Moove, an African mobility fintech that provides vehicle financing to drivers of ride-sharing platforms, has raised $105 million in new Series A2 financing.
This round was led by existing investors Speedinvest, Left Lane Capital and thelatest.ventures. The new investors were AfricInvest, MUFG Innovation Partners, Latitude and Kreos Capital.
Moove closed a $23 million Series A round and a month later closed $10 million in debt financing. The startup is present in six African cities, including Lagos, Accra, and Cape Town.
Most of the people in Africa have limited or no access to vehicle financing. The U.S. recorded 17 million new vehicle sales in the same year.
Most of the population own a car. Moove describes gig drivers and mobility entrepreneurs as those who can make money off owning cars, and they are looking to provide a long-term fix through vehicle financing.
Moove is an option for drivers who want to start their own ride-sharing service without having to borrow from car owners or take out bank loans.
Moove is the image credit.
Once verified, drivers sign up on the platform and are trained to sign contracts with Moove to access loans to buy or rent cars. The company deducts weekly rental fees from the drivers' earnings before transferring the balance to their accounts.
When drivers repay the loans at an 8% annual interest rate, they get to own the cars.
We have been able to provide financial freedom through vehicle ownership for some of our customers who have finished the programme in different markets, said Ladi Delano, co-founder and co-CEO.
We are still a young business. The people at 48 months are not done with their term. Some people who signed up very early in the business have been able to make purchases.
The chief executive didn't provide hard numbers on loan repayment for cars financed, the number of gig drivers using the platform, or revenue, which Delano said has grown 50% month-on-month from Moove-financed vehicles have completed over 3 million rides since it was launched two years ago.
This number is not exclusive to ride-hailing platforms. Moove has since expanded into several African cities after inking partnerships with providers like Uber.
The revenue-based vehicle financing platform says it will scale this model to gig drivers in other vehicle classes.
Moove will benefit from the new Series A2 round, as it will allow the company to scale across its current markets and also move into new markets outside Africa.
The co- founder of the company said that the problem of lack of access to financing for mobility entrepreneurs is not unique to Africa.
It is a problem in many emerging markets. The new round will allow us to scale into new markets and new regions, which is something we haven't been able to do before.
Moove is targeting seven new markets over the next six months. We go into these new markets to build businesses and meet our customers at their point of need.
Moove raises $23M to create flexible options for drivers to own cars in Africa
The total funding is $174 million in debt and equity. Delano argued that the amount wasn't enough to cater to the demands of the market. It has had to compete with different vehicle financing models in markets outside of Africa because of the large sum. Moove will face new competition from players such as Carro, Drover and France.
Moove is exploring the introduction of EVs for its mobility entrepreneurs, so at least 60% of the vehicles it finances will be electric or hybrid in the coming years. The average African can't afford these car models, but Moove's partnerships with manufacturers would make them affordable.
Adoption has been difficult for drivers in Africa due to lack of power and purchasing power. The company is using the investment to work on a more sustainable approach to launch EV solutions for its gig drivers in Africa and its new markets.
We have built a Nigerian solution for a global problem. That is exciting for us. Delano said that they have the opportunity to help solve the lack of access to vehicle financing problems for mobility entrepreneurs in Africa, but now they have the chance to take this Nigerian-born solution to the rest of the world.
This is something that we are proud of and we are excited. I hope that it will be the beginning of a lot more Nigerian born startups and solutions being able to solve global problems.
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