Africa is home of more than one billion people, where the majority do not have access to financing. Africa has the lowest per capita vehicle ownership. Africa sold fewer than 990,000 vehicles in 2019. In the same year, the United States sold more than 17,000,000 new cars.Owning a car in Nigeria is something that very few people can afford. This is the case in Africa, where car owners recycle their old cars among themselves due to difficulty accessing new vehicles. Moove, an African mobility firm with a fintech focus, is seeking to change this and has raised $23 million in Series B to scale quickly across Africa.Ladi Delanno and Jide Odunsi founded Moove in 2019. Delano spoke with TechCrunch to say that he and Odunsi were trying to find solutions to the problems in Nigeria, after many years of successful businesses. However, they were shocked by the following figures: less than one million cars sold on an entire continent, and more than 17 million in the U.S.We realized that Africans don't buy cars because they lack access to financing. If you go to any other country, financing is available in almost all parts of the developing world. The same applies in the UK, Europe, and the USA. Delano stated that this is what drives vehicle sales and mobility drive.It was a daunting task to fix this deficit, so the founders decided that an asset financing model would be the best approach. Moove claims it is democratizing vehicle ownership through a revenue-based vehicle finance model. This applies to a small subset of Africa's driving population: mobility entrepreneurs.Why should mobility entrepreneurs be more important than the general population? TechCrunch's Delano says that Moove is changing the way people in Africa have access to cars. He also wants the company to address the problems of unemployment in Nigeria.Instead of offering the service to everyone, but only those who can't guarantee a return, why not focus on mobility entrepreneurs? They would be able to use the opportunity to work, and then generate income that will pay back.Mobility entrepreneurs are drivers who work in the mobility sector (car-hailing/ride-hailing/bus-hailing), among other things. Delano believes that although they are a small percentage of Africans who require Mooves services only a few, the market for mobility entrepreneurs can be huge.Uber's exclusive partner in sub-Saharan Africa for vehicle financing and vehicle supply is Moove. It embeds its credit-scoring alternative technology, which allows access to proprietary performance analytics and revenue analytics in order to underwrite loans. These drivers can get loans by the company selling new vehicles to them and financing up 95% of their purchase within five business days of signing up. You can pay your loans in 24 or 36 months. Or, you can use a portion of your weekly Uber revenue.The Mooves loan repayment process makes it more convenient for drivers than the traditional market. For example, Nigerian banks are known for collecting a deposit of 10-50% from drivers. Moove claims it charges 5%. There is also a significant difference in the annual effective interest rate. Nigerian banks typically charge 20-25%, while Moove charges between 8-13% and 25-25%.When you take into account the term of a vehicle financing loan Nigerian banks seldom offer a repayment period of more than two year. The maximum term for Mooves is four years. Delano stated that the company plans to increase the repayment period to five years in the long-term, which would be more comparable to the West.Moove will finance other types and classes of vehicles in the next few months, including trucks and buses.Although Moove was established in 2019, its full launch didn't occur until June 2020. Moove has grown rapidly in its first year of operation. The company has its headquarters in the Netherlands and operates in Lagos, Accra, Johannesburg. Moove currently has more than 19,000 drivers on its platform and up to 13,000 people are waiting for their driver. Delano claims that Moove-financed vehicles have completed more than 850,000 Uber rides and that the company has grown by 60% month-on-month.Moove raised a seed round of $5.5 million last year. The founders received the majority of the funding, along with Iyinoluwa Aboyeji (co-founder of Andela, Flutterwave, as well as a key partner in the company). Moove revealed that it had raised $40 million in debt financing to bring its total funding up to $68.5 million.Left Lane Capital and Speedinvest led the Series A round. DCM, Clocktower Technology Ventures and thelatest.ventures were also involved in the Series A round. Many of the round's U.S. backers are first to invest in Mooves.Moove is fast becoming one of the most innovative tech companies in Africa thanks to Jide and Ladi at the helm, as well as their unique approach towards vehicle financing. Stefan Klestil, general partner at Speedinvest said. The rapid expansion of the company to three cities in less than 12 months is a testament to the demand for vehicle financing in Africa. Only five percent of new cars in Africa are bought with financing, while 92 percent in Europe.Delano and Odunsi, both British-born Nigerians, were educated at Oxford University, London School of Economics and MIT. Delano is an entrepreneur since childhood. Odunsi was, however, an investment banker at Goldman Sachs as well as a McKinsey management consultant.They reconnected many years later (since they parted ways as teenagers) to start Grace Lake Partners, a venture firm. In the past decade, Grace Lake Partners has built three successful non-tech businesses in Africa. Moove was their first venture into tech, and Delano describes it as the fastest-growing business he's ever owned.Moove will be able to expand and grow in new markets with the Series A funding. The funding will allow Moove to launch new products and services that are aimed at increasing its market share in a highly competitive market where South Africa's FlexClub and Nigeria's Autochek have made significant progress.Delano believes that Moove's unique ability to get drivers new cars rather than used vehicles is what gives it an advantage over other companies. Delano also stated that the company is working towards hybrid and electric vehicle fleets. This new product line was created to help mobility entrepreneurs that need fuel-efficient vehicles and combat climate change.How will EVs become affordable for Uber drivers in Africa? Delano argues that Moove's strong negotiation power with its OEM partners, and the debt financing raised allow it to buy new EV vehicles and resell them to thousands of drivers at a lower cost. In the next few years, the company hopes to have at least 60% of its vehicles be electric or hybrid. It also aims to increase gender inclusion by increasing its female driver base to 50%.One of Mooves future plans involves creating wallets that drivers can use to accept and make payments. This feature is currently only available in Ghana, but it will soon be available in other markets.Dan Ahrens, managing partner of Left Lane Capital, stated that Mooves technology is revolutionizing mobility and giving thousands the opportunity to make a living. We are excited about the future potential of Moove technology and its team. They have the potential to grow their offering to financial services and become a full-service mobility fintech.
