Asaak raises $30m in funding; partners with Standard Bank
Asaak, an African asset financing startup, has secured $30 million of debt and equity capital in part by a successful pre-series A raise. Asaak is the first investment in Africa for many of its US-based VC backers, underscoring the opportunity for a platform like Asaak to address the continent’s asset financing gap.
In addition to the fundraise, Asaak also announced that it has partnered with Africa’s largest commercial bank by assets, Standard Bank, to both finance and provide insurance for a portfolio of Asaak’s motorcycle loans. The partnership extends beyond the financing, with Asaak and Standard Bank working closely together to co-create complementary and innovative products for its customers.
The collaboration between Asaak and Standard Bank is a first of its kind, focusing on empowering entrepreneurs to have access to sustainable financial services, from an initial motorcycle loan to savings accounts, insurance, investment products and beyond. Through Asaak’s proprietary digital loan origination system and Standard Bank’s presence across the continent, the two companies are well poised to offer financial services to Africa’s 600 million informal workers and beyond.
“Standard Bank chose to partner with Asaak because of the strategic direction that the bank is taking, where we look at the underlying needs of the customers as opposed to just trying to push products. In this case, the underlying need of our customers is lack of mobility. Asaak is one of the only companies trying to tackle that problem using technology, which aligns well with our strategic direction – transforming into a platform business and a future-ready bank – with solutions for every customer type,” said Aaron Akampa, head of direct digital and e-commerce of Stanbic Bank, Standard Bank’s operation in Uganda.
Akampa added, “while we often underestimate the power of the boda-boda (motorcycle transport) on the continent, in many circumstances, it is an ambulance, a pharmacist, and a chef – it brings you everything you need. It takes children to school, it brings people to job interviews, it provides livelihoods for hundreds of millions of Africans. Ultimately, this is new ground for Standard Bank – we haven’t partnered with any other players in this space on the continent yet it’s the first time we are creating a partnership like this and we can’t wait to see what is ahead.”
In his remarks, Edward Egwalu, Asaak’s chief operating officer, said the partnership with Standard Bank marks the start of a joint journey aimed at improving the livelihoods of boda-boda drivers and business owners.
“Today we are disbursing the first set of bikes under our partnership, marking the beginning of a burgeoning relationship. Standard Bank’s partnership comes at a time when we are rolling out several new marketing campaigns and need additional capital to meet the growing customer demand. Our entire team from capital markets to operations to tech is working closely with Standard Bank to co-create new products for our customers. We are confident that this partnership will not only bring additional value for our customers, but will also accelerate our growth and product awareness,” said Egwalu.
Asaak embeds its alternative credit scoring technology onto ride hailing and e-logistics platforms such as Jumia, SafeBoda, and Bolt which allows access to proprietary performance and revenue analytics of mobility entrepreneurs to underwrite loans.
Asaak’s model is to provide loans to its customers by providing them with new vehicles and financing within three days of sign up. All of Asaak’s customers sign up to the Asaak app to manage all transactions and access other financial products on the platform.
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