Egyptian startup Lucky, a super app for credit products, offers and cashback rewards, is planning to become very big indeed in the Middle East and Africa (MENA) region off the back of its recent US$25 million Series A round.
Founded in 2018 by Momtaz Moussa and Ayman Essawy, Lucky offers users access to a growing range of easy-to-use credit products, discounts, and cashback rewards, which can be used in person and virtually with over 20,000 local and global brands.
The startup has grown rapidly since inception, and now has the largest merchant network in Egypt as well as over eight million registered users. It has seen 250 per cent year-on-year growth in gross merchandise value, and recently expanded into Morocco.
Last month, Lucky raised a US$25 million Series A funding round to build out its credit capabilities, expand its market share, and drive further overseas growth. But what exactly makes it a “super app”?
“We offer credit, cash accounts with rewards, bill payment programmes and even pay later features, all with seamless app-based application and account management,” Moussa said.
“Users of our financial products also get access to a massive range of exclusive offers and savings on clothing, food and electronics through our merchant network – we have over 30,000 partners and counting including global brands such as Amazon, Jumia, Nike, Booking.com, KFC, Burger King, Spinneys, Metro, Sketchers, Ravin, B.Tech, and Tradeline as well as thousands of thousands of local brands. All of this can be browsed and redeemed in-app or with traditional bank cards.”
Moussa and Essawy are both serial entrepreneurs, who together previously built Dsquares, a B2B customer loyalty programme platform. With Lucky, they are targeting the Middle East and North Africa’s 250 million “underbanked” people, who lack access to credit as well as savings accounts. Meanwhile, 95 per cent of merchants in the region have not adopted consumer banking products, and transact only in cash.
“Having built a B2B loyalty/rewards company in the same region, we noticed there was a huge gap on the direct-to-consumer side,” Essawy said. “Many Egyptians, particularly young Egyptians, are very tech savvy and progressive, with global lifestyle tastes and aspirations, but their financial options just didn’t match the demand – these same progressive people tended to be significantly underbanked in what was still primarily a cash economy. The result was lack of access to both credit and financial products, as well as to the range of shopping and saving choices similar young people have grown accustomed to elsewhere.”
The pair are building Lucky to address that gap in a way that doesn’t just “cut and paste” the rest of the world’s financial products to the Middle East.
“We’re building an ecosystem that addresses the specific needs of the region,” Moussa said.
Uptake has been “remarkable”, by all accounts.
“We have gotten really great feedback, including an App Store award from Apple for best apps in Egypt, and young Egyptians are logging on fast. We have over seven million users already and currently process three million annual transactions with an annual gross merchandise value of US$60 million, and these numbers are growing fast. Our team has had to grow with it,” Essawy said.
Lucky’s current operations are primarily in Egypt, but after the recent expansion into Morocco the startup does have wider plans.
“Our mission is to bring a seamless shopping, saving and payment experience throughout the MENA region, and we are being deliberate and strategic with expansion priorities to ensure the best product-market fit as we grow,” said Moussa.
Lucky makes revenue from both the consumer and the merchant side. It takes a cut from each of the merchants on its network – 30,000 of them in counting – through transaction fees, and also collects fees for the financial products it provides. It hasn’t all been plain sailing, however.
“Lucky started as an in-store offers aggregation app, as that was where the biggest gap for our customers was at that time. Less than a year after we launched, the pandemic hit – suddenly all the stores were closed and everyone had to stay home! Obviously companies of all stripes have had to grapple with the changes the pandemic has brought to the way people live, save and transact, but this required a lot of agility, willingness to change and execution speed on the part of a very new startup. Overnight, Lucky needed to include online and delivery-focused stores, not just in-store offers,” Essawy said.
“In a way, though, this pressure wound up making us better. Because of the responsiveness and focus required of us at such an early stage, Lucky has grown with a structure and a culture that’s adaptable, that listens to its customers and that executes on its strategies both thoughtfully and fast – the very things we have needed to be to grow in this market. We’re very proud of how our team has not only handled this challenge but has used it to make us who we are,” said Moussa.