Car ownership across Africa lags far behind the rest of the world largely in part to limited access to vehicle financing. Moove are out to change this.
Having recently raised a $23 million series A, they’re looking to democratise vehicle ownership by employing a revenue-based financing model with a cohort they’re calling “mobility entrepreneurs”- essentially anyone who uses a vehicle to earn their income.
The choice to serve this defined subset of customers is both altruistic and self serving. According to their co-founder Ladi Delano, he wants the company to solve some of the unemployment problems facing the continent within the transport industry. Moreover, instead of providing the service to the entire market who cannot guarantee a payback, why not target drivers who through their work can guarantee a payback.
With such a compelling offering, and some really nice cars to boot, Moove has been appointed Uber’s exclusive car financing and vehicle supply partner in sub-Saharan Africa.
It provides loans to these drivers by selling them new vehicles and financing up to 95% of the purchase price within 5 days of sign up. They can choose to pay back their loans over 24, 36 or 48 months, using a percentage of the weekly revenue generated while driving for Uber.
With most banks asking for at least a 10-15% down payment on a vehicle, Moove’s meagre 5% is a game changer. The net effective annual interest rate is also much better for the borrower. It’s no wonder Moove now operates in 5 cities across the continent and to date is responsible for over 850K completed taxi trips.
Representing at Y Combinator
In July we first wrote about the 9 African startup participants at the Y Combinator summer cohort of 2021. Since then another 3 have been added.
Out of Nigeria there is Payhippo, which offers loans to small businesses in Africa in under 3 hours and Infiuss Health, which connects EU and US-based pharmaceutical life science companies to participants for clinical trials in Africa.
Out of Ghana there is Yemaachi Biotechnology which is working to lower the financial costs of cancer by developing novel, non-invasive and affordable molecular diagnostics.
Digitising the wholesale-retail relationship
Omnibiz, a Lagos-based startup, recently raised a $3 million round to continue its market expansion. They’re a B2B e-commerce platform that connects fast-moving consumer goods (FMCG’s) manufacturers to retailers by digitising the supply chain that connects them.
Africa’s B2C retail landscape is well covered with players like Jumia, Konga, and Takealot all commanding growing customer networks. However it is the B2B landscape that is ripe for digital disruption. With over 90% of sales in Africa’s major economies deriving from informal channels the market opportunity is colossal.
Omnibiz offers retailers a mobile app, WhatsApp channel and a phone number that they can use to stock their shops. It operates an asset-light retail distribution model enabling key stakeholders in the supply chain to focus on what they do best.
For example, distributors can focus solely on warehousing and leave the transport element to one of Omnibiz’s third-party logistics providers. The platform enables a harmonious marketplace operation that keeps costs down whilst optimising for efficiencies.
In the news 🚀
🇳🇬 Nigerian logistics startup MVX has closed a seed funding round of $1.3 million to grow its product offering for the African trade and logistics sector.
🇪🇬 Teegara, an e-commerce startup based in Cairo has closed a five-figure pre-seed follow-on investment round to enable it to continue on its growth trajectory.
🇳🇬 Nigerian agritech startup Zowasel has secured $100K in financing from Guinness Nigeria and Promasidor Nigeria.
🇳🇬 Chekkit, who’s founder we interviewed two weeks ago, has raised a $500K pre-seed funding round to enable it to further expand its operations within the pharmaceutical and FMCG industries.