Though dominated by fintech, Africa’s tech economy is carving out a new market that is showing signs of massive growth. The mobility sector is increasingly attracting investment interests from around the world.
Moove, Nigerian mobility startup has secured $20 million, 4-year structured credit investment from the British International Investment (BII), the UK government’s Development Finance Institution (DFI), formerly known as CDC Group.
Founded in 2019 by British-born Nigerians Ladi Delano and Jide Odunsi, Moove is democratizing vehicle ownership in Africa by providing revenue-based vehicle financing to mobility entrepreneurs.
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BII said the new funding would enable Moove to purchase and import brand new fuel-efficient cars into Lagos, which will be leased to drivers who can then earn their way to asset-ownership over a three to four-year period. It added that the funding is aimed at alleviating one of the key blockages to the development of ride-hailing transportation infrastructure in Nigeria’s commercial capital.
The investment was announced at a business reception co-hosted by Catriona Laing, British high commissioner to Nigeria and Nick O’Donohoe, chief executive officer of BII, on Wednesday in Lagos.
The event was held to celebrate the launch of DFI’s new name and reiterate its ambition to scale up investment that will boost economic sectors in Nigeria.
Speaking at the event, Laing said BII formed an important part of the UK’s package of tools and expertise to help Nigeria build their pipeline for investment and scale up infrastructure investment, in particular to achieve clean, green growth. She added that the UK government looked forward to seeing BII’s support expand and diversify in Nigeria.
In his keynote speech, O’Donohoe highlighted BII’s 74-year history in Nigeria, from its first investments in 1949 in West African Fisheries and Cold Store, to the organization’s pioneering role in supporting Nigeria’s first private equity fund — African Capital Alliance’s Capital Alliance Private Equity Fund I (CAPE I).
On how BII’s new five-year strategy is driving its investment in Moove, O’Donohoe said: “Investing in the prosperity of Nigeria’s growing population requires innovative new partnerships that can leverage the country’s abundant capabilities and expertise.
“I am delighted that not only will BII’s investment help to create jobs and provide entrepreneurial self-starters with the means to own their vehicles, but Moove’s clear focus on gender diversity will foster inclusive economic opportunities for women, both within the company’s workforce and among its drivers.”
In 2020, the transportation services industry group in Nigeria, Africa’s largest economy, had total revenues of $5.1bn, representing a compound annual growth rate (CAGR) of 5.4% between 2016 and 2020, according to data from market research firm Research And Markets.
Road transport accounted for 99.1% of the overall revenue, making it the most valuable segment of the market.
With a growing population of over 200 million people, whose mobility is narrowed to road transport, investors are seeing untapped goldmines in the emerging transportation market.
“We’re incredibly proud to welcome onboard a world-class partner such as BII, whose strategic support will play a key role in our mission to build the world’s largest integrated vehicle financing platform for mobility entrepreneurs,” Delano, co-CEO at Moove said about the investment.
“With our new funding, we’re now in an even stronger position to use our technology and productivity data in creating a more inclusive financing ecosystem, whilst also tackling the unemployment problem affecting over a third of Nigerians by generating the opportunity for more seamless and sustainable employment,” he added.