Kuda Technologies, a prominent fintech company operating in Nigeria and the United Kingdom, has raised close to $100 million in funding over the past five years. This achievement was announced by CEO Babs Ogundeyi during a panel session at the GITEX Africa conference in Morocco.
The GITEX Africa 2024 technology fair, held from May 29 to 31 in Marrakech, gathered over 1,500 exhibitors from 130 countries, including nearly 700 startups. During the event, Ogundeyi discussed Kuda’s growth and the difficulties African fintech startups face in attracting foreign investment.
“We launched in Nigeria in August 2019 and have raised close to $100 million within that period,” Ogundeyi stated during the panel session titled “Beyond the Starting Lane: Navigating Advanced Funding.” The session also included insights from Sacha Michaud, co-founder of Glovo in Spain; Yassine Oussaifi, partner at Africinvest Tunisia; and Katlego Maphai, CEO of Yoco South Africa.
Ogundeyi emphasised that African startups often struggle to secure foreign investment due to investors’ unfamiliarity with the local market. To address this, Kuda Technologies established its headquarters in the UK, which has facilitated easier access to Western funding.
“We are headquartered in the UK, but we are Africa-focused, and there is a reason why we are headquartered in the UK. It’s very much related to access to funding. The capital comes primarily from the west. It’s easier to attract capital in those jurisdictions,” Ogundeyi explained.
He noted that securing funding is particularly challenging in Africa due to low trust levels. “When we raised our seed funding, the majority of investors had not been to Africa before, making it difficult to connect with something they didn’t understand,” Ogundeyi said. “If you don’t have a feel for the environment or understand the psyche of the people, it becomes very difficult to connect resources to that region.”
Despite these challenges, Kuda Technologies has made significant progress. Its subsidiary, Kuda Microfinance Bank in Nigeria, has grown its customer base to 7.5 million users, making it one of Africa’s largest fintech companies. The company plans to expand further, with licences in Canada and Tanzania reflecting its global ambitions.
Sacha Michaud of Glovo echoed Ogundeyi’s sentiments, noting that venture capitalists prefer investing in regions where they feel more comfortable. “In every funding round, we had to convince our investors why we were focusing on the region when we could invest our resources in higher-return areas like Europe,” Michaud shared.
The discussion highlighted the ongoing challenges and strategies for African fintech startups in securing advanced funding, emphasising the importance of bridging the gap between unfamiliar investors and local markets.
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