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DUBAI, March 3 (Reuters) – Kuwait beauty e-commerce startup Boutiqaat is in early talks with banks to raise between $100 and $150 million in its latest funding round, tapping a burgeoning venture capital market in the Middle East, sources familiar with the deal said.

The company, whose platform offers virtual stores for Gulf and Arab celebrities and social media influencers to sell products they endorse, is fast growing and ranks as the one of most valuable technology start ups in the region.

Founded in 2015 by Kuwaiti entrepreneur Abdulwahab Alessa, Boutiqaat currently offers more than 25,000 beauty products for sale through its website and mobile apps, according to information on its website.

Last year, the company said it doubled its valuation to $500 million after a fundraising exercise, without disclosing the amount of money raised.

“They are in the market to raise money,” said an investor who spoke to the group, adding they could attract venture capital firms and family offices in the Gulf.

The deal could bring Boutiqaat’s valuation to anywhere between $800 million to $900 million, they said, moving the company closer to “unicorn” status, a term used to refer to start ups with $1 billion valuations.

The Middle East’s youthful population and high smartphone penetration has set the scene for a relatively active tech scene.

The Gulf Arab region saw a spike in venture capital raising last year especially after ride-hailing app Careem was acquired by Uber in a $3.1 billion deal, the region’s largest tech buyout.

“The central thesis for all of this is that software and digital technology is changing every industry,” said Jay Alammar, a partner at STV, a Riyadh-based $500 million technology fund.

“Careem’s exit is one indication of that tipping point, and then that gives the signal to investors about the commercial opportunity,” Alammar told Reuters.

STV was an investor in Careem and also recently backed truck delivery app TruKKer’s $23 million fund raising, as well as supporting Vezeeta, a regional doctor booking platform, which recently raised $40 million.

Last year was a record for start up investments across the Middle East and North Africa (MENA), with 564 investments and $704 million in total funding, according Magnitt, which captures data on startups and fund raising in the region.

However, the data excludes mega deals Careem and Dubai-based internet retailer Souq, which was acquired by Amazon for $580 million.

Ali Al-Salim, co-founder of Dubai-based Arkan Partners, a consulting firm specialising in alternative investments said the startup scene has been inspired by a lot of things such as the maturing of the market, the availability of funding and “of course a “me-too” effect after a successful Careem story”.

Written by Hadeel Al Sayegh and Saeed Azhar; Editing by Kirsten Donovan for Reuters

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