The pros (and cons) of big stars backing your business

Wahed

As French footballer Paul Pogba becomes an angel investor and brand ambassador for Islamic fintech Wahed, we look at the benefits and pitfalls of celebrities from David Beckham to Jay-Z teaming up with brands

When global Islamic fintech Wahed announced its latest list of investors, Paul Pogba, the Manchester United and French international footballer, stood out.

His involvement in the New York financial services company’s latest $50 million Series B funding round, which was led by Wa’ed Ventures – the venture capital arm at Saudi Aramco Entrepreneurship Centre – may have raised a few eyebrows.

With average salaries running into multi-millions, top-level footballers are becoming the ideal angel investor. But linking up with a big name could come with a higher risk and reward equation for Wahed, analysts told AGBI. 

• Footballers who have invested in startups
• How stars can impact a business

Under the deal, which will support the startup’s current growth phase as it plans to launch an ethical neobank on its platform in the near future, Pogba also became a brand ambassador. 

Amal Alameh, head of consulting in the Middle East, Africa and India for Euromonitor International, said that given Pogba’s 10.1 million followers on Twitter and 54.3 million followers on Instagram, he has “definitely aimed the spotlight at Wahed, especially for investors in the region”. 

Alemah added: “This plays directly into the growing trend of influencer marketing. According to our lifestyle survey in Saudi Arabia, 54 percent of respondents stated they’d like to be actively involved in brands, and 35 percent of respondents stated that their social media is a trusted source of information.

“With consumers seeking brands that match them or their aspirations, they identify with celebrities, and vice versa. This partnership is likely to raise awareness of Wahed’s identity and overall brand equity in KSA and the region.”

Currently, Wahed offers individuals the chance to invest their money ethically in a quick, easy and affordable way. It has gained support steadily since its inception in the US with hundreds of thousands of clients globally across all its entities.

Martin Roll, a global business strategist, and facilitator to Fortune 500 companies, Asian firms and family-owned businesses, said: “It’s big news that global football icon Paul Pogba has invested in Islamic fintech Wahed and becomes their brand ambassador. 

“It is a high-profile celebrity endorsement that can work out well for both parties if managed and governed well.

“Global sports icons often invest in brands and fast-growing companies to further expand their wealth, diversify their investments and risks, and widen their portfolios of asset classes. 

“This particular investor class comes with special high awareness and high expectations. The rewards can be extraordinary, but the risks can be unusually high, too.”

The CEO of Singapore-based Martin Roll Company, added: “Pogba is a football icon and an attractive brand for Wahed to be associated with on a strategic level. It’s important he keeps his attractiveness, which is primarily his results in sports. 

“The risk is that he fails to deliver in football matches and will be viewed as less attractive. Once Wahed is affiliated with his name, it will stick to their brand – also in the event that things turn less attractive.”

New York-headquartered Wahed is licensed in nine jurisdictions through its subsidiaries around the globe, with 11 offices serving more than 300,000 customers.

As well as Pogba’s investment, Haroon Mokhtarzada, founder of unicorn fintech Truebill, William Haney, chairman of Enhesa and Lori Richards, former director at the SEC, have also been appointed to Wahed’s board of directors to assist with the latest phase of growth.

Sunny Singh, managing director of Dubai-based Collaborate Sports & Entertainment, said: “Paul Pogba’s endorsement of Wahed is an interesting one as it comes at a crucial time for both the player and the brand. 

“The brand has only recently launched while Pogba is at a career crossroads, leaving Manchester United (again!) to reportedly head back to Juventus for a second time, and also releasing ‘The Pogmentary’ on Amazon Prime Video. 

“With a World Cup on the horizon and the lead role Pogba is likely to play for France, he will be very visible, so an opportunity for Wahed to capitalise on through association with their new star ambassador. Particularly if he has a great tournament.”

He added: “With his Islamic background, an association to Wahed on the surface seems a great opportunity. 

“As well as the likely commercial benefit of such a brand partnership to the player, the brand has an educational message about people learning to manage their money, however small or large through their product offer.

“Pogba is helping to raise awareness in this area that may impact many.”

Ted Church, principal, co-founder and branding specialist at US-based Anthem Branding, said: “It’s no secret that celebrities are a powerful marketing tool. 

“It’s no surprise that brands are using them as spokespeople to promote products, boost sales and engage with customers. They have a following that is willing to buy anything they endorse. 

“Brands can utilise the fame of celebrities to help grow their own brand and reach a wider market by tying themselves to the celebrity’s likeness. 

“Celebrity branding is not just about using a famous person’s name or photo as your brand, but it uses celebrities’ social media accounts, digital footprint and other connections with brands, organisations or charities.” 

He cautioned: “The brand should be providing as much value as it is getting out of the partnership, otherwise, it can fall flat.”