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In-person with Ahmed Awadi, MoneyFellows CEO

In-person with Ahmed Awadi, MoneyFellows CEO

Egypt remains to be the most active venture capital (VC) market in the Middle East and North Africa (MENA), representing 25% of all transactions in the region in the first half of 2020, according to Magnitt’s H1 2020 MENA Venture Investment Report

Promising further growth, accountancy firm KPMG noted in a September statement that the industry saw some $20 billion worth of VC investment globally during the same period.

Topping Egypt’s Fintech scene is MoneyFellows, which managed to raise $4 million in a Series A round from Paris-headquartered global VC Partech and Egypt’s Sawari Ventures. The investment came less than a year after the company raised over $1 million in a Pre-Series A round from 500 Startups, Dubai Angel Investors, and Phoenician Fund. 

ArabFinance sat down with Ahmed Wadi, CEO of Money Fellows, to learn more about the startup’s edge, growth plans, as well as the local market potential.

How did the idea of MoneyFellows come to life?

Briefly, MoneyFellows, launched in 2016, digitizes the traditional concept of money circles, locally known as gam’eya, through an online platform. The idea came up during my stay in Germany when I was personally looking to participate in a traditional gam’eya but had to go through a lot of hassle finding and managing one.

We currently have over half a million users.

Can you tell our readers a bit about your unique selling points?

MoneyFellows overcame the obstacles anyone can face in traditional money circles, solving problems such as distance, time, and social limitations, while providing a wide range of money circles and slots for all kinds of users to choose from. 

Users can choose their desired amount and preferred months of payout all from the comfort of their homes with many pay-in and payout methods.

How does MoneyFellows contribute to financial inclusion?

The app is based on the idea of digitizing a traditional concept that millions of Egyptians resort to; many of those users are unbanked. We are here to help those who don't have any credit score or any other financial documentation, by providing them with a solution that is very handy, and at the same time creating for them a reliable scoring system that may help in future financial requirements.

Users are able to onboard themselves and pay using cash, but when it’s time to payout we can then issue them a prepaid card or issue them a mobile wallet to disburse their payouts on.

Who is your average user? Do you have more users from a specific age group or city?

Currently, the majority of our operations are in Cairo, Giza, and Alexandria so our customers are located in these cities.

We target users who are 21+ and willing to save up for their future. Our plan is to expand to more demographics and across all governorates.

What were your main challenges when you first launched vs your current challenges?

We had several challenges at the beginning, starting from reaching product-market fit to regulations and fundraising.

Today, our core challenge is to be able to completely change the behavior and culture that has been there for the past thousands of years, while building trust between people who are not necessarily within each other’s social graph. But we can see that Egyptians are willing to go more digitally.

Zooming in on cultural acceptance, did you face any issues gaining the trust of users? Is it more challenging to appeal to older generations?

Definitely, the most difficult part was convincing Egyptians to let go of the traditional game’ya and rather go for a digitized simpler version of it and trust an application to use their funds. We are building trust gradually, and we can see that people are becoming more welcoming to the idea and trusting the process.

Given that your company is founded on a concept closely tied with the Egyptian culture, do you see potential in expanding regionally?

Sure! We’re working on expanding to reach more demographics and areas cross country, and then MENA.

How the pandemic affected your business in terms of marketing efforts, operations, consumer interest?

Surely the pandemic had its downsides. But if anything, people headed for digitized solutions and online platforms for ease of use and lack of human contact. We utilized our strength points relevant to COVID-19 and quarantine such as staying at home and paying through several payment gateways with no need for physical contact. And with all the online shopping during that period, people would’ve definitely made use of cash!

Generally speaking, how do you compare the potential of Egypt’s fintech market with that of other MENA markets?

Egypt is on the right path. We have had some setbacks in the past but I believe we will catch up very soon especially with the new Fintech Law and the initiation of the regulatory sandbox.

In your opinion, how can the government further aid in the growth of fintech startups?

As I mentioned before, I believe the government is already helping through the establishment of a regulatory sandbox along with the new Fintech Law that would regulate all grey areas in the industry. We can see that the government started to adopt digitized solutions rather than traditional methods. Also, we can see facilitations provided for investors, supporting businesses in different sectors, not just fintech.

What is the one piece of advice you’d like to give to rising entrepreneurs?

Believe in your idea, no matter how impossible it may seem. Launch fast, optimize, and don’t wait to perfect the solution for it will never be without user’s feedback and behavior tracking. Finally and most importantly, have enough persistence and patience.

 

By Julian Nabil

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