Saudi Arabia-Based Online Cars Marketplace Syarah Raises US$2 Million In Series A Funding
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Riyadh-based startup Syarah, an online marketplace for buying and selling cars in Saudi Arabia, has closed a Series A round of US$2 million in investment led by Middle East VC firms BECO Capital, Raed Ventures, and Vision Ventures. This is the second investment round for Syarah, founded in 2015 by Saudi Arabian entrepreneurs Salah Sharef and Fayez Alanazi, with the company closing a seed round of $600,000 from BECO Capital and Raed Ventures in 2016.
Aiming to utilize the new funding to accelerate the platform’s expansion and growth, Syarah co-founder and CEO Salah Sharef says that the startup was launched with the intention of “empowering consumers with online tools to help them to search and find the car that they seek, empowering them to make informed decisions in the car buying process, and making the car buying process as smooth and transparent as possible.” In addition to merely listing cars, Syarah offers value-added services to help ease the process of buying cars- including providing Mojaz (car history reports), and also facilitating vehicle financing for interested buyers.
Commenting on why the entrepreneurs decided to launch Syarah in an offline and fragmented Saudi Arabian automotive market, Sharef says the Kingdom perhaps has the biggest car market in the Middle East in terms of volume of cars sold every year. “So, for an online car marketplace, it made sense to go after the biggest market in the region, especially considering that there was no dominant online cars vertical in the country yet,” says the entrepreneur. “I already had more than seven years of experience doing [working on] an online classifieds marketplace in MENA, mainly through my first startup, OpenSooq,” he says, talking about his personal journey with Syarah. “So, it made sense to build upon previous experience in online marketplaces, and move on towards doing a cars vertical marketplace, where there is still a big need in the region, given that this area still has not been tackled yet.”
And looking at Syarah’s traction currently, one might say that the startup’s strategy seems to be working well, and is gaining acceptance among the country’s consumers. The platform claims more than 1.7 million visits per month currently, and says it generates more than 200,000 leads per month for car sellers. “Also, more than 10,000 applications for car financing are submitted through our platform every month, and our revenues have doubled since last year,” says CEO Sharef. This, according to Sharef, also played a role in deciding the valuation of the startup in its current round of funding. “Valuation for the current round was relative to the last valuation from the previous round, and the percentage of growth that we were able to achieve in our KPIs since the previous round,” he explains. “From seed to the current round we were able to triple our numbers across most of our KPIs. Therefore, our valuation would increase in proportion,” he adds.