Flouci: Tunisia's neobank
Building B2C & B2B fintech in Tunisia, methodically, with international ambitions.
Biography:
Nebras Jemel is the co-founder of Flouci, a Tunisian fintech offering a suite of B2C and B2B products. Today, over 250,000 Flouci accounts have been opened.
Nebras attended Harvard, but dropped out during his 3rd year and came back to Tunisia to pursue Flouci.
What problem are you solving?
I was the nerdy, hacker teenager type. I remember needing to buy a circuit board from the US but not being able to because Tunisian cards didn’t work internationally, so I couldn’t buy anything from e-commerce sites.
That thought stayed with me for years, until I moved to the US for university. There, I discovered fantastic B2C fintech apps like Venmo and wondered why we didn’t have them back home.
It wasn’t a tech-savviness problem: Tunisians, even older ones, would figure out how to use these apps. My grandma could use her smartphone just fine. Rather, the root of the problem was structural. I sought to find out what it was and build a solution to it.
What did your MVP look like?
Our inceptive vision was instant payments. We wanted to enable easy, quick, cheap payments between individuals in Tunisia.
Our MVP aimed for what Zelle does in the US. An intra-bank network, where we’d connect different banking APIs to allow instant payments between account holders. That ended up being a heavy lift regulatorily-speaking, so we decided to become a bank ourselves.
But we didn’t have a banking license. Instead, we “rented” a banking license from an existing local bank. However, we started generating such transaction volume that our “landlord” bank became worried that we’d expand into other services and cannibalize their own clients. Strategic alignment was no more, so we went back to the drawing board. We partnered with another, much smaller Tunisian bank that had more to gain than to lose from the transaction volume we’d bring in.
Flouci is a special case in a startup context. We never had a traction problem. Young people in Tunisia are starved for digital banking solutions, and we’re one of the only ones to offer that. The tough part is carving out a regulatory space to operate within.
How does “renting” a banking license work?
We do a revenue share with the bank whose license we use. All customers have an IBAN from the bank, but the bank can’t contact Flouci customers through its own channels. We maintain sole ownership of our client base.
Can you dive into your product’s chronology?
Our initial banking arrangement only supported B2C products, which we expanded heavily into. Today, we offer a full suite of B2C neobanking services (checking account, savings account, instant payments, bank transfers, physical/virtual debit card…).
We knew businesses would ultimately become our largest revenue driver. We noticed Glovo, a delivery app, was incentivizing its delivery drivers to get paid via Flouci to avoid using cash-on-delivery (COD), an operational nightmare. We’ve since gotten B2B licenses, such as a payment facilitator one, to expand into that segment. We aim to build a simple, online payment gateway enabling Tunisian businesses to get paid online.
RO insights: defining client persona for payment gateway
In countries where digital payment gateways are scarce, founders building them can be tempted to shoot very wide.
Gega Tsurtsumia, co-founder of Georgian startup Payze, explains why that was a mistake and how they’ve repositioned themselves:
“Founders are somewhat delusional but are quickly sobered up by operational realities. We tried to onboard as many businesses as possible (enterprise, SMEs, startups…) We wanted to become the payment method for every business in the region, as quickly as possible. 2021’s funding euphoria exacerbated our misplaced ambition.
We lost focus of who our real customer was. We were tracking the wrong metrics, focusing on growth rather than controlling churn and increasing average-revenue-per-user (ARPU).
We have since revised our positioning. We have cut down on startups and SMEs, doubling-down on enterprise clients. Today, we help multinationals (Zara, Massimo Dutti) and successful local businesses (MyTaxi, Setanta Sports) process their payments in the region. Having a restrained, niche customer base forces you to serve them with excellence.
We’d like to push into bigger, digital-first businesses that want to target the region such as Bolt, Wolt, Netflix, Spotify… We actually see ourselves closer to dLocal than Stripe.”
Excerpt from Payze: Stripe for the former Soviet Union, originally published in The Realistic Optimist
What have been some powerful growth levers?