UAE-Based Tabby Raises $200M In A Funding Round Led By Wellington Management
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Tabby, a buy now, pay later (BNPL) platform based in the UAE, has raised $200 million in a Series D funding round. The company closed this funding round at a $1.5 billion valuation.
Given its valuation, Tabby is now the first fintech unicorn in the MENA region. Wellington Management led the recent funding round. The other participating investors include Bluepool Capital, Mubadala Investment Capital, PayPal Venture, STL, and Arbor Ventures.
The funding round comes less than one year after Tabby raised $58 million in a Series C funding round led by STV and Sequoia Capital.
Tabby is one of the leading BNPL providers in the MENA region now because of its recent valuation. The funding round points to the shopping and financial services app’s significant growth and market importance.
Investors Show Interest In Tabby
The founder and CEO of Tabby, Hosam Arab, noted that the company had posted significant growth over the past year. Moreover, interest from investors had also increased, with the BNPL model posting more value despite challenges faced in other markets.
“We explored various discussions with interested parties, and many of the investors that came in already have exposure to this model in other markets. For us, it made sense to raise capital at this time. We do see this as potentially the last round of capital that we would raise before an IPO,” Arab said.
The CEO’s statement points towards Tabby’s profitability. The BNPL company has posted positive results in stark contrast to its peers globally. However, it is yet to reveal its profit numbers. Arab noted that Tabby had seen revenues increase threefold.
According to the executive, the company’s profitability comes from operating in a market where the structure aligns with the BNPL model’s economics.
Arab also said that the BNPL model succeeded in the MENA region because of its unique customer segment and clear regulations.
Fintechs Face Challenges Securing Funding
Tabby’s funding round comes as fintechs face challenges securing resources. Over the past one and a half years, fintechs have not raised significant funding and have also witnessed a significant drop in valuations as VCs feel the pinch of rising interest rates.
Fintechs, especially those offering buy now, pay later services to Western clients such as Affirm, Afterpay, and Klarna, have faced challenges accessing the private and public markets.
