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Saudi Arabia-based fintech startup Hala has acquired UAE-based online payments platform Paymennt.com (Paymennt).
Founded in 2018, Hala is a fintech platform that provides financial services and digital tools to help small and medium-sized enterprises (SMEs) grow and expand. Regulated by the Central Bank of Saudi Arabia, Hala’s point-of-sale solution is a device that can be activated in as little as 15 minutes and then delivered to any given location. Merchants using the Hala platform can also process bank card payments without a bank account as long as they have a legally registered trade license.
On the other hand, Paymentnt was launched in 2017 and is an online payment platform that allows small and medium-sized enterprise merchants to process online payments through payment links, e-commerce payments, QR code payments, etc. In addition, it offers API integration, allowing SMBs to launch web-based stores through an application that can be completed in five minutes. Since its founding, Paymentn (formerly PointCheckout) has built its reputation by helping over 3,000 micro and small businesses expand their presence in the e-commerce space.
“Our merchants have been able to process online transactions without the need for an online presence through payment links and social media selling, and the same account enables them to list their goods or services online on their website with the click of a button,” Gobar said explained in an interview middle east entrepreneur. “These tools allow merchants to slowly move online at their own pace while maintaining current processes without completely changing their business from day one or paying high fees upfront. With Hala’s experience, it has acquired over 50,000 merchants in two years. With a wealth of experience, we see exponential growth across the region and bringing these types of tools to more merchants and combining one account with online and offline payments.”
Tarek Ghobar, co-founder of Payment.com.Source: payment
Payment co-founder Tarek Ghobar has observed and understood the needs of UAE SMEs over the years and believes his business has the ability to contribute to Hala’s overall vision. “I believe it’s our team and our growth story and the fact that the two companies’ products complement each other. [that made the Hala team go ahead with this acquisition]Ghobar said. “An important next frontier in Hala’s product roadmap is online payment processing, and as such, our expansion plans include regional rollout and the launch of additional value-added services for our SME merchants. Together, we will provide merchants with a comprehensive Payment processing solutions, starting with business launch and face-to-face payments, all the way through to their foray into online sales and payment processing.”
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It’s clear that this acquisition actively meets both companies’ business missions. In fact, this will mark Hala’s second successful acquisition – the first being that of Saudi startup Fresh in 2021, which resulted in the addition of a new feature to its platform called Hala Cashier, which allows Integrate non-financial value-added services for small and medium-sized enterprise customers. Still, Gobal acknowledged that acquisitions aren’t always the easiest exit strategy for startup owners. “Often, however, this is a logical choice,” he added. “Conversations with Hala began while we were raising money for the company and quickly developed into an acquisition. We couldn’t ignore Hala’s KPI growth and our company’s potential to become part of their organization. But most importantly, We found mutual understanding in Hala’s leadership when it comes to business ethics, value creation and entrepreneurship. Hala’s founders addressed our concerns and worked to nimbly reach agreement in such a complex conversation.”
Looking to the future, Ghobar remains confident in what Paymennt and Hala can achieve together. “Our shared vision is to truly be a one-stop shop for all payment processing needs and all merchant interactions with small business customers, and then export that process to other parts of the world where SMEs face similar challenges with their payment infrastructure. facilities,” he concluded.
Payment co-founder Tarek Ghobar discusses what entrepreneurs should consider before accepting an acquisition offer
1. The well-being of the team comes first “Ensuring they have stability and opportunities for growth in their careers.”
2. Investor returns are equally important “Involve investors in the conversation early so they can help with leverage and/or experience as well.”
3. Make sure the acquiring company has the right culture “Often, corporate acquisitions of startups create a large mismatch between team members and founders, which is not always apparent in the initial negotiations and can cause the team to leave and affect the outcome.”
4. Conduct necessary due diligence “Ask about the company’s financial health and, if possible, their investors. If the acquiring company has made any other acquisitions in the past, be sure to reach out to other entrepreneurs and get their feedback on progress and any unfulfilled promises.”
5. Founders’ compensation (stock, salary, cash, etc.) needs to reflect their hard work “This is even more important when the choice is between financial outcomes for founders and financial outcomes for investors.”
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