Digitizing Payments: Kuwait's Ajar Online Gears Up To Take Its Platform To The Rest Of The GCC As anyone in the GCC can attest, paying rent in this region can often be a strenuous task for both landlords and tenants. Ajar Online is a platform offering a seamless and hassle-free way to digitize rent payment and collection.

As anyone in the GCC can attest, paying rent in this region can often be a strenuous task for both landlords and tenants. In Kuwait, where payment is commonly on a monthly basis, Shaheen Alkudhari found the process of paying either by cash, check or bank transfers, while chasing his landlord to collect his rent or receipt, or waiting for a long queue at the bank, to be rather a hassle.

And so, Alkudhari, who has a bachelor's degree in management information systems and a MBA from the American University of the Middle East, decided to look for a solution. Having worked for 10 years in fields as varied as logistics, real estate, finance and IT, he moved into an entrepreneurial career trajectory in early 2015, when he had the idea for Ajar Online, a platform offering a seamless and hassle-free way to digitize rent payment and collection.

To validate the idea, founder and CEO Alkudhari researched the real estate market, focusing on traditional methods of rent payments and property management, and concluded that both entities faced the same hurdles. Upon starting Ajar Online as a cloud-based rental payments service, the main challenge he faced was proving fintech solutions were more efficient than traditional methods of payment. "Changing the market's mindset [that have been embedded for] centuries, and converting them to automated methods was difficult," says Alkudhari, adding how customers in the region felt online payment solutions weren't secure.

The startup tackled this issue by taking measures to educate consumers on fintech solutions and the benefits of using the platform, plus offering a free trial to their services. Property owners could try it by managing multiple properties and rent collections anytime and anywhere on the platform, and set up monthly automatic payment notifications for their tenants on their desired due dates.

On the other hand, for tenants, the task of meeting up with landlords or going to the bank was reduced to simply receiving an SMS and email from Ajar Online, with a link to the platform's payment section that allowed them to pay through K-net -the retail payment system owned by several Kuwait banks- and receive the receipt after payment. Another hurdle the Ajar online team faced was finding the right workforce and partners, which they tackled by establishing a non-exclusive strategic partnership with Warba Bank, one of the well-known banks in Kuwait to streamline the payment process. Thanks to the partnership, customers felt more secure about the credibility of the startup, as it was now backed by a governmental and financial entity.

Launched officially in January 2016, the platform predominantly serves the Kuwait market, with representatives in the UAE and Saudi Arabia now preparing for their operations to start in 2018. A mobile app is in the works, as well as a second version of Ajar Online with enhanced offerings and tech for property management requirements. According to Alkudhari, the platform has seen positive growth on a monthly basis, and at times, the figures have even exceeded their forecasts.

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As of writing, they have more than 70 landlords/ real estate companies in Kuwait, and more than 4,200 tenants using the platform. Alkudhari asserts that Ajar Online's USP is that it is both an online payment solution and a property management platform. The company also provides white labelling on their platform, wherein startups can benefit and utilize their tech to implement for their customers based on their requirements. Users can use the property management platform for free, and the platform charges a transaction fee for the online rent payment to the property owners.

In October 2016, Ajar Online closed an undisclosed first round of funding from UAE-based VC firm BECO Capital, and again, in October this year, raised another undisclosed second round of funding from BECO Capital and Kuwait-based VC firm Sharq Ventures. Alkudhari commends their investors as being "part of the backbone of our company," with the Ajar Online team utilizing their backers' experiences and networks to scale their enterprise further.

In the next few months, the team plans to "strengthen our presence by scaling globally with a focus in our region," with their latest version seeking to serve property owners globally. Alkudhari adds that the newly raised capital will be used to accelerate the company's growth in the region by upgrading its services and tools for landlords to support expansion in UAE and KSA, as well as for increasing the size of the teams in the three different countries.

From a personal perspective, Alkudhari sees Ajar Online to be a part of a rather promising outlook for the fintech industry. Citing PwC's Global Fintech Report 2017, Alkudhari notes how its findings show that traditional financial entities such as banks, insurers and investment managers are expected to partner with more fintech companies in the next 3-5 years, and expect an average of 20% of ROI on their projects. "Many stakeholders that would have never approached technology solutions, are convinced to partner and support fintech companies today," he says. "Such opportunities enable us to scale quicker, create more networks, and eventually succeed."

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The Investor's Viewpoint

Yousef Hammad, Managing Partner, BECO Capital

What motivated BECO Capital to invest in Ajar Online?

"The problem Ajar is solving is extremely huge; rent payment makes up the biggest chunk of any consumer's monthly recurring expenses (RE). Ajar's plans to digitize the RE rental market is an extremely attractive value proposition. Shaheen and all of the Ajar team's skillsets, ethical standards and hard work made us very bullish about their ability to execute. The RE market in the region is massive and growing, given our population is mostly youth that will be looking for homes as they grow. In addition, the RE market when it comes to rental transaction, is completely offline, and ready to be digitized. Our research indicates a minimum of 2.6 million rental units in the GCC alone, the ability to digitize this market is massive."

As the first investment of BECO in a Kuwait-based company, what are your thoughts about Kuwait's fintech scene?

"The Kuwaiti ecosystem has already produced a number of successful startups and exits (Talabat, Carriage), and therefore the excitement in the ecosystem is strong, and the willingness to take risks is high. Unlike Dubai, Kuwait has very similar market dynamics to KSA, and therefore, the opportunity for Kuwaiti entrepreneurs to enter and win KSA, in my opinion, is higher than those of Dubai-based startups. Therefore, the opportunity to build a test market in Kuwait, and then to scale and win KSA is unique and very attractive."

Hamoud S Al-Sabah, Partner, Sharq Ventures

What motivated Sharq Ventures to invest in Ajar Online?

"Ajar Online is leading the new wave of property management solutions, using the next generation of technology to create tranquility for landlords and innovative customer experience for tenants. We've been watching Shaheen's activities since he was a student in business college, and his work in the private sector in Kuwait, and if he [continues to be] determined… things [will] start happening [continuing onwards as] a success story! Ajar will redefine the real estate sector in the MENA region."

'TREP TALK

Shaheen Alkudhari, founder and CEO, Ajar Online

What are your tips to starting up a business in MENA?

"Look for a problem that needs to be solved, build your prototype and validate your solution. Find the right investors who will support you [to] grow, and self-funding at the start is very likely, so make sure you have the budget for it. Listen to all the feedback from users, investors and all stakeholders, and make sure you work on your project accordingly when they have valid points. Know your competition. With a clear market research and SWOT analysis, you can identify your unique selling point. Be proactive, to make it easier to overcome any barrier and be ready for anything."

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