The Saudi Arabian startup Rize is poised to revolutionize the ‘rent now, pay later’ (RNPL) sector and is on track to significantly improve the efficiency of real estate transactions in the region.
Recognizing the high upfront costs that renters face in Saudi Arabia, Rize, founded by Ibrahim Balilah and Mohammed Al-Fraihi in 2021, has introduced a service that allows tenants to pay their annual rent in 12 monthly installments, while landlords receive the full payment in advance.
In an exclusive discussion, Balilah shared insights on the company’s mission to provide more flexible rental solutions and its current operations in major cities including Riyadh, Jeddah, and Dammam. Furthermore, the company is exploring opportunities to penetrate the commercial property market.
With a bold financial target to exceed SR50 million in rental requests by 2024, Rize has already attracted substantial interest, amassing around SR330 million in requests, indicating a strategic trajectory for scaling up to meet growing market demands.
Playing a pioneering role
Rize has established itself as a frontrunner in the RNPL market by being the first to craft an application that streamlines the rental process from start to finish.
The company is in the midst of expanding its technology to automate processes such as contract signing, tenant screening, and e-booking, making the rental experience smoother for tenants.
Balilah also emphasized Rize’s successful collaborations with property owners, which has granted them a diverse portfolio of apartments and bolstered their market position.
He detailed the company’s strategic funding efforts, including a $2.9 million seed round from various venture capital firms and angel investors. He explained that the selection of VCs was intentional, focusing on those with a follow-on investment strategy to ensure continued access to capital.
Plans for a Series A funding round within the next year have also been unveiled, aimed at sustaining Rize’s growth momentum.
Easing pressure on expats
Balilah underscored the importance of the rental market for the Kingdom’s hospitality sector, which is significantly influenced by the large expatriate community. He pointed out that the previous year saw Ejar contracts in the Kingdom amounting to over SR75 billion, reflecting the sector’s vibrancy.
He identified a key challenge faced by renters due to a lack of innovation and technology, which has led to landlords demanding the full rent upfront, causing financial strain for tenants. Rize’s model offers a solution by paying the landlord upfront and leasing back to the tenant on a monthly basis.
Through Rize’s app, tenants can apply for properties, submit personal information, and undergo a screening process. Once approved, Rize negotiates with the property owner and introduces the RNPL model, ensuring a smooth transaction for both parties.
Rize’s marketplace also offers a platform for renters to directly book through the application, a feature that aligns with the RNPL model.
The company has forged partnerships with major real estate developers such as Al Safa, Al Ramz, Makeen, Al Majdiah, and Al Ajlan Riviera, all of which have embraced Rize’s services. This business model has garnered interest from property owners, recognizing the potential to lease their units more swiftly.