SoftBank ventures into Saudi Arabia in a deal with wealth fund | Business and Economy News

SoftBank has partnered with Saudi Arabia’s sovereign wealth fund and plans to expand in the Middle East and Africa.

SoftBank Group Corp. made its first investment in a Saudi Arabia-based company, partnering with a unit of the kingdom’s sovereign wealth fund to lead $ 125 million in funding for the Unifonic customer communications platform.

The proceeds will be used to fund growth in the Middle East and expansion in Asia and Africa, Unifonic co-founder and CEO Ahmed Hamdan said in an interview. The company will also consider acquisitions in those regions to help it grow faster, he said.

The Unifonic deal is funded by SoftBank’s Vision 2 Fund and follows the $ 415 million fundraising in July from Dubai-based cloud kitchen startup Kitopi, which was SoftBank’s first in a business based in the United Arab Emirates and raised the valuation of that company beyond $ 1 billion. Last month, he also co-led a fundraising round for Turkish e-commerce company Trendyol.

Along with SoftBank’s foray into the Middle East comes a growing number of so-called unicorn companies worth at least $ 1 billion. More and more outside investors are looking to bet on a shift to online services that has lagged behind other regions.

Swvl, a Dubai-based transit solutions provider, said in July that it plans to list on Nasdaq in association with specialist acquisition firm Queen’s Gambit Growth Capital, with an implied net worth of around $ 1.5 billion.

Unifonic provides cloud-based software for sending automated messages. As the pandemic spread, businesses turned to these services to send one-time passwords or shipping updates to customers. The company processed 10 billion transactions last year, charging a small fee for every message it sends to customers.

Hamdan declined to comment on the latest valuation, but said the company expects sales for the year to exceed $ 100 million and will begin planning a listing on a global stock exchange within the next three years.

“Being able to attract one of the best international funds to invest in Saudi Arabia is an important step that will encourage more foreign direct investment to enter the digital and technological space,” Hamdan said. “We will optimize to be listed on a global market that can provide the best valuation. “

STV, Sanabil

Founded by Ahmed and his brother Hassan Hamdan in 2006, Unifonic was largely self-financing during the first decade. He raised $ 21 million in 2018 led by STV, a $ 500 million venture capital fund established by Saudi Telecom Co.

Sanabil, a unit of the Saudi Arabia Public Investment Fund, was also an investor in the company. The PIF, as the heritage fund is known, invested $ 45 billion in the inaugural Vision Fund, which supported many of the biggest tech startups, including Uber Technologies Inc., Opendoor Technologies Inc. and DoorDash Inc.

“Over the next five years, we see the business grow 10-fold,” Hamdan said. “We could therefore process 100 billion transactions, impact 400 million people and potentially work with 50,000 companies. “

The valuation of Twilio Inc., which operates a similar business and is listed on the New York Stock Exchange, has more than tripled to nearly $ 60 billion since the pandemic forced more transactions to move online.

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