UAE crowdfunding platform Beehive has investors buzzing and businesses growing

Published November 18th, 2015 - 04:37 GMT

United Arab Emirates- based startup Beehive, an online marketplace for peer-to-peer finance, announced that it has helped around 50 small and medium companies in the country raise almost Dhs 25m in the last year.

Launched in November 2014, the Beehive platform uses P2P finance, based on crowdfunding technology, to directly connect investors with businesses seeking working capital to grow their business.

For SMEs, the site facilitates business finance solutions starting at Dhs 100,000 for up to three years.

Investors can join Beehive by setting up an account with Dhs 1,000 and can invest from Dhs 100 upwards into businesses listed on the platform.

Beehive then facilitates the loan agreement between the business and investors, charging a percentage fee of the loan amount. The business receives funding in around seven days and investors receive monthly repayments at target rates of between eight to 12 per cent.

Beehive said it currently has over 2,600 investor registrations.

In the last year, the company has seen two businesses complete a full repayment cycle, it said.

It has also received second applications for finance from seven existing SMEs on the platform.

Beehive has also launched an invoice finance product and a secondary market where investors on the platform can transfer existing finance parts between each other. The site also unveiled a Sharia-compliant investment platform in April 2015 targeting Islamic investors in the UAE.

Releasing a white paper on SMEs this week, Beehive said that a lack of funding to invest in innovation is a big barrier for local small businesses.

Over 50 per cent of survey respondents highlighted finance as a major enabler to innovation.

Chairman of Beehive Rick Pudner said: “When we launched, we were aware there was a funding gap for SMEs in the region, but we didn’t realize what a big impact this was having on innovation.”

The whitepaper also found that the government plays a key role in encouraging SME innovation with the establishment of free-zones and business-friendly regulations.

While the majority of innovation in the UAE comes from taking existing ideas and making them better, the most important thing that SMEs must do is to “invest into calculated innovation strategies”, it said.

Founder and chief executive officer of Beehive Craig Moore added: “It is particularly important for SMEs to explore different ways to innovate so they can compete in both a regional and global market.”

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