In June 2021, after completing YC’s first cohort that year and securing $7.5 million in seed funding, Gina launched a fintech app for 20,000 retail customers, allowing them to send and receive money.
Three years later, the Dubai-based startup, which has expanded its services to meet the needs of small and medium-sized businesses in the UAE and now has 50,000 retail and business customers, has secured $22 million in Series A funding led by Altos Ventures.
Indeed, despite the global funding slowdown, this significant additional funding underscores investor confidence in the fintech company’s growth. The company claims that its customers have grown 34% month-on-month over the past year, and revenue has grown tenfold over the same period.
Co-founder and CEO Faisal Toukan told TechCrunch that Ziina has three factors that make it particularly interesting for investors: the UAE’s rapidly expanding SME sector, its focus on product-led growth, and its recently acquired central banking license.
Expanding the SME segment
Ziina was originally a peer-to-peer payments app for sharing expenses such as group travel or rentals. While the app gained traction with retail customers in the UAE, some business owners were looking to use digital wallets to send and receive payments, Toukan said.
In response, Ziina organically expanded its platform into two segments: Ziina Personal for splitting bills with friends, and Ziina Business for collecting payments. The first business feature allowed users to send payment links and receive payments via Apple Pay, Google Pay, MasterCard, and Visa.
As the demand from businesses grew, Ziina developed more products. A payment gateway (checkout) for online payments that integrates with platforms such as WooCommerce and Shopify, a POS (point of sale) solution for direct payments using QR codes, and payments via social media. In addition to these features, Ziina added CRM functionality so that businesses can track customer details and interactions.
While the YC-backed startup continues to offer P2P services, it’s clear why most of its product focus is now on SMEs. The startup is targeting an underserved market of 560,000 SMEs in the UAE, which account for more than 94% of all companies and contribute about 60% to the country’s GDP. As of 2023, about 77% of SMEs in the UAE are expected to adopt digital payments, driving demand for financial management tools.
“We have evolved from being a pure consumer app to an all-in-one platform for businesses to accept payments in the UAE, to an ecosystem that connects consumers and businesses on one platform for payments,” Toukan explained over the phone. “We look at the common experience of consumers paying businesses, businesses paying consumers, and building a network effect across both customer segments. And that’s one of the key differentiators in our product strategy and our business. So basically everything has to be part of one ecosystem where people have a partner they can trust financially.”
Product-centric growth
Ziina says from a product perspective, it addresses three key pain points for small businesses in the payments space: accessibility, cost transparency and user experience.
In terms of accessibility, fintech allows small businesses to open accounts and set up payment processors in minutes rather than weeks.
In terms of costs, Ziina says it offers simple pricing with no hidden fees: 2.6% + 1 AED (approximately $0.25) for each payment link and POS transaction, and 2.9% + 1 AED for each payment gateway transaction.
Finally, customers can track and adjust online and offline payments and payment links through the dashboard.
Ziina has grown rapidly in the past year, now serving 50,000 active users, including retail and business customers, whose business customers range from fashion and gaming to travel and tourism. Toukhan also told TechCrunch that the startup currently processes about 1,050 dirhams ($280) every 60 seconds, and expects annual volume to grow to 1.1 billion dirhams ($300 million), up from 550 million dirhams ($150 million) last year.
Gina’s growth has been largely driven by product-driven efforts, with no dedicated sales force. According to the CEO, 55% of customers are organic, with the rest coming from B2B referrals.
However, this is likely to change as it continues to expand and offer more financial services after receiving its banking license. The company is hiring its first sales force, including from Revolut.
Ziina claims to be the first venture-backed startup to receive a Stored Value Facility (SVF) license from the Central Bank of the UAE, which will allow the fintech to offer more financial solutions beyond lending, which requires a separate license, and for example, to earn float when customers store their assets on the platform.
Toukan believes that this license and the product’s financial ecosystem (the fintech will soon enter expense management with the launch of its card product, ZiiCard) give Ziina an advantage over other regional fintechs that offer overlapping financial services. For example, Paymob offers POS terminals, Tabby is expanding its financial products beyond buy now, pay later, Telda offers P2P payments, and Mamo is in the expense management business.
Despite the competition, the CEO, who founded the fintech with Sarah Toukan and Andrew Gold, sees ample market potential for Ziina in the fast-growing payments sector, targeting consumers and businesses across the MENA region.
“The Middle East seems to be growing very strongly, especially in terms of GDP growth, and the UAE is one of the leaders in that space,” the CEO said. “If we do our job well, which we very much expect at Ziina, then in four years we could have 200,000 monthly active businesses on the platform, as SMEs in the UAE emerge. And if you look at players like Nubank in Brazil, they’ve achieved their goal of 10-20% market penetration. So we want to do that and be the Nubank of the region.”
The Series A round also saw participation from Activant Capital, Avenir Growth, Fintech Collective, FJ Labs, Jabba Internet Group, Middle East Venture Partners, and Y Combinator. This brings Ziina’s total venture funding to over $30 million since its founding in 2020.
