Lean Technologies receives first investment from General Catalyst, a Silicon Valley venture capital firm, in Saudi Arabia.

• The first investments made by General Catalyst, Stanley Druckenmiller, and Bain Capital in Saudi Arabia are in Lean Technologies.
• The fintech industry in the MENA region is projected to be worth $4.5 billion by 2025, according to a recent McKinsey report.
• Since 2018, Saudi Arabia's fintech startups have attracted more than $1.84 billion in venture capital funding, as reported by the kingdom's SME authority.

A fintech startup in Saudi Arabia, Lean Technologies, has secured $67.5 million in a Series B round, with General Catalyst being the first venture capital firm from Silicon Valley to invest in the country.

General Catalyst has $30 billion in assets under management and has invested in major U.S. tech companies such as Airbnb, Stripe, and Square. Additionally, Lean Technologies' recent fundraising round saw participation from Bain Capital Ventures, Stanley Druckenmiller's Duquesne Family Office, and Arbor Ventures, bringing the Riyadh-based firm's total funding to over $100 million.

Three investors, including General Catalyst, Stanley Druckenmiller, and Bain Capital, have made their first investment in the kingdom.

According to Hisham Al-Falih, CEO and co-founder of Lean Technologies, the investment in Saudi Arabia signifies a significant vote of confidence in the country's growth trajectory and potential over the next decade.

The kingdom is actively pursuing Vision 2030, an initiative aimed at diversifying its economy beyond oil and creating new job opportunities for its young workforce. To achieve this, the kingdom is seeking foreign investment and capital inflows, which will enable local employment, knowledge transfer, and the growth of various industries.

Fintech plays a major role in this evolution, Al-Falih stressed.

"We are just beginning to explore the potential for growth in our tech stack, payment solutions, data services, and partnerships with banks in the region, with the support of central banks in the region," Al-Falih stated. "Despite the impressive growth in the region over the past three to five years, there is still significant potential for further expansion."

The fintech industry in the Middle East and North Africa generated $1.5 billion in revenue in 2022 and is projected to reach between $3.5 billion and $4.5 billion by 2025, according to a McKinsey & Company report. Despite this, fintech revenues in the region are less than 1% of banking revenues, compared to 4 to 5% in more mature markets like the U.S. and U.K., as stated by Al-Falih, citing the report.

"The CEO of Lean Technologies stated that we are significantly far from our potential in terms of fintech revenue and its contribution to the economy. This gap provides us with the momentum to continue developing the tools and resources necessary for innovative entrepreneurs to achieve their goals."

Lean Technologies offers the financial infrastructure for secure data-sharing between bank accounts and applications, regulated by Abu Dhabi Global Markets in the UAE. The company facilitates A2A payments, allowing funds to be transferred directly between two bank accounts without intermediaries like payment processors or credit card networks.

The company has over $2 billion in total processed volumes, as stated in its Sunday press release, and works with major local clients such as Emirati state telecoms firm e& and ride-hailing super app company Careem.

Nearly 1 million bank accounts have been verified by Lean's data solutions under the Saudi Central Bank's regulatory sandbox, impacting clients across various industries, including insurance, lending, and marketplaces.

Since 2018, Saudi Arabia's fintech startups have received over $1.84 billion in venture capital investments, with $791 million being attracted in 2023 alone, representing a 231% increase from the previous year, according to Monsha'a and KPMG.

Since the launch of "Fintech Saudi" in 2018, the number of active fintech startups in the country has increased to 216, with over 6,500 employees, Monsha'a stated. The Kingdom aims to create 525 new fintech companies by 2030.