Fintech startups who are seeking to solve the low rate of financial inclusion in Africa seem to be finding it easier raising funds. South African fintech startup ProfitShare Partners has become the latest startup to raise up to a million dollar in funding. The startup has secured a ZAR25 million (US$1.7 million) capital line from the Vumela Fund to further address the lack of capital available to SMEs.
“We have unlocked an insatiable market for our offering and the commitment from the Vumela Fund is indeed encouraging to reach more SMEs and create an even greater impact in the market,” Andrew Maren, founder and chief executive officer (CEO) of ProfitShare Partners said.
Here Is The Deal
- The new funding came from the Vumela Fund, managed by Edge Growth Ventures, which has the mandate of supporting high-growth SMEs in the banking supply chain with good economic and impact returns.
- The funding from the Vumela Fund will help ProfitShare Partners in addressing funding gaps for SMEs, with the startup committed to offering immediate capital solutions to SMEs requiring cashflow to deliver on their contracts and purchase orders in the supply chain of large corporates.
Read also: Why More South African Startups Have Raised Funds This Year
Why The Vumela Fund Invested In ProfitShare Partners
According Mike Sage, trustee of the Vumela Fund, the investment into the startup came because of the confidence the Fund has that ProfitShare Partners would deliver on the mandate of the fund.
‘‘The results they have already shown will bring exceptional value to the objectives we wish to achieve — creating and supporting high-growth SMEs. The impact that we’ve seen is impressive and we look forward to accelerating this over the next two years,” he said.
According to Andrew Maren, he was excited to have secured the confidence of an established fund like Vumela to continue enabling the SME market through short-term capital solutions.
What ProfitShare Partners Does
ProfitShare Partners utilises technology to fast-track SME performance and delivery through its profit-sharing business model. As a short-term capital partner to small business owners, the fintech company also provides the professional expertise and guidance.
“We’ve managed to grow our book value 400 per cent in one year, highlighting the demand for this type of capital. Each successful deal raises the profile and profitability of our SME clients — ultimately, we want to grow small businesses to become financially sustainable and lose them to traditional financial institutions. That’s when we know we have truly helped our SMEs.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world