Online retailer Souq gets $275 million boost
Souq.com, an online retailer based in the United Arab Emirates, has raised $275 million from international investors. This is a huge boost not only for the site but for digital commerce in the Middle East as a whole.
The website, founded in 2005, started with an eBay-like auction model but soon evolved into an Amazon-style set-price retailer. It's a rare success story in a region where similar businesses often face logistical problems, political challenges and stifling regulations that vary from country to country.
This latest round of investment included money from New York-based Tiger Global Management, as well as from Standard Chartered Private Equity and the International Finance Corporation.
We don't know what this funding means for the site's overall valuation and it has not released any details on its annual sales but the $275 million sum is the largest ever disclosed by a tech-start-up in the Middle East, according to Wanda, a research firm based in Dubai.
The Chief Executive of Souq has said the money will go to improving the technology around its payment processing as well as to increase the scale of its operations by improving logistics.
The money will also help to improve Souq's mobile app as the retailer gets a huge chunk of sales from mobile phones. The number is as great as 70% in Saudi Arabia – Souq's second biggest market – for purchases made through the app.
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