- Kema, backed by $2 million in pre-seed funding, is set to unveil a specialized Software-as-a-Service (SaaS) platform designed to cater to SMEs, tackling issues such as payment delays and fragmented systems.
- Kema digitizes and streamlines the invoice-to-cash process, accelerating business cash flow while saving time and resources.
- Kema offers hassle-free integration with popular accounting software and provides real-time analytics on cash flow, enabling informed decision-making for SMEs.
Kema, a fintech platform based in the UAE, co-founded by Michael Ghandour, former co-founder of Mumzworld.com, has secured $2 million in pre-seed funding. The funding round was led by Speedinvest and included participation from the Dubai Foundation District Fund (DFDF). Kema is revolutionizing B2B transactions by digitizing and streamlining the invoice-to-cash process, also known as accounts receivable.
This transformation accelerates and automates cash flow for businesses, saving them valuable time and resources. With this investment, Kema aims to launch its Software-as-a-Service (SaaS) platform tailored to support SMEs, expand its solution across the UAE, and recruit top talent to fuel its growth trajectory.
According to a 2021 report by the UAE Central Bank, the staggering business payments volume in the UAE surpassed $1.5 trillion, significantly outpacing retail payments by nearly 50 per cent. However, despite this immense economic activity, the financial landscape for B2B SMEs presents a starkly different picture. Michael Ghandour, the CEO of Kema, underscores the challenges these SMEs face, citing persistent payment delays, manual invoice processes, disjointed systems, and limited access to financing as key obstacles.
Ghandour emphasizes that despite their crucial role in the economy, many B2B SMEs struggle to maintain a healthy and predictable cash flow cycle. This struggle not only hampers their growth prospects but also leads to increased operational costs and inefficiencies. The repercussions extend beyond financial constraints, affecting the productivity of employees who must grapple with cumbersome manual tasks.
The impact of trapped working capital within B2B SMEs across the MENA region is staggering, as highlighted in a 2023 PWC report which identified $44 billion trapped among just 424 regional companies. Co-founder and CTO Akash Rao extrapolates this data, estimating that over 500,000 B2B SMEs in MENA collectively harbour approximately $400 billion in trapped working capital. This underscores the urgent need for solutions to address this financial bottleneck.
Historically, the B2B SME segment has been underserved, lacking adequate capital and solutions. Kema, however, aims to disrupt this paradigm. With a clear mission articulated by founder Michael Ghandour, Kema seeks to expedite cash flow for B2B SMEs by leveraging cutting-edge technologies, all without burdening clients with integration complexities.
Since its private beta launch in Q2 of 2023, Kema has already facilitated over AED 16.5 million ($4.5 million) in invoices. Co-founder Akash Rao emphasizes the platform’s evolution, noting a remarkable 50% reduction in the receivables process. Moreover, Kema remains committed to enhancing its offerings, continuously introducing new features tailored to diverse business needs and sizes.
Kema’s user-friendly approach to SME finance is underscored by its hassle-free “no-code” plug-ins, seamlessly integrating with renowned accounting software like Xero and Quickbooks. In just minutes, businesses can harness Kema’s capabilities, from generating and processing invoices to automating payment reminders and receiving payments through various digital channels. Moreover, real-time analytics on cash flow provide invaluable insights for informed decision-making.
The COVID-19 pandemic has acted as a catalyst for digital transformation, with 90% of SMEs in MENA recognizing digitization as a key driver of growth. In response, governments have launched initiatives like the Dubai International Growth Initiative and the Financial Sector Development Program in KSA to support SMEs thriving amidst these changes.
Stefan Klestil, a partner at Speedinvest, acknowledges the profound impact of SME digitization on the market. Expressing excitement about Kema’s potential, he highlights the platform’s ability to enhance financial workflows for B2B SMEs, thus empowering them to unlock new avenues for growth and opportunity in the region. With its expertise in the fintech space, Speedinvest is poised to support Kema’s mission and contribute to its success.
Sharif El-Badawi, CEO of the Dubai Future District Fund, emphasized the alignment of Kema’s vision with Dubai’s Economic Agenda (D33), highlighting technology’s pivotal role in digitizing core financial functions. Kema’s understanding of SME financing challenges positions it as a frontrunner in delivering a comprehensive solution tailored to the UAE market.
El-Badawi’s endorsement underscores Kema’s potential applicability across various emerging markets, reflecting its adaptability and relevance beyond regional boundaries. With a keen focus on addressing SME pain points and leveraging innovative technology, Kema emerges as a promising player in reshaping the future of finance in the UAE and globally.
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