M-KOPA, a Kenyan company that provides asset financing services for the users has announced the raise of $75 million in Growth Equity funding.
The funding round was led by Generation Investment Management and Broadscale Group with participation from CDC Group, LGT Lightrock, LocalGlobe’s Latitude Fund and HEPCO Capital Management. This capital injection brings M-KOPA’s total equity funding to $190M.
Speaking on the round, Broadscale’s Managing Partner, Andrew Shapiro mentioned that the company’s approach to meeting the needs of customers was inspiring and in line with Broadscale’s mission.
“M-KOPA’s unique technology-enabled approach to providing essential consumer goods and financial services is an inspiring engine of empowerment perfectly aligned with our mission of Disruption for Good. The company’s rapid customer growth demonstrates the massive unmet demand in this sector, and we look forward to working with M-KOPA as they continue to scale their reach and impact across Africa”
M-KOPA plans to use the funding to expand into other African countries and also to go beyond asset financing, by scaling its financial services products such as health insurance, cash loans and BNPL merchant partnerships.
M-Kopa was launched in 2012 and is headquartered in Nairobi, Kenya. The company started as a wider pay-as-you-go (PAYG) solar market in the country. Over the years, the company expanded its offerings to include electronic appliances and smartphones to customers in Kenya, Uganda and Nigeria using its pay-as-you-go financing model.
M-KOPA’s offering costs an average monthly interest rate of 3.1%, lower than the typical interest rates offered by alternative sources of credit their customer base can access. To date, M-KOPA has unlocked over $600 million in financing and enabled 2 million customers to access a diverse set of products, including smartphones, solar lighting, solar-powered appliances and digital financial services such as cash loans and health insurance.
M-KOPA has recorded over twice its growth of new customers in 2021 and is projected to reach 3 million customers by the end of 2022. According to M-KOPA executives, M-KOPA has acquired over 50,000 customers in Nigeria and its recent launch in Ghana has shown an excellent growth rate.
In addition to Kenya, Uganda, Nigeria, and Ghana, M-KOPA has operations; the company plans to scale its footprint across the continent further. It will also strengthen its customer relationship and tech while scaling financial services products like health insurance, cash loans, and BNPL merchant partnerships.
Speaking on the round, Jesse Moore, M-KOPA CEO and Co-founder expressed excitement at the investment and the company’s ambition to increase its customer base.
“We’re thrilled to partner with leading global investors with deep experience supporting growth-stage companies as we expand our platform to serve more of our customers’ needs. Our innovative model means we have enabled financial empowerment for over two million people already through micro-payments, but there are still millions of people across the continent that are stuck with limited economic options. With this funding, we will expand to more markets across Africa and scale to over 10 million customers in the next few years”, he said.
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