Saudi Tech Startup Lucidya Raises US$6 Million To Fund Its Expansion Across The MENA Region The startup aims to provide its products to businesses in other Arab countries who face the same challenges that customers in Saudi face, which is the ability to analyze Arabic content in online channels.
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Saudi Arabia-based tech startup Lucidya has raised US$6 million in its latest funding round led by Rua Growth Fund, with participation from MAL Ventures and AlRashed Group, and other international venture capital firms. Existing investors also participated in the round, including VentureSouq.
Founded in 2016 by Abdullah Asiri, Lucidya is a social media analytics and monitoring tool geared towards Arabic brands, powered by artificial intelligence (AI) and natural language processing (NLP) technologies. The platform offers in-depth monitoring across websites, blogs, and forums, as well as evaluates interactions in English and all Arabic dialects, and generates insights for brands by analyzing customer data across all social media platforms. As a B2B software-as-a-service platform, Lucidya's solution aims to help brands in making data-driven decisions.
According to research by Martech Alliance, the global market for marketing technology solutions is worth around $344.8 billion last year, which serves as an indication of the growth seen in the industry. It's an opportunity that Lucidya is leveraging by its distinct focus on analyzing customer interactions in Arabic. Serving more than 100 enterprise customers in the UAE, Kuwait, US, UK, Iraq, Bahrain, and Jordan, the startup's reported annual recurring revenue (ARR) has grown five times annually.
This is part of the startup's long-term goals, notes Asiri, founder and CEO at Lucidya. "This investment is part of our company's master plan which was set a few years ago with the goal of reaching $100 million ARR in 2025," he explains. "Our master plan has a couple of pit stops for refueling to continue our exponential growth. This round was the second pit stop for us, which came after we reached the perfect product-market fit milestone."
Following the new capital, Asiri explains that the funding will be used to primarily expand the company's product offering to provide a wide range of features to its customers. The startup also aims to provide its products to businesses in other Arab countries who face the same challenges that customers in Saudi Arabia face, which is the ability to analyze Arabic content in online channels.
Related: On The Fast Track: Saudi Arabia's Entrepreneurship Ecosystem
Lucidya founder and CEO Abdullah Asiri, Rua Growth Fund Managing Partner Turki Aljoaib, iMena Group founder and Managing Director Khaldoon Tabaza and Lucidya CTO Zuhair Khayyat
Rua Growth Fund (RGF) joined as the lead investor owing to a number of factors, which included the firm's domain knowledge and investment philosophy, as well as the alignment of its values and vision with the Lucidya team. Asiri points out, "Unlike many other VCs in the region, the RGF team goes all-in when they invest in a company in terms of support and providing value add. They focus more on quality of investment than quantity in order to help the start-ups as much as possible."
Commenting on his firm's decision to invest in Lucidya, Turki Aljoaib, Managing Partner at Rua Growth Fund, says, "We at Rua Growth Fund believe that both, the Saudi market and the MENA region, have been underserved with technology solutions and services tailored to the local market. This has left significant gaps and opportunities for digitization that can only be successfully filled by local players who understand the needs of the market, and know how to deliver value to their customers." According to Aljoaib, Lucidya's solution is an example of this. "Having developed their technology in-house by and for Arabic speakers, they serve the needs of the global market while also demonstrating the Kingdom's potential of innovative tech entrepreneurs, which promises to be a key part of accelerating the Kingdom's growing leadership in MENA's tech revolution," he explains.
So, what's the road ahead for Lucidya? "Honestly, we are enjoying the journey at Lucidya and we hope it lasts forever," says Asiri. The mission to revolutionize customer experience in the MENA region hasn't changed, he says. "One main goal is that every B2C business in the MENA region (regardless of the industry or size) uses at least one product of our customer experience suite to help them satisfy and retain their customers. Businesses who are using Lucidya today are enjoying an improvement of 200% in customer satisfaction- we want to enable more businesses to reap similar benefits."
"TREP TALK: Abdullah Asiri, founder and CEO, Lucidya
What, according to you, is the message that Lucidya's newest investment sends to the MENA startup ecosystem at large?
"The Saudi market and the MENA region have been underserved with enterprise-grade technology solutions and services tailored to the local market. The reliance on international technologies is not only risky, but it also doesn't solve all customers' problems due to the lack of localization. Thus, I strongly believe this investment will have a great impact on the MENA tech ecosystem because it puts the spotlight on a successful example of Saudi startups solving enterprise- level problems using state-of-the-art technology which was developed in-house by and for Arabic speakers. I am confident that we will start to see many more solutions in this domain in the next few years."
What's your advice for entrepreneurs seeking investments for their enterprises?
Concentrate on your business first "Focus on creating a great business, not seeking investments. Accomplishing the former will make the latter much easier (and you might not need it anyways)."
Choose your partners wisely "Be selective on who you allow in your company as investors. Do proper reverse due diligence by asking portfolio company's founders."
It's not only about the numbers "Don't fall into the trap of seeking higher valuations at the expense of other terms (economical or control related)."
Start early- the earlier, the better "Start fundraising early. Plan for 6-12 months to close the round, and remember that seeking funds when you don't need it is much better than seeking it when you are on the edge."
Be clear on the legalities "Invest in a good lawyer to represent you in the round- someone who has experience in carrying out similar deals."
