Saudi Aramco's Wa'ed And Raed Ventures Lead US$5.5 Million Seed Round Raised By Riyadh-Based Fintech Startup Lamaa Lamaa, a Riyadh-based fintech startup, has raised a seed investment in a round led by Raed Ventures and Saudi Aramco's entrepreneurship arm Wa'ed.

Lamaa, a Riyadh-based fintech startup which provides invoice financing solutions for SMEs, has announced raising one of the largest seed rounds in Saudi Arabia, with the US$5.5 million in financing led by Raed Ventures and Saudi Aramco's entrepreneurship arm, Wa'ed.

In line with Saudi Arabia's Vision 2030 to digitize SMEs and raise their contribution to 35% of GDP by 2030, Lamaa seeks to address funding gaps for SMEs whose size presents a challenge in obtaining credit risk ratings, having a direct impact on their cash flow.

"Since our initial launch in March 2021, Lamaa has gathered significant traction with over 100 corporate clients in the pipeline and a projection of over $1 billion dollars worth of invoices to be soon launched in its marketplace," Sumeet Khutale, founder and CEO of Lamaa, who has recently relocated from London to Riyadh, said. "In addition to supply chain finance, we will soon start offering B2B 'buy now pay later,' which would be the first of its kind offering in the region. We also plan to expand in Egypt, UAE and Qatar in the next few months."

Sumeet Khutale, founder and CEO of Lamaa

Khutale believes Lamaa's market potential in the MENA region to be huge, due to the region's GDP being $3 trillion, 30% of which at least is attributed to SMEs. In parallel, 22% of Saudi's current GDP ($700 billion) comes from SMEs, Khutale adds. The seed investment will be used to scale Lamaa into the major regional provider of SME liquidity, enabling the growth of SMEs in the MENA region, with the Lamaa's immediate plans to focus on client acquisition and the development of additional features on the platform.

Fahad Alidi, Managing Director at Wa'ed, the entrepreneurship arm of Saudi Aramco, the largest and most active institutional venture capital investor for Saudi-based startups, said, "For a newly established startup that has already acquired impressive growth and secured key partnerships across the Saudi market, Lamaa presents the type of entrepreneurial business that not only empowers its own team and startup sector, but can also promote a stronger foundation for other emerging local SMEs who use the platform for financing solutions."

"TREP TALK: Lamaa founder and CEO Sumeet Khutale's tips for entrepreneurs seeking investment in Saudi Arabia

1, Make an impact "Be bold and focus on creating a wider, all inclusive social impact, which aligns with the Saudi Vision 2030 by solving legacy obstacles that technology can help overcome and help create new business models."

2. Hire local talent "Leverage the excellent local talent available in Saudi Arabia, as they understand the ecosystem and can help jumpstart the business."

3. Ask for help "Regulators and fintech support groups, including venture capital firms, are extremely helpful, and they will guide you through out the entire process."

Related: How Fintech Can Help Ensure The Survival Of SMEs In The Middle East