Generation Start-up: Why HyperPay believes cash will soon be 'consigned to history books'

Saudi Arabia-based company that counts Mastercard among its investors is helping transition towards 'complete digital society'

Muhannad Ebwini, back row centre, with his team at HyperPay. The founder and chief executive says the company is 'very excited' about the prospects of its initial public offering: Photo: HyperPay

Getting into financial technology is serious business. Not only does it provide a whole new perspective of payments innovation to consumers, but it also paves the way for a future that is completely cashless.

Muhannad Ebwini is passionate about that future. He believes the transition to a world where cash is a thing of past and technology makes payments quick and easy is inevitable. He wants to do his bit to make that future a reality — sooner rather than later.

It also helps that the name of his company, HyperPay, aligns with this goal.

“It always made sense for me to pursue a career in the FinTech industry and ultimately launch my own company,” Mr Ebwini, founder and chief executive of Riyadh-based HyperPay, says.

“It’s an industry with so much potential and I’m very excited about its future.”

The adoption rate of FinTech products among end users and merchants will reach “even bigger heights over the coming years, helping transform payments as we know it”, he says.

“I genuinely believe that cash will soon be consigned to the history books, with the rise of a completely digital society.”

HyperPay has grown to become an online payment gateway that processes millions of transactions annually for thousands of merchants across several industries. Aside from payments processing, it also offers services such as risk and fraud management, and monitoring financial and invoicing systems.

Start-up funding activity has grown sharply in the region and ventures continue to attract investments to grow their businesses

The venture capital ecosystem in the Middle East, Africa, Pakistan and Turkey (Meapt) attracted $5.1 billion in funding during the first half of 2022, with the first quarter setting a record for financing, data provider Magnitt's half-yearly report said.

FinTech remained the leading industry in the broader region for the third consecutive half-year period, raising $1.6bn across 210 deals in the first six months of the year. It was the highest funded and most transacted industry across emerging venture markets, the report added.

Start-ups in Saudi Arabia — HyperPay's home market where the FinTech industry has grown at a steady pace — attracted a record $548m in venture capital financing through 139 transactions in 2021, with FinTechs accounting for 19 per cent of total deals, Magnitt data showed.

The global FinTech market, meanwhile, was valued at about $136bn in 2021 and is projected to hit almost $266.9bn by 2027 at a compound annual growth rate of 12 per cent, US-based Expert Market Research said.

The FinTech industry was already thriving and expanding at a brisk pace before the Covid-19 pandemic. However, the jolt to the global economy and ensuing lockdowns across most parts of the world underpinned the industry's value.

Contactless and cashless payments, thanks to their ease, safety and increasing focus on security, became a more recognised and more accepted mode of transactions by safety-conscious consumers.

That momentum has continued, with existing FinTech companies stepping up the game and new entrants bringing in more choices for both consumers and institutional clients. It is seemingly a glimpse of that cashless future Mr Ebwini envisions.

“I would say the coronavirus pandemic has had a big impact on HyperPay and the wider FinTech industry. We were forced to take extreme measures when adoption rates for using online payments increased dramatically during lockdowns,” he says.

“We learnt to be ready to provide solutions for any crisis. Having a digital channel in the market is not fancy anymore. It’s a must.”

There were more than 26,000 FinTech start-ups globally, with 9,300 — or about a third — based in the broader Europe, the Middle East and Africa region, research company Statista said in its November 2021 report.

HyperPay, which was founded in 2014, has steadily climbed the ranks despite intense competition. In August last year, FinTech Middle East ranked the company as among the most well-funded start-ups in the region.

More recently, Forbes Middle East listed HyperPay among its top 25 FinTech companies for 2022, noting that the company processed 112 million transactions worth a combined $4.7bn in 2021.

“The FinTech industry is highly competitive, both internationally and locally. So, standing out from the crowd is a big challenge,” Mr Ebwini says.

The Middle East has a thriving FinTech industry, with the GCC as a whole and Egypt offering the “greatest market potential”, he adds.

