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Payhippo Raises $3M in Seed Round to Improve SMEs’ Access to Credit Facility

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Payhippo-Investors King

Payhippo, one of the leading SMEs lending platforms in Nigeria, has raised $3 million in seed round funding to improve access to credit facilities and source more talent into its team.

The seed round was led by the co-founders of African cross-border payments company Chipper Cash, Ham Serunjogi and Maijid Moujaled, founder of Flutterwave, Olugbenga Agboola, the CEO of investment banking firm Chapel Hill Denham, Bolaji Balogun, and the founder of Metis Capital Partners, Hakeem Belo-Osagie. Other angel investors include management from Paystack, Brex, and Tala and several LPs from Payhippo’s preseed investors. Institutional investors include TEN13, VentureSouq, and Prodigio Capital.

Payhippo, which is part of the 2021 Y Combinator summer cohort, was founded in 2019 by Chioma Okotcha, Zach Bijesse, and Uche Nnadi. The $3 million raised in the seed round is the largest amount Payhippo has raised to date after receiving $1 million in pre-seed funding earlier this year. The company has now raised a total of $4 million to date.

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According to the company’s co-founder and Chief Operations Officer (COO), Chioma Okotcha, Payhippo is looking to hire more engineers and data scientists. She said, “we capture our data from the loans we issue, and more talent in the team would allow us to optimize our technology to serve our customers better.”

Chioma also said the company ensures that the loan disbursement happens within 3 hours after approval, a record that seems unattainable in the traditional banking institutions in Nigeria.

“We really focus on keeping this under three hours and making sure that businesses can get the money they need when they need it. Ours is also a product that works for SMEs in terms of a flexible repayment structure.

“We had seen that traditional banks and lenders wouldn’t loan small businesses mainly because there were no credit scores, or the collateral requirements were too high. We decided to come into the market and create an instant financing option, where we create a credit score that allows small businesses to get the liquidity they need to buy inventory for business continuity,” Okotcha said.

According to the COO, Payhippo uses its own customized credit score formula to determine the value of loans accessible to each business. “We use data from historical records that borrowers have built with us, but we also check their banking history to see the actual performance of their businesses,” she said.

Payhippo says it is banking on its fast turnaround time for loan applications to grow its customer base within Nigeria before venturing to other countries. From inception to date the company is reported to have disbursed about 5,000 loans, valued at $1 million and with a repayment rate of 97%, generating about$64,000 in revenues.

She added that the demand for credit is high, fueling its current 25% month-on-month growth. The minimum loan disbursed is about $200 while the average loan disbursed stood at $1,300. “We know that just 1% of the Nigerian market is about 40,000 businesses, and we want to be in a position where we disburse 40,000 loans in a day,” she said.

Ham Serunjogi, Cofounder and CEO of Chipper Cash, said: “New financial technologies are being developed and implemented changing the competitive landscape in the financial sector in Africa. Access to credit is a critical necessity for small businesses to manage their daily challenges. Payhippo helps address this need through its innovative approach that provides loans to small businesses in less than three hours enabling them to have access to sufficient working capital to grow.”

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Fund Raising

Spleet Startup Raises $2.6 Million Seed Fund to Expand Its Property Management Products

Spleet, a Nigerian prop-tech startup that offers access to premium residential solutions, announced that it has raised a $2.6 million seed fund to scale its property management product.

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Spleet CEO Tola Adesanmi and COO Daniella Ajala

Spleet, a Nigerian prop-tech startup that offers access to premium residential solutions, announced that it has raised a $2.6 million seed fund to scale its property management product.

According to the company, it disclosed that the funds raised will be used to expand its product offerings for landlords, real estate brokers, and tenants across Nigeria and to explore other markets in Africa.

It also plans to expand its product offerings to include ‘Collect’, a service that automatically receives rent payments on behalf of landlords, as well as ‘Verify’ a tool that enables landlords and real estate agents to vet and carry out adequate background checks on tenants before offering lease agreements, and Rent Now Pay Later a no collateral affordable-interest rate rental loan product. 

The seed round was led by Mac Venture Capital as well as several other investors such as Noemis Ventures, Plug and Play Ventures, Assembly Fund, Ajim Capital, Francis Fund, and other angel investors including Proptech operators; Eduardo Campos and Paulo Buchicher of Yuca, Maajed Chaaaraoui ofinsurami.

Speaking on the recent fund raised, the CEO of Spleet, Akintola Adesanmi said “This funding would go into deepening our product offerings for Landlords, real estate agents and tenants across Nigeria and testing out new markets.”

