Digital payment Startup, Kudi, has secured a Series A funding that will enable the company to fast-track its expansion across Nigeria. The company raised $5 million from several existing investors.
Purpose of the fundraising:According to a press statement issued to Nairametrics, Kudi intends to increase its network of bank agents stationed across Nigeria. The fund will also afford the company to launch financial services in partnership with banks and fintechs, all in a bid to serve millions of Nigerians.
The financial products include: savings, loans, insurance to both small and informal businesses and individuals.
Why Kudi matters: Majority of the transaction in Nigeria still rely largely on cash. Moreover, Kudi believes that digital solution alone cannot drive financial inclusion. Instead, Kudi‘s agents are needed to achieve the objective.
According to the statement:
“Ninety per cent of all transactions in Africa still rely on cash. More specifically in Nigeria, 80% of the population works informally and is paid cash in hand. With figures still as high as this, digital solutions alone are not enough: Kudi’s agent network bridges this gap.
“Kudi’s mission is to make financial services accessible and affordable for all Africans. Kudi does this by enabling underbanked and unbanked Africans access to basic financial services like money transfers, bill payments and cash withdrawals through an agent’s network. Since its launch in January 2017, Kudi has grown its agent network to over 4,500 merchants and is adding new agents every day. The company makes it easy for agents to sign-up and have more visibility into their day-to-day operations. They process over $30 million in payments each month.”
Investors who participated: The Series A fundraising was led by Partech and joined by Michael Seibel (YC CEO). Also, Khosla Ventures and YC participated.
New appointment: Meanwhile, the General Partner at Partech and Co-lead of the Partech Africa Fund, Tidjane Dème, will join Kudi’s Board.
Kudi and Partech’s reaction to the Series A fund
The Co-founder and Chief Executive Officer (CEO) of Kudi, Yinka Adewale, said the company will now focus on building on its impressive performance by increasing its workforce with 15 new members.
“We’re excited about the growth we’ve experienced over the last 12 months. We literally grew from processing $1.1M to $30M monthly with the same team.
“Going forward, we’ll be hiring engineers, product managers and product designers to ensure our product is 10X better than what’s on the market today even as we grow our network of agents”, says Adewale.
The company currently accounts for 4,500 merchants and is adding new agents every day.
While for Partech‘s General Partner, Tidjane Dème, Agent networks are important in the spread of digitalisation in Africa, so Partech believes in the objective of Kudi, which he said has produced impressive growth since their inception.
“Agent networks are the backbone of African digitization as they offer an effective way of distributing digital services. We believe that Yinka and Pelumi have the right vision to build the best platform for agent networks.
“The Kudi team has built an excellent product that their agents love to use. As a result, Kudi has demonstrated an impressive growth since its inception.”
Meanwhile, Y Combinator‘s Michael Seibel said the growth of digital payments in Nigeria will be accelerated by Kudi which is serving as a middleman between cash and the digital payment system.
“For an economy that largely depends on cash, the growth of digital payments in Nigeria will be accelerated by Kudi as they provide a gateway between cash and digital, and we think that’s a huge opportunity.”
Kudi‘s mission is to make financial services accessible and affordable for all Africans. Kudi does this by enabling underbanked and unbanked Africans access basic financial services like money transfers, bill payments and cash withdrawals through their agent network. Kudi, a YC alumni, was founded in Nigeria in 2016 by Yinka Adewale (Co-Founder, CEO) and Pelumi Aboluwarin (Co-Founder, CTO).
About Kudi’s founders
Yinka Adewale is a graduate of Obafemi Awolowo University. He co-founded Sanwo Touch2pay, originally a payment platform for university students in Nigeria and he co-founded clinicfy, a cloud-based financial software for hospitals to track their revenues and invoices.
Pelumi Aboluwarin is a Machine Learning and Software Engineer. He previously co-founded Qwikgist, a news aggregation service acquired by Businessday and worked in a variety of software engineering roles for companies like Nexmo (acquired by Vonage) and Jumia (they recently filed for an IPO on NYSE).
Partech is a global investment firm with offices in San Francisco, Paris, Berlin and Dakar. They bring together capital, operational experience and strategic support for entrepreneurs at seed, venture and growth stages across multiple continents, with over $1.2 billion investment capacity.
Investments range from $200,000 to $50 million in a wide range of technologies and businesses for enterprises and consumers, from software, digital brands and services, to hardware and deep tech across all major industries. Companies backed by Partech have completed more than 20 initial public offerings and more than 50 strategic exits above $100 million.