Klump, a Lagos-based Buy Now Pay Later payment platform, announced the completion of its $780k pre-seed round, providing the company with sufficient capital to launch its flagship Pay with KlumpTM product with select partners, providing BNPL solutions to customers and companies.
“Our BNPL offering is a natural next step in the development of the African e-commerce sector, and we intend to be at the forefront by developing the capability to make credit decisions on customers in real-time and offer flexible payments to help reduce the economic pressure of one-time payment which has grown astronomically since the emergence of COVID-19. At the same time, we want to help merchants achieve commercial prosperity by providing the tools to offer their customers the option to pay in small instalments,” Celestine Omin, CEO, Klump, said.
Seedcamp, a London-based investment firm that has previously invested in UiPath, Wise, and Revolut, led the round, which also included participation from MAGIC Fund, Voltron Capital, Yellowwood, Kickoff Africa, Hoaq Capital, Kesho VC, and Assembly Investors. Numerous angel investors and founders participated in the round, including Olugbenga “GB” Agboola, CEO of Flutterwave, Will Neale, Founder of Grabyo, Michael Pennington, Founder of Gumtree, Helium Health Founders, Richmond Bassey, CEO of Bamboo, Babs Ogundeyi, CEO of Kuda Bank, Abdul Hassan, CEO of Mono, Opeyemi Awoyemi, and Selma Ribic.
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This cash injection will be used to further improve Klump’s credit decision and checkout engines, to expand the company’s team, to establish merchant relationships, and to provide inexpensive financing to its consumers.
“We’re thrilled to be backing Celestine and Olufunbi as they lay the backbone in democratising new payment methods across a hugely under-served African market. It was clear to us from our first meeting that their respective experiences scaling some of Africa’s largest startup successes and implementing best-in-class payment solutions for large e-commerce merchants makes them the perfect team to become the responsible BNPL category leader on the continent,” Felix Martinez, an investor at Seedcamp, said.
A Look At What The Startup Does
Klump, founded in 2021 by Celestine Omin and Olufunbi Falayi, who have combined experience building products at Konga, DealDay, Paystack, Andela, Amazon, and H-E-B, is launching their end-to-end BNPL product in partnership with WhoGoHost and Gigalayer, Nigeria’s largest domain, hosting, and cloud service providers.
Klump enables clients to purchase and receive their items immediately, or to pay in four (4) equal instalments. The initial payment is made at the time of checkout, and the remaining balance can be stretched out over three (3) months at a low interest rate. Klump makes full payment to merchants within one business day.
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As the adoption of BNPL continues to grow globally, Klump’s vision is to become the preferred alternative online checkout and in-store payment processing company, offering flexible payment solutions to customers and merchants for products and services. With their proprietary credit eligibility and fraud detection engine, Klump is able to make an informed credit decision on a customer in less than 3 minutes, compared to the industry norm in Nigeria, which stands at two to three days, with a goal to further reduce the decision time to less than a minute.
Klump has also worked with AltSchool, an alternative technology academic institution, to finance laptops for its students, as well as Betastore, a business-to-business retail platform, to finance goods for its retail customers. Klump will announce additional large-scale agreements in the coming weeks, initially focusing on marketplaces with higher-margin, discretionary-spending categories such as clothes and footwear, fitness, accessories, and beauty. Klump will also pursue verticals in education, travel, and healthcare.
“With our end-to-end BNPL product, we can quickly make a sound credit eligibility decision, facilitate transactions to approved customers, make disbursements to merchants, and effectively drive collections from customers with a flexible and efficient collections system. We are keeping mechanisms in place to ensure we promote responsible lending and reduce the risk of customers taking loans they cannot pay back,” Olufunbi Falayi, Co-founder and Chief Product Officer of Klump, said.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer