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When Partners for Growth (PFG) first entered the Middle East five years ago, Armineh Baghoomian, Managing Director and Head of EMEA, remembers debt being a “frightening concept.”

The firm wasn’t new to frontier markets. Born out of JPMorgan in the early 2000s, and with roots in some of the earliest venture debt funds of the Bay Area, PFG had already spent years tailoring credit facilities for tech companies in places where equity had long dominated the funding conversation.

But in MENA, venture debt was still alien. When PFG closed its debut deal with TruKKer, boards and founders had little frame of reference for how leverage could be used productively. Baghoomian jokingly calls those the “prehistoric times.”

The pace of change since has been striking. Founders across MENA are now negotiating tailored warehouse lines and asset-backed facilities. Sovereign LPs like SVC and Jada have anchored PFG’s latest fund. Competitors are muscling in. And companies such as Tabby and Huspy have shown that debt, in the right structure, can accelerate growth rather than weigh it down.

PFG has been at the centre of that shift. Since 2020, the firm has committed close to $300 million to high-growth companies across the GCC; including BNPL unicorn Tabby, digital freight platform TruKKer, payroll and HR platform Bayzat, e-commerce player Syarah, home-financing proptech Huspy, and short-term rental platform Silkhaus.

Still, confusion remains. Baghoomian estimates regional literacy at “six or seven out of ten”, a huge leap from five years ago, but far from mastery. The wrong product can be just as damaging as the right one is enabling.

That tension is where PFG has staked its ground: in the nuance of structuring, where data integrity, discipline, and experience often determine who scales and who flames out.

I sat down with Baghoomian to discuss how PFG thinks about risk, why Tabby was obvious to them, the typical ranges she sees in the Gulf for spreads, fees, warrants, and covenants, the green (and red) flags they watch for when founders come knocking, and what excites her most about RNPL and B2B BNPL.

You launched PFG’s MENA strategy and now lead EMEA. Where is founder/board literacy on venture/growth debt today vs 2020 when you backed TruKKer, and what’s changed since then?

The prehistoric times, as I like to call them. I guess we did the first venture debt deal that would really qualify as such in the region, and then we did the first true asset-backed warehouse facility for lending platforms or fintechs.

At that time, we were used to focusing on underserved markets, so the literacy element was often in its infancy. And in this region, debt in general is a frightening concept. Conceptually, people aren’t comfortable with it, they don’t want any of it. We understood that going in.

It has evolved. I’d say if you look at a spectrum of one to ten, with ten being the most literate, the region is probably at a six or seven now, and it’s evolving quickly. That said, there’s still a lot of confusion because there are many different products in the market. We don’t classify ourselves as traditional venture debt. If you compare us to other platforms that have been around longer, our approach is very different – it isn’t cookie-cutter. Every deal looks very different.

They’re very tailored to each specific company. And we have the history to be able to do that relatively easily. Partners for Growth has been around for 21 years. We spun out of JPMorgan in 2004, but we also have nearly 20 years of history before that, when we were one of the very first tech lending funds born out of an investment bank in the Bay Area in the mid-80s.

Back then, we started developing products for tech companies that didn’t have access to funding for very expensive equipment, mainframes, computers, things like that. Over time that changed, but the need for tailored products remained. So we’ve always structured deals differently. We’ve seen it all: great successes, and fortunately very few problematic deals we had to work through. That history helps us really understand what companies need.

What’s also unique about us is that most of us are former operators. I spent 12 years as a CEO, CFO, and co-founder of tech companies in the Bay Area. So I appreciate what founders are looking for a bit more than maybe others who haven’t been in those shoes.

So back to your original question: literacy is improving. Globally, if you compare different geographies and their adoption of this product, this region is evolving the fastest. And there are lots of parties trying to find unique angles to enter the category. That’s great, we’re happy about it. For a long time, we were the only ones, and we can’t do everything. So it’s good to see others coming in.

From your perspective, what does the process of securing a venture debt deal actually look like? I’d love to get a clearer picture of how those opportunities typically come together.

It’s varied at different times. The first deal we ever did in the region, TruKKer, came through a referral from a strategic partner of ours, Silicon Valley Bank. We’ve worked with them for forty-some years.

They often go into new geographies and have clients there, but they can’t always provide the specific products those clients want because they’re not active in that region with that offering. So they referred TruKKer to us, and we did the deal.

That created a tidal wave, honestly. Word-of-mouth spread quickly. After that company and the press around the deal, everyone became very curious about the product. We soon started seeing everything. We did another deal right after, and from there the momentum built. Today we have clients in the region and close to $300 million committed.

So, it’s really a mix. But today, I’d say most of our deal flow comes from word-of-mouth from entrepreneurs and from the VC ecosystem, which we’re very close to.

I wanted to ask you about mandate. It was reported that Jada Fund of Funds anchored PFG’s last vehicle. How do sovereign LPs shape product design, risk appetite, or regional deployment? 

They expect you to participate in the ecosystem. When they looked at us – both SVC and Jada – they approached us because we had already been deploying in the region and were quite active. They had identified the category as critical for them and wanted to make sure there was a reputable international manager to help establish that asset class locally.

Their expectation is that you’ll deploy capital back into the region. I’m not sure how they benchmark the exact mandate requirements, but I can tell you we’ve already met ours several times over. And we’re happy to, we’re here because we want to be, not because we have to be. That makes a big difference.

Most of the sovereigns are doing that now. I don’t know the specifics for UAE sovereigns, but across the rest of the region, most require you to participate back into the geography.

Can I ask about some of the green flags when founders pitch you for venture debt, things like unit economics or data instrumentation? And on the flip side, what are some of the red flags you’ve come across, whether regulatory issues, negative contribution margins, or otherwise?

So for us, there are two broad buckets of deals we do, it’s just an easy way to categorise the types of facilities we provide. One is…

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