When Parthi Duraisamy was a consultant at McKinsey’s Dubai office, he discovered that the American Express cards his company relied on for corporate expenses were rarely accepted in the Middle East. This forced Duraisamy to cover significant travel expenses out of pocket and file endless expense reports.

“It was a constant pain,” Duraisamy explained on the call. “I’d spend my weekends uploading receipts, reconciling every expense manually.”

Now, Alaan, the company he launched with fellow McKinsey alumnus Karun Kurien, is the Middle East’s leading spend management platform. It just announced that it raised $48 million in Series A funding led by Peak XV Partners (formerly Sequoia Capital India & SEA) with participation from others like founders of 885 Capital, Y Combinator, 468 Capital, and Pioneer Fund.

Founders of some of Alaan’s unicorn customers, like Hosam Arab (Tabby), Mudassir Sheikha (Careem), and Khalid Al Ameri, a well-known YouTuber in the region, also invested.

This is one of the largest Series A rounds for a fintech in the region, compared to Saudi Arabia’s buy now, pay later platform Tamara, which raised $110 million a couple of years ago.

“The category has demonstrated strong product-market fit in the MENA region, and Alaan stands out as the category leader,” said GV Ravishankar, Managing Director at Peak XV. “Their customer-centric and product-led mindset has enabled them to build solutions tailored to modern finance teams.” (Peak XV also participated in a large Series B round last month, backing UAE’s proptech Huspy.)

Alaan’s path to category leadership wasn’t without challenges, however.

While the fintech raised a $2.5 million seed round in mid-2021, it couldn’t launch for nearly a year, largely due to regulatory complexities and the need for banking partnerships in the UAE. Its recent expansion into Saudi Arabia posed similar hurdles, taking years to secure approvals from the country’s apex bank before finally launching this January. 

“The biggest challenge we faced, both in the UAE and Saudi Arabia, was simply going live,” the CEO shared.

Yet, Duraisamy said the fintech was able to move fast in other ways such as in Alaan’s pioneering move to integrate Apple Pay into its B2B offerings, something previously unavailable to finance teams in the region. 

In early 2023, the company also claimed to be the first in the Middle East to integrate OpenAI into its services, a move Duraisamy says shaped the company’s current product strategy. Initially, Alaan rolled out a chatbot, anticipating that users would enjoy conversational interactions around their spending. But the feature failed to gain traction.

Lesson learned, the fintech shifted focus, realizing customers got more value when AI worked in the background. Alaan began using AI to help streamline processes like receipt matching, reconciliation, and VAT extraction—a particularly valuable use case in the region, where the platform helps businesses navigate complex VAT regulations and reclaimable tax.

The company claims its spend management platform has already saved finance teams more than 1.5 million hours of manual work. Its a number Alaan expects to grow as it continues to invest in automation.

Since launching in 2022, Alaan has processed over 2.5 million transactions for more than 1,500 finance teams across major regional enterprises, including G42, Careem, Tabby, and Lulu Group.

What’s more, the company is profitable, Duraisamy says, noting that it spent $5 million to generate $10 million in revenue. Duraisamy credits YC and his mentors for instilling a disciplined approach in a market where many fintechs are focused on payment volumes.

Now, Alaan is looking to replicate its growth in Saudi Arabia, where it launched earlier this year and has been doubling transaction volumes month over month for the past six months, according to the startup.

The Series A will accelerate this expansion, allowing the company to scale hiring across sales, customer success, and compliance, while also doubling down on AI-driven finance automation.

While the four-year-old fintech, which is equipping MENA finance teams with AI agents, has now raised one of the largest Series A rounds in MENA, I asked Duraisamy if Ramp’s explosive growth—its valuation has doubled this year after raising three rounds—played a role in investors betting big on Alaan.

“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 said. “We are not in a market where you know size is an advantage, like the US or Europe. So, regardless of whether Ramp was able to raise or not, I think we would have raised this much because our fundamentals were very strong.”