Lipa Later, a Kenyan opt-now-pay-later (BNPL) company, has raised $12 million pre-series A to build higher across Africa. This brings the company’s total funding to about $16 million up to now.
The funding, which is a mixture of equity and debt, become as soon as co-led by GreenHouse Capital and Lateral Frontiers VC, which led the company’s seed investment. The round additionally seen participation from Cauris Finance, SOSV IV LLC, Sayani Investments, and Axian Monetary Providers.
The company acknowledged this recent fund will enable them to present their opt-now-pay-later services to its original pipeline of buyers, solidify their presence in original markets—Kenya, Uganda, Rwanda—and build higher into recent markets akin to Nigeria, South Africa, Ghana, and Tanzania.
Founded in 2018 by Eric Muli, Lipa Later started as a programme to abet inside of workers entry cellphones that’d enable them to be efficient at work. Muli had before every thing founded Alpha Force Security Ltd, an organization that dispatches security guards to homes and locations of work in Kenya.
In 2017, Alpha Force started a mobile phone financing programme for their workers—namely their guards—but figured available become as soon as no company offering a mobile phone BNPL resolution, so that they determined to form out it themselves.
“We started taking a check around to keep aside a question to if there’s a BNPL platform within the sigh, but there become as soon as none. So, at that time, we just did it ourselves,” Muli told TechCabal over a call.
In 2017, there become as soon as no BNPL company centered on cellphones in Kenya; these readily available, like M-Kopa, are mostly into solar energy. So Lipa Later capitalised on this throughout 2017 and set a complete bunch of cellphones within the fingers of their workers and later exterior folk.
Serving to their workers to get cellphones become as soon as a extra or less pilot; it introduced them shut to the market and, which skill, they realised that for one and all Alpha guard that bought a phone, there had been a complete bunch of folk birth air who wished one but couldn’t maintain enough money it. So, after a minute overview, Muli and his crew grew to remodel particular that they would well lengthen this resolution to extra Kenyans; and in 2018, they constructed a tech-enabled product and launched it to the public.
Interior 3 years of operation, Lipa Later extended its provides into extra retail alternatives like electronics, furniture, dwelling dwelling equipment, and heaps others.
Moderately about a than the passe offline system of buyers buying items in retail outlets, Lipa Later has tapped into the rising on-line presence across Africa and constructed a distinct BNPL probability API that integrates into e-commerce platforms and permits merchants to promote merchandise on to buyers and pay for them in cheap monthly installments.
“Lipa Later is now not a BNPL platform for biggest telephones; it’s for anything else that is retail. When we started off, we had been doing issues heavily manually. However we’re now entirely tech-enabled; we mix without lengthen into e-commerce platforms and price gateways.”
Muli acknowledged the company additionally provides an offline resolution for the merchants and minute-scale retail outlets that maintain now not but moved on-line. He additionally acknowledged Lipa Later has served about 200,000 possibilities so far and maintained a 100% year-on-year boost.
Lipa Later’s proprietary credit ranking scoring and machine finding out way enable the patron to test in and get a credit ranking limit in seconds without the need for elephantine documentation and a lengthy credit ranking approval route of.
Talking about the investment, Samakab Hashi, Partner at Lateral Frontier VC, one in all Lipa Later’s first and lead investors, acknowledged, “Over the previous few years, we’ve watched Eric and his crew set together the constructing blocks for pan-African growth, and this round of funding takes Lipa Later one step nearer to being the dominant BNPL player on the continent.”
“We are enraged to be working with our investors as we check to grow and build higher to extra markets in Africa. Within the following 12 months, we are taking a check to grow and double our presence within the existing markets, at the same time as we birth in 3–5 recent markets in Africa,” Muli acknowledged in a assertion made readily available to TechCabal.
“Lipa Later is now not biggest changing the patron credit ranking panorama across Africa, which up to now has been largely inaccessible for most, but additionally catalysing the system forward for browsing, e-commerce, and funds,” acknowledged Ruby Nimkar, Partner at GreenHouse Capital. “They’ve carried out this in a just product- and buyer-led system that advantages each merchants and buyers and has confirmed to be incredibly scalable across just a few markets.”
The BNPL circulate is waxing real in Africa and so is the competition it brings. Lipa Later, even supposing it’s one in all the early corporations within the condominium in Kenya, has moderately heaps of corporations with the capital struggle chest to contend market share with. There may per chance be M-Kopa—which maintain since expanded into telephones and retail merchandise—in Kenya and Uganda. There are additionally CDCare, PayQart, Carbon, and even M-Kopa in Nigeria, the keep aside it just went survive Monday. In South Africa, there are PayJustNow and Payflex—which become as soon as just now not too lengthy within the past obtained by Australian BNPL Zip.
However Muli become as soon as optimistic that they don’t biggest maintain what it takes to compete but to emerge as trade leaders within the recent market. One in every of Lipa Later’s cards is its big fluctuate of exclusive merchants and world-properly-known brands akin to Carrefour, Apple, Tecno, Samsung simply to indicate about a, a methodology it has old to cease atop the market in East Africa and one it intends to protect along to the recent markets.