Funding Souq raises $2.5M in seed funding

Blog Author
Funding Souq Editorial Team
Tech Writer
Mar 01, 2022
Funding Souq’s editorial team comprises experienced finance and investment professionals that are on a mission to fuel SME growth, create jobs, and drive the economy forward. They aim to share their extensive experience and industry know-how to empower entrepreneurs and investors alike.
Mar 01, 2022

Saudi Arabia-based crowdfunding platform Funding Souq has closed a $2.5m seed round with contributions from an arsenal of angel investors including Amal Dokhan (Partner at 500 Global), Omar Aljeraisi, Christian Kunz (Head of Strategy at a leading Global Financial Centre). Existing investors include Mazin Alzaidi (Partner at STV ), Musaab Hakami and IslamicFinanceGuru.

Founded in 2020, Funding Souq is a platform that connects investors with established SMEs who are looking to borrow between $20k-150k. Investors get exposure to SME lending and realize an Internal Rate of Return (IRR) of c.20% whilst supporting their local businesses and making an impact

Lack of SME finance

"SMEs in the GCC are highly underserved by financial institutions and often don’t qualify for the financing they deserve as traditional lenders are overly conservative. According to the IMF, only 2% of GCC lending goes to SMEs as opposed to 22% in other high income countries which in turn strains the regional economy. This lack of financing limits economic growth and is one of the main reasons why we started Funding Souq. We are incredibly proud to have financed 47 SMEs across Saudi Arabia and UAE in the first 12 months of operations and are looking forward to growing our portfolio exponentially”, says Martin Jaouni, Funding Souq’s CEO.

Once onboarded, retail and institutional investors can choose to invest in individual businesses or a portfolio of businesses to diversify their exposure and maximize their risk adjusted return. In December 2021, Funding Souq financed  a portfolio of 25 businesses which is on track to generate an IRR of 22% for the investors that participated. More than 60% of those investors are repeat investors. 

Funding Souq uses a robust credit scoring process that analyzes tens of variables before shortlisting a business for an enhanced due diligence.Less than 9% of the businesses that apply get approved on Funding Souq . This disciplined approach to credit risk has helped us maintain defaults impressively at less than 1%. 

Plans to launch new products

With this round of investment, Funding Souq will scale its operations and aim to grow its debt investor partnerships with family offices and banks to focus on Sharia-compliant financing. The company is also exploring entering new markets and developing new products that will further serve its mission to empower SMEs in the Middle East and beyond. 

Related Articles

The Saudi Central Bank Grants License to Funding Souq for Debt Crowdfunding Platform Operations in the Kingdom

Apr 12, 2024
The Saudi Central Bank, also known as SAMA, has issued a license to Funding Souq, a debt crowdfunding platform, allowing it to operate within the Kingdom of Saudi Arabia. This anno

Funding Souq Partners with Qoyod to debut Embedded Financing to SMEs

Mar 12, 2024
Funding Souq is thrilled to partner up with Qoyod, Saudi Arabia's leading accounting software provider, to propel the prosperity of SMEs in the Kingdom. Through this initiative, F

Launching Auto-invest!

Feb 05, 2023
Auto-Invest is designed to help investors quickly and efficiently allocate their funds to available, investment opportunities in a hassle-free manner. What is Auto Invest?Auto Inve

This website uses cookies to enhance your experience. By clicking "Accept," you agree to the use of essential analytics and marketing cookies. Blocking some cookies may impact your experience For details, see our .