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Kuunda, a lending-as-a-service company, has closed a $5 million secondary share sale in which existing investors bought more shares. Entrepreneurs for Entrepreneurs Africa (E4EAfrica) led the round, with other existing shareholders.
Existing investors include Portugal Gateway Fund, Accion, Fondation Botnar, Seedstars Africa Ventures, and Dhow International Holding.
The company said the round was oversubscribed. It also said it received interest from investors outside its shareholder base, but existing backers took up the full amount.
“While we saw interest from investors outside our shareholder base, the round was taken up entirely by the investors who know Kuunda best,” said the company.
In a secondary sale, investors buy shares from each other rather than from the company. The company hasn’t revealed how this transaction impacts its funding. Kuunda mentioned that this deal allows investors to access cash before an IPO or acquisition.
“Venture investors often wait years for liquidity. This transaction shows that strong exits are possible before an IPO or acquisition, while we keep scaling responsible, profitable credit infrastructure across Africa.” said Kuunda.
Founded in 2018 by Andy Milne, Sam Brawerman, and Morne van der Westhuizen, Kuunda creates financing products that help agent networks, small businesses, and consumers access credit.
It uses its own credit scoring models based on real-time transaction data from partners. The financing options include e-float financing, airtime advances, working capital, stock financing, and overdrafts.
“Kuunda” means “to create” in Swahili. The company started its first product in Tanzania and uses a digital banking platform called 4Pay.
Its initial partner was M-Pesa Tanzania in 2019, followed by Airtel Africa in 2020, and then OneLoad Pakistan. In 2021, Kuunda established an operations hub in Nairobi, and in 2023, it launched in Malawi with Airtel and introduced a stock finance product in Pakistan.
In December 2021, Kuunda secured $2.25 million in seed funding from Accion Venture Labs. By September 2023, it had disbursed a total of $1 billion in loans.
