AI Fintech Alaan Secures $48M Series A, MENA's Largest Round
Dubai-based Alaan, an AI-powered fintech specializing in spend management, has successfully closed a $48 million Series A funding round. This significant investment, led by Peak XV Partners (formerly Sequoia Capital India & SEA), marks one of the largest Series A rounds for a fintech company in the Middle East and North Africa (MENA) region. Additional participants in the round included founders from 885 Capital, Y Combinator, 468 Capital, Pioneer Fund, and notable regional entrepreneurs such as Hosam Arab (Tabby), Mudassir Sheikha (Careem), and influencer Khalid Al Ameri.
Alaan was co-founded by Parthi Duraisamy and Karun Kurien, both former McKinsey consultants, who identified a critical gap in corporate expense management within the MENA region. Duraisamy experienced firsthand the inefficiencies of traditional methods, where widely used corporate cards like American Express were often not accepted, forcing employees to cover expenses personally and endure laborious manual reconciliation processes. This personal experience became the impetus for developing Alaan's platform, which aims to streamline and automate corporate spending.
GV Ravishankar, Managing Director at Peak XV, commented on the investment, stating, "The category has demonstrated strong product-market fit in the MENA region, and Alaan stands out as the category leader. Their customer-centric and product-led mindset has enabled them to build solutions tailored to modern finance teams."
The journey to market leadership for Alaan was not without its hurdles. Despite raising a $2.5 million seed round in mid-2021, the company faced considerable regulatory complexities and the necessity of securing banking partnerships, which delayed its launch in the UAE for nearly a year. Similar challenges arose with its expansion into Saudi Arabia, where it took years to obtain approvals from the country’s central bank before finally launching in January. "The biggest challenge we faced, both in the UAE and Saudi Arabia, was simply going live," Duraisamy noted.
Despite these regulatory obstacles, Alaan demonstrated agility in other areas. The fintech pioneered the integration of Apple Pay into its B2B offerings, a feature previously unavailable to finance teams in the region. In early 2023, Alaan also became one of the first companies in the Middle East to integrate OpenAI into its services. Initially, an AI chatbot was rolled out for conversational spending interactions, but it failed to gain user traction. This led to a strategic shift, where Alaan focused on leveraging AI in the background to automate processes like receipt matching, expense reconciliation, and VAT extraction – a particularly valuable feature for businesses navigating complex VAT regulations and reclaiming taxes in the region.
Alaan asserts that its spend management platform has already saved finance teams over 1.5 million hours of manual work, a figure expected to grow with continued investment in automation. Since its launch in 2022, the company has processed more than 2.5 million transactions for over 1,500 finance teams across major regional enterprises, including G42, Careem, Tabby, and Lulu Group.
Remarkably, Alaan is profitable, having generated $10 million in revenue from $5 million in expenditure. Duraisamy attributes this disciplined financial approach to guidance from Y Combinator and mentors. The company is now focused on replicating its success in Saudi Arabia, where it has already seen transaction volumes double month-over-month for the past six months. The newly secured Series A funding will accelerate this expansion, enabling Alaan to scale hiring across sales, customer success, and compliance, while also intensifying its development of AI-driven finance automation.
Duraisamy emphasized that the investment was driven by Alaan's strong fundamentals rather than external market trends. "When you talk to investors, what really matters for a company at our stage is the fundamentals: how capital-efficient we are, how much revenue we generate, how strong our go-to-market motion is," he explained, highlighting that the company's inherent strengths were the key factors in attracting this significant funding.