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Xpence plans to expand into at least 3 new strategic markets – Interview with CEO Ansari

Xpence plans to expand into at least 3 new strategic markets – Interview with CEO Ansari
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By: Omnia Ahmed

Mubasher: Building a business on solid unit economic is considered important by key players in the market. Meanwhile, startups as well as small- and medium-sized enterprises (SMEs) need access to financial services through a simple and accessible digital platform.

Through a specific digital app and internationally accepted business Visa cards, Xpence helps these businesses remove inefficient cash-based processes, while playing a role in raising efficiency, providing greater control and security besides ultimately saving money.

In an interview with Mubasher, Saad Ansari, the CEO and Co-Founder of Xpence, talked about being the first and only expense card app that is designed specifically for enterprises in the MENAP region. 

Ansari shared with the readers how they bootstrapped the company without any external partners since its incorporation in 2018, noting the COVID-19 pandemic which followed the founding of the firm.

Xpence received requests from companies in other markets and developed economies, such as the UK, highlighting how the Xpence solution has relevance all over the world.

The CEO said the company serves many enterprises across Bahrain and the UAE, while having more than 2,000 businesses on the waitlist. 

As for the metaverse, Ansari said it is something Xpence keeps an eye on, yet not actively pursuing at the moment.

Could you brief our readers on the journey from a consumer-focused financial solutions provider in 2018 to Xpence?

The original idea for Xpence came about when I encountered difficulties accessing banking services for my new business ventures in the region. The challenge made me realise that micro, small, and medium businesses need to have easier access to digital financial services – and that there was a space here for a company like Xpence to offer an effective solution. When we realised the scale of the challenge, over 23 million MENAP business struggle to access financial services, the Xpence journey began.

What challenges did you face when you decided to start the software business in the UAE?

Issues in accessing banking services formed direct inspiration for founding Xpence, and that’s one of the main difficulties that I encountered when first starting business in the UAE – and indeed across MENA.

Given how important access to financial services is when trying to build and scale a new business efficiently, my challenges made me appreciate how many fellow startups, freelancers, and even larger businesses, must be struggling as well.

You founded several businesses in Bahrain, the UAE, and Saudi Arabia. How do you see this experience?

Spotting opportunities in the market to offer something new and unique or even offering a better service. As an entrepreneur, you are always looking for gaps in the market. The challenge is knowing whether the problem is worth solving, i.e. is the problem big enough and are people willing to pay to solve the problem.

Do you plan to enter new regional markets in the near or far future?

In addition to the recent market entry in the UAE, Xpence also plans to expand into at least three more strategic markets over the next 18 months.

We are already legally incorporated in Bahrain, Egypt, Pakistan, and Saudi Arabia in addition to the UAE. With a mission to become the definitive business banking super app in MENAP, this is only the start.

How is Xpence helping startups and SMEs in the MENAP region to grow their business? By providing startups and SMEs access to financial services through an easy-to-use and accessible digital platform (via the Xpence app) and internationally accepted business Visa cards, Xpence helps these companies remove inefficient cash-based processes, increasing efficiency, providing greater control and security and ultimately saving money.

Additionally, our invoicing and automatic payment process solutions take another set of administrative tasks out of the responsibilities of business leaders, freeing up time to focus on growing their company and meeting the various other challenges they face.

Besides the funding rounds that the platform has already secured. Are you looking for additional fundraising in the coming period?

Yes, we are.

Do you think startups and SMEs in the MENA region can do without funding?

It’s certainly possible if the founders have a clear version and are dedicated to their mission. At Xpence, we’ve bootstrapped the company without any external partners since its founding in 2018– we’re only now seeking further funding.  When looking for external partners, I believe it’s really important that ethos and goals align, to give startups and developing companies the best chance of success.

It very much depends on the type of venture you are trying to launch. Yes, it is possible to bootstrap a business in the MENA region until it can run under its own steam. That’s why building a business on solid unit economic is important. However, there are times when external funding is required or you may reach a point in your journey when you need funding to accelerate the growth of the business. There are plenty of funding options in our region, but all require giving up part of your business. Therefore, when looking for external partners, I believe it’s really important that ethos and goals align, to give startups and developing companies the best chance of success.  

Which regional or international market do you think is more promising to your business?

At the moment, Xpence is understandably focused on MENAP countries. With a potential serviceable addressable market of over $13 billion in the region, there is plenty for the company to focus on.

However, while we’re focusing on MENAP in the short-term, we have already received requests from companies in other markets and even developed economies such as the UK, highlighting how the Xpence solution has relevance all over the world.

The COVID-19 pandemic quite started in line with the beginning of Xpence business. How did it impact the platform?

As has been widely discussed, the pandemic forced companies to move online – in some cases very quickly – and widespread restrictions on movement meant that digital financial services became increasingly relevant, and to many a necessity.

This dynamic undoubtedly helped to make the business case for Xpence, as we can help our customers digitalise their payment processes, making them more agile and fit for today’s online and interconnected world.

Xpence teamed up with Visa to launch its expense management solution in the UAE. How do you describe this partnership?

Xpence’s relationship with Visa has been in place for some time, even before the recent rollout of physical and digital cards in the UAE. The partnership began in 2019, when Xpence was one of the first fintechs in the region to join the Visa Fintech Fast track Programme. 

What is the current total business base Xpence is serving? And what is your future target?

Xpence is growing rapidly; already servicing many businesses across Bahrain and the UAE, with over 2,000 businesses also on our waitlist. 

What are the criteria you set to scale up your businesses in any country?

Like any other business we look at the size of the market and the demand from the market. These are probably criteria that most, if not all businesses, would assess before deciding which market to go into next. However, as Xpence offers financial services, we look at other criteria too such as barriers to entering the market, e.g. ease of getting regulatory approvals, local payments infrastructure, banking partnerships, etc. 

How far do you think metaverse can affect the digital payments and fintech industry? And how will Xpence deal with this wave?

The metaverse is something that we keep an eye on but are not actively pursuing at the moment. Companies entering into the metaverse need to have a proper strategy. There are definitely tremendous opportunities in the future for financial institutions in the metaverse – from customer service to digital payments. 

Do you think your platform has key competitors in the digital market?

I am confident that the Xpence offering is the most comprehensive and best suited to the need of our customers. 

After all, the company is the first and only expense card app designed specifically for MENAP SMEs.  Our proprietary technology and partnerships with banks across MENAP mean that our customers have a much higher level of strategic control and agility, regardless of where in the region they are operating. Similarly, our focus on regulatory approval means that we arguably have an edge in getting our services to market more quickly, in contrast to some of our competitors.

Additionally, our subscription and lending model is a significant competitive differentiator. Many competitors prefer to charge by transaction, while our SaaS offering gives customers more flexibility and helps to reduce up-front costs.

Finally, the track-record of my fellow co-founders and their experience in building and scaling successful businesses across MENAP is another tangible advantage for Xpence.