Astra Tech, a UAE-based technology investment and development group, is looking to raise $500 million in funding as it prepares to develop and launch a new digital platform that seeks to simplify the consumer shopping experience.
The "ultra platform", said to be a first in the Arab world, will allow sellers and consumers around the world to directly transact with each other for services and products in a single venue, eliminating the complexity of using several apps, Astra Tech said on Tuesday.
The group has been making strategic acquisitions, which will be disclosed soon, and recruiting global talent to expand operations, said Abdallah Abu Sheikh, founder and chief executive of Astra Tech.
"Our goal is not to reinvent the wheel, but to repurpose familiar platforms to create what we call an ‘ultra platform’," he said.
"The company’s vision is to simplify the way people communicate, shop, pay and transact. [The platform] will allow businesses and vendors worldwide to effortlessly connect with customers across a variety of essential everyday services and products, enriching users’ lives with speed and simplicity."
E-commerce sales in the Mena region are expected to grow to about $50 billion in 2022, according to Dubai-based e-commerce company CNNB Solutions.
This will be driven by rising online shopping, access to digital financing, improvements in logistics and delivery options and brands adopting direct-to-consumer strategies, it said.
The rise in the adoption of digital transactions and cross-border payments has particularly supported small and medium businesses in the UAE, which have been earning more than they were before the Covid-19 pandemic began, financial services major Mastercard said in a report last month.
Meanwhile, investments in the financial technology sector will continue to remain on the radar of venture capital (VC) and investment funds, despite slowing economic growth and mounting worries about a global recession, with the GCC continuing to be particularly attractive, experts said at the DIFC FinTech Week in June.
VC companies invested about $500bn globally in start-ups, with $7.5bn injected in the Africa, the Middle East and Pakistan region, according to start-up data platform Magnitt.
Astra said it aimed to specifically address "platform fatigue" arising from an oversaturation of platforms that seek to integrate several semi-related services into their app’s core offering, resulting in a poor user experience.
This results in placing an "unnecessary burden on suppliers and partners through unfavourable revenue structures across the many services provided", it said.
Mr Abu Sheikh said this complexity resulted in an "overabundance of complex and sluggish digital platforms that aren’t fit for purpose".
"We’ve seen how, in an effort to overcome profitability challenges and poor unit economics, platforms have jumped from one business line to the next in an attempt to force users to complete more transactions with them," he said.
"We want users to accomplish a lot more on a single platform without the need for additional apps or a subpar user experience."
The platform will also support the commercial goals of suppliers and partners, who will benefit from the reduced complexity of having to deal with customers on several fronts.
“We have been working to shape Astra Tech into an entire interconnected ecosystem that is equipped to deliver on our massive ambitions and continue being pioneers in our space," Mr Abu Sheikh said.