Saudi Arabian Buy-Now-Pay-Later Firm Tabby Raises $200 million in Series D Round

Saudi Arabia-based Tabby has raised $200 million in a Series D funding round, valuing the buy-now-pay-later firm at over $1.5 billion. The round was led by Wellington Management, with participation from Bluepool Capital and existing investors Saudi venture capital firm STV, Mubadala Investment Capital, PayPal Ventures, and Arbor Ventures. With this investment, Tabby has become one of the Gulf region”s first fintech unicorns, having more than doubled its valuation from $660 million in January 2023.

“We are building and broadening out our consumer and merchant offering,” Tabby CEO Hosam Arab said in an interview with Bloomberg News. “We are investing heavily in widening the product options available for our consumers, largely around financial services.”

Tabby allows customers to purchase goods in installments. The company currently operates in Saudi Arabia, the United Arab Emirates, and Kuwait, with over 10 million registered users. It competes with other buy-now-pay-later firms such as Tamara.

Over 30,000 brands sell their products through Tabby. The Dubai-founded company plans to list its shares on the Saudi stock exchange, as the majority of its business is in Saudi Arabia, the largest e-commerce market in the region. Tabby has seen strong growth, with new customers joining and existing customers sticking with the platform, Arab said.

“We”re not able to share any specific timelines yet,” Arab said of the IPO. “But it”s not something in the very distant future.” The company is also continuing to look for merger and acquisition opportunities that would open up new product areas in the markets it already operates in, he said.

However, macro-economic headwinds such as inflation, high-interest rates, and creeping recession fears are raising concerns for the company. Despite these challenges, Tabby”s performance has remained resilient. “Consumers see the value in the product, they don”t want to lose access to it, and therefore their repayment behavior is actually quite strong,” Arab said.

“We still haven”t seen any major change in consumer spend over the last year,” he said. “The retail consumer, in our view, remains healthy.”