The high and constantly growing mobile and internet penetration, and the scale of the region’s economies, which Mr Ebwini describes as “impressive and above the global standard”, have accelerated the industry's growth.

The entrepreneurial spirit of founders who started their ventures small but developed them to become the driving force behind some of the Middle East's most prominent institutions has also been a bedrock of FinTech growth in the region, he says.

Samih Toukan, who founded Maktoob.com, which was acquired by Yahoo in 2008; Mohammed Al Ballaa, chairman of Mubasher Financial Group; and Ronaldo Mouchawar, who co-founded Souq.com, which was later acquired by Amazon, are only a few examples, Mr Ebwini says.

“I feel honoured to be working with them … their success continues to inspire me, and I’ve learnt so much from them,” he says.

Mr Ebwini says entrepreneurship is seeded deep in his DNA. His father, also a businessman, inspired him to become an entrepreneur and set up his own company.

He founded HyperPay alone but says without the support of his family and friends: “I wouldn’t be where I am today.”

The success of HyperPay — which has more than 100 employees and has offices in Dubai, Bahrain, Egypt and Jordan — has not gone unnoticed by investors. In June, the company raised $36.8m through a funding round that included global payments major Mastercard.

The investment will be used in particular to grow its footprint in the Egypt, Oman and Qatar markets, and further boost its research and development capabilities.

The company also plans to expand its team and invest more in research and development, as it aims to start an array of cashless services that private business and governments can integrate into seamlessly.

“We hope to deliver a complete suite of financial products that meet evolving customer needs,” Mr Ebwini said.

The latest funding round brought total investments into the start-up to $55 million, and supports the company’s plans for an initial public offering (IPO).

Mr Ebwini said HyperPay is “gearing up” to go public, and a pre-IPO round is “likely to happen” over the next three years.

The company is planning to list on Nomu, the secondary market of Saudi Arabia's Tadawul stock exchange.

“This will be a key step in our company’s growth and the whole team is excited about the prospect,” Mr Ebwini said.

The FinTech industry's rapid evolution has been driven by evolving preferences of consumers. However, with the rapid growth came the attention of regulators, who are closely monitoring the industry to keep it in check amid the rising potential for fraud and other cyber crimes.

“While the FinTech industry offers so many great opportunities, it’s not without challenges. By far one of the biggest is meeting financial regulations and customer expectations, which differ greatly in every country,” Mr Ebwini says.

As an entrepreneur, Mr Ebwini's has learnt to embrace failure and take lessons from them it. And that is the advice he has for budding entrepreneurs.

“Most importantly, enjoy your entrepreneurship journey. I definitely love being an entrepreneur.”

Muhannad Ebwini founded HyperPay to solve the various challenges posed by localised payments, whether it’s adhering to each country’s regulations or meeting the needs of different cultures. Photo: HyperPay

Q&A with Muhannad Ebwini, founder and chief executive of HyperPay

What is the single biggest challenge you have faced in your career?

One of the biggest challenges I’ve faced throughout my business career has been finding good people. With HyperPay continuing to grow, building a team that stretches multiple countries is also challenging. But luckily, we have a great team at HyperPay.

How do you guarantee the security of your network?

For anyone sending and receiving money through a FinTech solution, security and privacy are understandably at the top of their minds. We’ve developed a safe and secure platform by following global industry standards and using the best technologies.

Do you see yourself establishing another start-up?

At the moment, my main priority is to grow HyperPay by expanding to new territories and launching new products. My team and I have lots of great things planned at HyperPay. As such, I’m not considering launching a new start-up or venturing into a new industry.

What is your advice to would-be entrepreneurs?

Age should never be a barrier to becoming an entrepreneur. If you have an idea that would make a great business, don’t be scared to pursue it. When a solid idea comes to your mind, start turning it into a business as early as you can.

What do you do during your free time, if you have any?

Running a fast-growing business definitely takes up a lot of time and energy. While I don’t have a lot of free time, I do like to find the opportunity to relax and spend time with friends. It’s important to avoid burnout, especially in key stages of growth.