On The Fast Track: How Your Startup Can Succeed In The Middle East's Thriving Fintech Landscape As consumers become more digitally minded, so do businesses, provoking companies to innovate and deliver fintech solutions across industries such as banking, telecommunications, retail, and insurance.
By Ghady Rayess
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Fintech is not exactly a new industry- after all, technology, to some extent, has always been intrinsically connected to finance. From the introduction of credit cards to the onset of highfrequency trading platforms, technology has swiftly evolved over the years to serve the financial demands of both consumers and businesses in many ways.
Many factors have driven the growth of the fintech industry today, which include traditional payment providers adopting new technologies to improve end user experiences, the birth and speedy uptake of cryptocurrencies and blockchain, and the growth of machine learning and artificial intelligence to spot trends and risk. These factors, amongst others, have accelerated the advancement of the fintech industry, and it has been further amplified by the effects of the global coronavirus pandemic.
In a post-pandemic world, a digital experience is not only desired, but it is demanded. As consumers become more digitally minded, so do businesses, provoking companies to innovate and deliver fintech solutions across industries such as banking, telecommunications, retail, and insurance. In the Middle East, the burgeoning fintech market offers entrepreneurs profound potential for growth, growing rapidly at a compound annual growth rate of 30%. By the end of this year, it's predicted that over 800 fintech companies from sub-segments that include payments, open banking, smart lending, blockchain, and regtech, will raise over US$2 billion in venture capital funding in the region.
As fintech flourishes in the Middle East, we see the emergence of diverse entrepreneurs and SMEs in the field. Having co-founded a successful fintech company named FOO in this region, here are a few of my tips on how you can crack the fintech market in the UAE and beyond:
1/ IT'S ALL ABOUT EXPERIENCE When creating your fintech solution, creating an effective user experience (UX) should lie at the heart of everything you do. You can innovate to deliver the most advanced technology; however, it will fall flat if not supported by a remarkable user experience. A strong connection between the back-end technology and front-end user experience is necessary. It's striking this balance, the combination between innovative technology and an effective user interface and experience that enables the delivery of a successful solution. At FOO, we build all solutions in-house, using a diverse pool of talent, to ensure delivery on both fronts. Since our solutions are built on a modular platform, using microservices, we are able to achieve high quality with both technology and user experience.
2/ STAND OUT FROM THE CROWD True innovation is born as a solution to a problem, from solving a common challenge that people face. Identity your challenge, find your niche, and focus on creating an attractive value proposition that makes you unique. Entering the market with a strong differentiating factor is what will give you an edge in an increasingly saturated market. We started FOO with this in mind. Before the startup ecosystem really existed, my partner and I started coding from my grandmother's house, creating an app that provided digital solutions on the Nokia platform. This was before app downloads were monetized, pre-existing the creation of Apple or Android app stores.
Eventually, we pivoted to focus more heavily on fintech-related projects. This is when we were able to focus on building our differentiating factor. As we entered deeper into the digital space, we noticed that many fintech companies focus on functionality, rather than holistic, end-to-end experiences. We would use this insight to establish our edge- we became dedicated to ensuring that we could deliver the utmost quality on both functionality and design. This meant that clients no longer needed to seek out multiple providers to build a single solution; we could do it all in-house.
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3/ TIMING IS EVERYTHING As with most things in life, timing is key when breaking into the fintech market. Patience has a big role to play in entrepreneurship. There will be highs and lows, but what entrepreneurs must understand is that it's all part of the journey. For example, in the early stages of your business, growth and revenue may be hindered to ensure the best customer satisfaction. This sacrifice is vital to building brand reputation.
As the business gains momentum, it's important to be aware of when it's the right time to raise funds and go for it. Fintech entrepreneurs operating in Dubai are fortunate to have the corporate structure and flexibility offered by the city's business landscape. If leveraged at the right time, your fintech business has the potential for great growth. This has been the case with FOO- after moving our headquarters to the UAE and focusing on growth in the past few years, we are now planning to raise a Series B round of funding.
4/ INVEST IN RELATIONSHIPS The successful adoption of this advice can only be delivered and maintained by investing deeply in your team. Your employees are your biggest asset. Go that extra mile to ensure your team possesses robust industry know-how and a diverse skillset to deliver the best possible solution for your clients. Just as important as your team are the partnerships you forge. Particularly for SMEs, partnering with regional and international players provides the opportunity to accelerate growth.
Since the early days of FOO, we were able to form meaningful and mutually beneficial partnerships with leading companies like Nokia, Microsoft, Zain, Mastercard, and Visa. These partnerships played a key role in shaping our own company culture as we grew. Collaborating with successful partners will also give entrepreneurs and SMEs the chance to experience how larger companies operate and learn from their strategy, operations, and business models, and then use these lessons to focus on scalability both regionally and globally.
Fintech entrepreneurs in the Middle East are fortunate to be operating in such a dynamic market. Operating from the UAE, the heart of economic activity in the GCC, we at FOO have been able to benefit from the industry's natural growth, giving us access to a large talent pool as well as immense market potential. Going forward, we hope to delve further into the fintech industry in the Middle East, and keep supporting the ecosystem to thrive and grow.
