Exploring the Rise of Revenue-Based Financing in the MENA Region: CredibleX Leads the Way
In today’s challenging venture capital landscape, many companies are seeking alternative funding routes. One standout option is Revenue-Based Financing (RBF), which has gained significant traction among startups, particularly in the MENA region. Among these emerging companies is CredibleX, which recently secured a $55 million Seed round led by Abu Dhabi-based Further Ventures, aiming to capitalize on the growing demand for revenue financing in the Middle East.
CredibleX is carving out its niche by providing working capital to small and medium-sized enterprises (SMEs) in a market where traditional banking channels fall short. The MENA region has witnessed similar success stories, such as FlapKap and Flow48, which have also scaled and raised capital in 2023. Globally, players like Modifi ($353.6 million), Drip Capital ($528.1 million), and IncomLend ($25 million) further highlight the trend.
- FlapKap and Flow48: MENA-based competitors scaling rapidly
- Modifi: Raised $353.6 million globally
- Drip Capital: Secured $528.1 million to date
- IncomLend: Raised $25 million globally
“We believe this approach helps us in recovering repayments easily as we have a direct relationship with the debtor/payer,”
— Anand Nagaraj, CEO and Cofounder of CredibleX
CredibleX has tailored its platform to meet the specific needs of SMEs in wealthier countries like the UAE, where accessing Development Finance Institutions is more challenging. Their innovative approach involves partnering with large aggregators to reach SMEs within their ecosystem.
A practical example illustrates CredibleX’s model: A restaurant using Talabat for deliveries can apply for RBF directly through an integrated platform with CredibleX. By uploading sales data, the restaurant can receive a credit decision within 24 hours. Repayments are managed seamlessly through Talabat, demonstrating CredibleX’s strategic partnerships with 37 similar platforms.
Since launching operations in March 2024, CredibleX has disbursed over AED 100 Mn (US$27Mn) to SMEs. The leadership team includes Anand Nagaraj, formerly of Citi and Invoice Bazaar, alongside cofounders Ahmad Malik and Hassan Reda. Their combined expertise has been pivotal in navigating regulatory landscapes like FSRA at Abu Dhabi Global Markets.
The Seed round combines equity from Further Ventures and debt from providers such as Kilgour Williams Capital, with backing from ADQ and Mastercard among others.
