Generation Start-up: How constraints in the gig economy led to SimpliFi payments

Dubai cards-as-a-service platform aims to address the huge gap in the financial services industry

Ali Sattar, founder and chief executive of SimpliFi, says his start-up is well-funded for the next year or so, but needs to plan for more with demand rising. Khushnum Bhandari / The National

For Ali Sattar, experience not only proved to be the best teacher — it was also a way to ease the pain that burdened him so much that it led the entrepreneur to start a platform to help workers of the gig economy in the most uncomplicated way.

The emergence of SimpliFi, a Dubai-based cards-as-a-service (CaaS) platform, put the spotlight on what Mr Sattar describes as a "huge gap" in the payments industry.

He is on a mission to address the long time it takes for the hardworking men and women in freelance, temporary and flexible jobs to be paid, something he believes they truly deserve for all the gigs they engage in.

Quite frankly there’s very little competition for what we do at the moment, but right now we have so much demand; people are waiting for the product in several markets

Ali Sattar,
founder and chief executive of SimpliFi

The former head of Careem Pay first noticed this "problem" while he was working with the Uber-owned ride-hailing service. He envisioned a system that would allow temporary workers to receive their money in real time in a low-cost, ubiquitous and scalable manner.

"It wasn’t a light bulb idea while in a cafe or sketching something; it was seeded through my own personal experience and it matured over time to the point when I said this is it," says Mr Sattar, founder and chief executive of SimpliFi.

"All of the different payment methods we had — bank accounts, wallets et cetera — did not really cut it. We knew issuing prepaid cards was the solution. It was great on a PowerPoint presentation, but we just couldn’t execute it because this region is so fragmented."

In a bit of irony, the "moment of truth" came while he was having coffee with a chief executive of another large platform in the UAE who was looking to lure a payments player from the US. That company wasn't ready to come because the Middle East lacked the CaaS infrastructure they sought, so Mr Sattar decided to give it a go.

CaaS takes traditional financial cards — which are bound to their issuers' standard rules — a step further. It is a service that provides a comprehensive and end-to-end solution, which can also be tailored to individual clients' needs or wants.

"The person told me, 'look you’re from the payments world and this is what you want to do'. The idea was moving in the right direction but that just nailed it. I walked away from that conversation saying, people are literally waiting for this product."

It was at this time — about three years ago — that he set the SimpliFi gears in motion.

The gig economy is often described as a free market where companies hire freelancers to provide services, most notably ride-hailing and food delivery, to cut costs.

The arrangement benefits both parties. For employers, it reduces human resource costs, while workers are able to choose the gigs they want and even switch between multiple professions as long as it is convenient for them.

The global gig economy was estimated to be worth $347 billion in 2021, and is projected to grow to $455 billion in 2023, according to Brodmin. Getty Images

The global gig economy is projected to grow to $455 billion in 2023 from an estimated $347bn in 2021, payments services provider Brodmin estimates.

In the UAE, the most notable companies involved in the gig economy are Careem, which was acquired by industry pioneer Uber Technologies for $3.1bn in 2019, and delivery services such as Zomato, Talabat and Deliveroo.

More people are using the services of these companies thanks to the convenience, speed and variety they bring to the table, along with the consolidation of services in one single app. Careem, for example, has significantly expanded to offer anything from groceries to food and bill payments to PCR tests.

Globally, the top reason why people choose gig roles is because of their flexible scheduling, says business-to-business solutions provider FinancesOnline. The top three industries for freelancing are arts and design, entertainment and construction, while the countries with the highest gig participation rate include Brazil, the US and the UK, it says.

The Covid-19 pandemic accelerated the shift to digital services as consumers switched to cashless payments and online shopping. Globally, digital payments are projected to grow to $8.26 trillion by 2024, surging almost 88 per cent from $4.4tn in 2020, according to Statista.

Payments solutions are already simple, but Mr Sattar wanted to take it a step further without going through unnecessary hassles.

"The opportunity is massive and there are gig platforms in all shapes and forms," he says.

"These gig workers are very different from salaried people; they may have five platforms they work with and take whatever job comes first or whatever they prefer."

Mr Sattar says SimpliFi is "unique" in the sense that companies can just "plug" in and issue cards to their workers.

There is very little competition in the space right now, he says, which would make one think that the company has all the advantages.

However, the company believes the infrastructure is far from where it needs to be, and that's where they want to further distinguish themselves from the present and future competition, with sort of a first-mover advantage.

"We have so much demand. People are waiting for the product in several markets," Mr Sattar says.

"This concept is very new for this region, and that’s what we’re building now. It’s about time companies didn’t have to go to banks and regulators in each market and deal with this complexity. They need just one platform."

SimpliFi's business model is straightforward. Companies sign up, which enables them to issue payment cards instantly to streamline business operations, drive new revenue streams and increase loyalty.

Companies with regional presences stand to benefit the most from SimpliFi, Mr Sattar says. He declined to go into specifics or say who the company’s clients are, but says their business is significantly gaining traction.

Globally, the top reason why people choose gig jobs is because of its flexible scheduling, according to FinancesOnline. AFP

"We signed up a good number of clients, some of them are very large brands across the region. We have at least 35 partners," he says, noting that these include banks, tech companies that are payment processors or gateways, digital identity and verification companies, couriers and card manufacturers, among others.

SimpliFi has raised more than $5m in funding, successfully concluding two rounds in 2021 alone. The company is well-funded for the next year or so, Mr Sattar says, adding that they need to plan for more with demand rising.

"Our next funding aim depends on how quickly we build, but by the looks of it we’ll be going to the market again pretty soon," he says. "If we get good clients with large volumes right away we know we have something we can build on and then we can build on with more capital."

Q&A with Ali Sattar, SimpliFi's founder and chief executive

Are you profitable?

We’re a start-up, you know how it is. We’re still building and very early in this innings. It’s a long game, it’s a marathon. We’re building, not only a product, but also a market.

But the good thing is that this is B2B. Unlike B2C propositions that are burning cash on every corner, we are profitable on every contract we acquire. That’s good news, as it won’t take us years to be profitable.

Are you planning to launch a new start-up?

The next one, after SimpliFi, would probably be a food start-up — something more interesting than payments, and something you can relate to on a day-to-day basis.

This is probably because of my love for travel and seeing the connection between food and the history of different countries. There’s fusion.

SimpliFi founder Ali Sattar says regional demand is enormous for the product offered by the company. Khushnum Bhandari / The National

When would cashless be king?

Society is moving towards cashless transactions, and we are trying to change that by democratising card issuance. If we can do that at scale and we have the infrastructure, we can start digitising cash issuances, salary, per diems, petty cash and so on.

If we start doing that, we’re moving towards a real cashless economy. Cashless is not about individuals like you and me paying through cards.

Would you have preferred to have a co-founder instead of going it alone?

In hindsight, I would have loved to have a co-founder. It’s much more fun, and emotionally, you have someone there to lean back during ups and downs, take the risk with you, bounce off ideas and advise each other. It can get a bit lonely or isolated honestly. Ultimately, all decisions come onto you.

But getting the right founder is not easy, who shares the same idea, is as passionate and always willing to take the risk. It’s like a marriage — both should have the values.

How much of your time do you dedicate to the start-up?

I’m a free agent. I’m married to SimpliFi. If I was married, I don’t think I would spend as much time. I've put marriage on hold, but a bit of pressure is already building. I work 15 hours a day.

I'm 47 and one of the few people to decide to set up a start-up at this age — typically you’ve got 25-year-olds doing it — but I was ready to solve this problem.