Numida, which is incorporated in Canada and operates in Uganda, has raised $16.7 million CAD ($12.3 million USD) in a pre-Series A round.
Serena Ventures, the venture fund of four-time Olympic tennis champion Serena Williams’, led the $7.3 million equity portion of the round, with participation from Breega, 4Di Capital, Launch Africa, Soma Capital, Y Combinator, and existing investor MFS Africa, which is following on. Numida also received a $5 million debt facility from Lendable Asset Management.
Founded in 2017 by engineers Mina Shahid (CEO), Catherine Denis (COO), and Ben Best (CTO), Numida uses proprietary credit models and tech-enabled underwriting processes to provide unsecured working capital loans to micro and small businesses in Africa. Numida was selected to join Y Combinator’s W22 batch this year.
The International Finance Corporation reported in 2017 that Sub-Saharan Africa alone has 44 million micro, small, and medium enterprises. It also found that 51 percent of these businesses require more finance than they can access to grow their business.
This gap in financing is the opportunity that Numida sees across the continent, according to the startup.
“We serve small businesses that operate primarily in cash, lack verified transaction data, are semiformal and lack documentation, and lack collateral,” said Shahid. “Although this profile of business makes up the majority of businesses across Africa, they are heavily underserved by the traditional financial services sector and thus they can’t access the working capital they need in order to grow.”
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Numida’s claim to fame, according to Shahid, is how the startup figured out how to score and disburse unsecured working capital to cash-based businesses that have no digital transaction history. He said that Numida doesn’t rely on any digital POS or e-commerce marketplace data, allowing the startup to broaden its customer segment.
Since Numida’s $2.3 million raise in April 2021, the company claims that it has provided more than 20 million USD in unsecured working capital to 27,000 micro and small businesses in Uganda.
Shahid told BetaKit that Numida has raised about $16 million in total funding to date, comprising $10 million in equity and $6 million in debt.
This new financing, according to the FinTech startup, will be allocated towards reinforcing its Ugandan presence and launch in two new African markets. Numida noted some of what it considers “strong contenders” for the first phase of its pan-African growth strategy, with plans to make inroads to countries like Ghana, Nigeria, Egypt, and Kenya.
To support this expansion, Numida said it plans to double its team to 200 people across its credit operations, data product development and growth functions over the next 18 months. Shahid told BetaKit that four people out of its over 100-person workforce are based in Canada, with plans to expand its Canadian team to six by the end of the year.
Featured image courtesy of Numida.