“The housing crisis is an enormous problem that impacts us at a global scale, and Africa is no exception,” said Marlon Nichols, co-founder and managing general partner at MaC Venture Capital.

“In countries like Nigeria, the requirement for tenants to provide 12 to 24 months of rent payment in advance creates a barrier for large parts of the population in accessing the rental market and essentially renders them homeless.

“MaC is proud to partner with Spleet as it continues to bring forward a comprehensive solution that effectively serves both sides of the housing market and makes true deposits to combating homelessness.”

Since its launch in 2018, the proptech startup has handled millions of dollars in rent, sheltered more than 1000 tenants, and signed up more than 35 private and corporate landlords.

It should be recalled that on March 15, 2022, Investors King reported that Spleet raised $625,000 in an oversubscribed pre-seed round led by MetaProp VC.

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Venture Capital Firm Algebra Ventures Announce First Close of $100M Second Fund

Algebra Ventures has announced that it has secured the first close of $100 million and expects to reach a final close by the end of the first quarter (Q1) of 2023.

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Egypt’s leading tech venture capital firm Algebra Ventures has announced that it has secured the first close of $100 million and expects to reach a final close by the end of the first quarter (Q1) of 2023.

Last year in April, Algebra ventures secured a $90 million fund for startups in Egypt with an allocation for investments in the wider Middle East and Africa region. It was the sequel to it’s first $54 million fund invested in 21 startups across Egypt and the Middle East. 

When the Venture capital firm predicted that it would attain its very first close in Q3 2021, it however had to wait an entire year to achieve that. Nonetheless, the delay afforded Algebra Ventures adequate time to exceed what it initially earmarked for the fund.

The firm recently disclosed in a statement that it has finalized a $100 million first close and expects to reach its final close by the end of Q1 2023. 

Speaking of the recent funds raised the managing partners of Algebra ventures Tarek Assaad and Karim Hussein said, “Our second fund will pursue opportunities in various sectors by partnering with high-potential founders to address specific market gaps in these sectors.

“We haven’t made any investments in sub-Saharan Africa yet, but continue to build relationships in these markets,” added Hussein via email about the company’s prospective investments in neighboring markets”.

“We have seen ups and downs before and have been working closely with our portfolio companies to ensure that they have a solid financial position in this new environment.

“We continue to support our companies with strategic advice, funding, operational issues, and other matters as the need arises.”

Algebra Ventures is reportedly one of the few companies to have recently reached the first or final close of a large fund targeting the Middle East.

The Ventures capital firm reaching its first close at a larger size than its intended second fund is a colossal achievement. It highlights a decisive vote of confidence from investors in the company’s first fund.

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Talk360 Seed Round Reaches $7M After New Funding

Talk 360 has secured a combined $7 million in seed rounds to build a payment platform for Africa

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Talk360

South African startup Talk 360, a leading voice-over-internet protocol (VoIP) player in Africa, has secured a combined $7 million in seed rounds to build a payment platform for Africa.

In May this year, Talk350 had raised $4 million in a seed funding round led by HAVAÍC. However, with the startup’s recent raise of an additional $3 million, the total investment raised so far is $7 million.

The latest investors in this new round include Allan Gray E2 Ventures (AGEV), Kalon Venture Partners, E4E Africa, Endeavor, current lead investor HAVAÍC and a number of angel investors including Tjaart van der Walt and Koenrad Jonker.

According to Talk360, it intends to use this new funding to launch a pan-African payment platform next year and increase its share of the VoIP market.

The payment platform will connect “all payment methods” across the continent, creating a diverse pool of localized payment methods, enabling international and local businesses to sell to African-based customers.

The company said in a statement, “The new platform will allow users across the continent to buy products and services using any currency and more than 160 payment methods. It will also be opened to other merchants”.

According to the Co-Founder of Talk360, despite the existing digital payment methods scattered across Africa, the startup is going to offer something more remarkable by offering micro-entrepreneurship and income-generating opportunities to users.

His words, “Our mission is to bridge distance and connect lives by offering reliable, affordable, and easy-to-use digital services, delivered in a localized manner to all communities, particularly emerging countries, so they can connect to the world

“But we’re not just solving socio-economic issues: we’re also offering micro-entrepreneurship and income generating opportunities to our growing network of agents across the country.”

The startup also has a network of agents, including PesaPoint in Kenya and Flash in South Africa, which enable users to purchase airtime vouchers from over 750,000 physical points of sale.

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