The funding comes from previous investors Tiger Global and Naspers, as well as some strategic investors, includingStandard Chartered Private Equity, IFC (a member of the World Bank Group), Baillie Gifford, and “many reputable regional and tech-focused financial institutions,” Souq said in a statement, techcrunch.com reports.
This latest funding brings the total raised by Souq to USD 425 million. Tiger Global and Naspers known investors in the emerging world, with a focus on ecommerce in their wider portfolios. Both Naspers and Tiger invest in Flipkart in India, for example.
Souq says that it will use to scale up its business, which operates a marketplace that works with third party retailers, and sells goods directly to consumers. It has not (yet) moved into areas like cloud services, streaming media or hardware development.
“The funding will be used to drive further growth by investing in technology, scaling our marketplace operations, launching new product categories and recruiting the best talent,” said Ronaldo Mouchawar, CEO of Souq.com, in a statement. Souq predicts the ecommerce market in the Middle East to reach USD 20 billion this year.
Souq was originally founded back in 2005 as part of Maktoob, a portal that got acquired by Yahoo, leaving Souq behind. Maktoob had been the leading Internet portal in the region, but as with so much else in the Yahoo portfolio, it quickly got left behind with the growth of Google and other trends. It eventually shut down in 2014 as part of Yahoo’s long road of winding down unprofitable operations.
Souq says it offers some 1 million products across 31 categories such as consumer electronics, fashion, health and beauty, household goods, and baby. It also says it attracts over 45 million visits per month, with localised portals in UAE, Egypt and Saudi Arabia.
Other region-specific marketplaces such as Flipkart and Snapdeal in India have collectively raised billions of dollars to build out their businesses, but it looks like both are focused on expansion in their home market of India, one of the world’s largest countries by population.
In contrast, Souq works across a number of smaller markets, and this seems to point to a lot of potential for the company to expand elsewhere. This would also help it against the likes of Namshi, the company backed by Rocket Internet which in 2014 merged with several other marketplace businesses in Rocket’s portfolio to form the Global Fashion Group.
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