitability.\u201d\u00a0<\/p>\n<h2 class=\"wp-block-heading\" id=\"h-rapid-adoption-of-online-payments-in-the-uae\"><span class=\"ez-toc-section\" id=\"Rapid_adoption_of_online_payments_in_the_UAE\"><\/span>Rapid adoption of online payments in the UAE<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p class=\"wp-block-paragraph\">Indeed, digital payment adoption is surging across Egypt and in the Gulf.<\/p>\n<p class=\"wp-block-paragraph\">In Egypt, 88% of consumers have used at least one emerging payment method in the past year, and 85% of SMEs recognize that accepting omnichannel digital payments is critical to their growth, according to Mastercard. Meanwhile, in the UAE, demand for digital payment methods is more pronounced, with around <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.mastercard.com\/news\/eemea\/en\/newsroom\/press-releases\/en\/2023\/september\/mastercard-sme-confidence-index-80-of-uae-smes-project-similar-or-increased-revenue-in-2023\/\">77% adoption nationwide<\/a>.<\/p>\n<p class=\"wp-block-paragraph\">Based on conversations with founders, it\u2019s clear that despite this strong demand, the market remains underserved. As such, fintechs that have expanded into the UAE, like Paymob and local players like Ziina, which we covered last week, are racing to fill the gap by offering tailored solutions to half a million merchants, tapping into the country\u2019s growing appetite for digital payments.<\/p>\n<p class=\"wp-block-paragraph\">As an illustration of this explosion in demand, Paymob offers only an online acceptance product in the UAE, yet in just 14 months, its transaction volume in the UAE has grown to match the size of its entire Egyptian business, which took five years to build. Reasons for that rapid growth in the Middle Eastern country include higher purchasing power, currency strength, and the larger share of digital wallets compared to cash usage.\u00a0<\/p>\n<p class=\"wp-block-paragraph\">Nevertheless, Egypt remains its largest market. Shawky is confident that fintech\u2019s suite of products, aimed at advancing a cashless society and combined with the government\u2019s and central bank\u2019s efforts, will help Egypt reach the same level of digital payment adoption seen in the UAE.<\/p>\n<p class=\"wp-block-paragraph\">\u201cIssuance and acceptance need to go hand in hand for Egypt\u2019s economy to reach this inflection point. The central bank has been making a lot of effort and investing in digital infrastructure in the country,\u201d remarked the CEO. \u201cWe\u2019re seeing the effects. Our business grew six times in two years and four months; yes, we\u2019ve been growing our merchant base, but it\u2019s also because these merchants are processing more digital volumes.\u201d<\/p>\n<p class=\"wp-block-paragraph\">Paymob reported a total payment volume of $5 billion in 2020 and facilitated over 120 million transactions that year. However, the current figures for both metrics remain unclear as the fintech has not disclosed updated numbers.<\/p>\n<p class=\"wp-block-paragraph\">In addition to PayPal Ventures, the fintech\u2019s Series B round welcomed participation from Endeavor Catalyst alongside existing investors British International Investment (BII), FMO, A15, Nclude and Helios Digital Ventures (HDV).\u00a0<\/p>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMN63nwsw68G3Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more like this article, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/technology\/\" target=\"_blank\" rel=\"noopener\">Technology<\/a><\/span> category.<\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/techcrunch.com\/2024\/09\/11\/paymob-lands-another-22-million-and-is-profitable-in-egypt\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Not many ecosystems outside of Silicon Valley can boast successful tech startups launched by founders while still in school or shortly after dropping out. So, when such events occur in regions like the Middle East or Africa, the companies are worth paying attention to.\u00a0 A decade ago, Islam Shawky, Alain El Hajj, and Mostafa Menessy,&#8230;<\/p>\n","protected":false},"author":1,"featured_media":635840,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/techcrunch.com\/wp-content\/uploads\/2024\/09\/DE5A8A1F-FB9E-4209-8A49-250D7C0C3AC2.jpeg?resize=1200,971","fifu_image_alt":"","footnotes":""},"categories":[18],"tags":[76556,25562,74839,151768],"class_list":["post-635839","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-fintech","tag-africa","tag-fundraising","tag-paymob"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/635839","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=635839"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/635839\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/635840"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=635839"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=635839"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=635839"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}