Asaak raises $30M pre-series A funding. The Ugandan asset financing startup, has raised $30 million in pre-Series A equity and debt funding.
Resolute Ventures, Social Capital, HOF Capital, Founders Factory Africa, End Poverty Make Trillions, Decentralized VC, and a number of angel investors were among the new and existing investors in the round.
Asaak provides motorcycle financing to operators who are frequently turned down by traditional banks due to demanding security requirements such as income history and consistent account activity.
The company collaborates with a variety of partners, including mobility and e-commerce platforms, to make motorcycle ownership more accessible to riders who make a profession running motorbike taxis (bodaboda), a common mode of transportation in Africa, particularly in big cities like Kampala.
Bodaboda operators can now own the motorcycles they ride thanks to Asaak, whereas earlier, most of them were either employed by bike owners or rented or leased motorcycles.
“Asaak is enabling mobility-based labor, which is literally moving the economy forward and providing upward mobility for these people.”
“The lifeline of Africa is the bodaboda, which transports people and goods from home to school and work.
“All they need is access to motorcycles,” Asaak co-founder and chief business officer Dylan Terrill told TechCrunch.
“This leads to improved earning prospects and allows them to care for their families.”
The company certifies riders for motorbike finance using behavioural and financial data from platforms such as Bolt, Jumia, Safeboda, and Uber, such as earnings, trips taken, and ratings.
Asaak produces a credit score for debtors using rider data from these networks.
Borrowers can also check their eligibility for borrowing by using the Asaak app or visiting their local branch.
After a time of lending to farmers and SMEs, Asaak, which began operations in Soroti, Uganda in 2016, shifted its focus to motorbike finance in 2019.
The company has so far funded the acquisition of 5,000 motorcycles and has begun supplying the operators with smartphones and fuel funding.
“By financing these types of assets, we’re not only providing a road to vehicle ownership, which is beneficial in and of itself, but we’re also providing a reliable source of income due to the reliance of drivers in the nations where we operate.”
They’re collaborating with Samsung to encourage motorbike taxi drivers to get smartphones.
Last month, the company announced a new agreement with Untapped Global, an emerging markets investment firm, to offer financing for over 2,000 motorcycles over the next year.
Today, the startup has partnered with Standard Bank, a South African bank headquartered in Johannesburg with a presence in 20 African countries, to provide financial services to millions of workers in the informal sector (such as motorcycle taxi drivers) using the startup’s proprietary digital loan origination system.
As a result of this partnership, Asaak consumers will have access to customized financial and insurance services.
“While we frequently underestimate the strength of the boda-boda (motorcycle transport) in Africa, it is an ambulance, a chemist, and a chef — it provides you everything you need in many instances.”
It transports children to school, people to job interviews, and offers livelihoods for hundreds of millions of Africans,” said Aaron Akampa, head of direct digital and e-commerce at Stanbic Bank, Standard Bank’s Uganda operation.
“Ultimately, this is new territory for Standard Bank – we haven’t worked with any other players in this sector on the continent yet – it’s the first time we’re forming a partnership like this, and we can’t wait to see what lies ahead,” Akampa added.
Asaak wants to reach six more African markets in the near future as a result of its cooperation with the bank.