LBA: Valuation

Tabby’s Valuation Your Name Subject and Section Professor’s Name Starting its operations in 2019, Tabby has already taken the fintech market in the MENA region by storm, specializing in short-term installment services for middle class consumers. The following study aims to evaluate the attractiveness of investing in Tabby Company, given all these factors as a part of their operational history, market growth, and strategies. Our review is centered on a detailed assessment of Tabby's financial behavior, marketing strategies, operational techniques, and the sector dynamics within which the company operates. Business Assessment Comprehensive Business Assessment Financial Analysis Tabby's rise from the beginning to the top of the MENA region in the fintech sector is direct from various financial milestones that point out market viability and growth potential. Current investments are valued at around approximately $1.7 billion in total money since 2019 according to its current reports (Tabby.com. 2023). This one of the signals that shows real investor's confidence in the innovative business model. This substantial capital injection notably took the form of capitalization to scale the business, improve the technology infrastructure, and increase market coverage. Nonetheless, t is worth noting that despite significant investments, Tabby is still considered as a small startup considering that its current revenues are at $31.5 million, which is well within the threshold of $40 million for small businesses. Accordingly, it is also worth noting that the company's financial planning was primarily based on securing a $150 million credit facility from Atalaya Capital Management and PFG in August 2022 (Tabby.com, 2022). This is especially important since it is the first development of Atalaya Capital Management in the MENA region, which denotes the confident trust in Tabby's market position and business model. The facility is the GCC's largest credit facility, SCAF, secured by a fintech, indicating the investors' confidence in the ability of Tabby to manage and grow its financial resources responsibly. This credit facility serves multiple strategic purposes: On the one hand, this investment improves the company's operating profit and processing capability and supports its ongoing pursuit of product and market expansions (Kharub et al., 2022). Experts in the reporting said that this type of financing is fundamental for the BNPL companies, as it serves as working capital and offers funds for consumer purchases without harming the previous cash flow. For example, they are like Klarna and Afterpay, which also obtain huge credit lines to finance their customers' purchases and broaden their company's outbound. Additionally, the businesses providing BNPL facilities have financial leverage that helps them maintain favorable liquidity ratios, essential in ensuring proper cash flows and expansion without liquidating their business assets (Sieber & Guibaud, 2022). This financial management aptitude reflects Tabby's sober approach to financial issues, which plays a significant aspect during the unstable period of fintech, where markets can transform within a short period. Finally, the benefits of Tabby can also be seen in its effects on the retail and e-commerce space. This is the external evidence of Tabby's sound financials. As for instance, BNPL's rising purc...