Visa Backs Fintech Startup Bloom In $6.5M Seed Round, One Year After Issuing Its First Card In Sudan
Bloom, a Sudanese fintech that provides a high-yield savings account and related digital banking services, has raised $6.5 million in a seed round. This funding follows the startup’s unannounced pre-seed round last year.
This round of funding included participation from Visa, Y Combinator, US-based VCs Global Founders Capital (GFC) and Goodwater Capital, as well as UAE-based early-stage business VentureSouq. Other investors include Dropbox co-founder Arash Ferdowsi, former N26 US CEO Nicolas Kopp, footballers Blaise Matuidi and Kieran Gibbs, and early employees at Revolut and Tide.
The Visa investment was one of the perks for Bloom’s participation in the worldwide card scheme’s Fintech Fast Track Program. As a result of the collaboration, Bloom, the first Sudanese business allowed to the programme, switched its cards from Mastercard to Visa.
Bloom’s founders say this seed round will help the Sudanese- and Dubai-based startup execute its expansion plan across the Anglo-East African region such as Ethiopia, Kenya, Rwanda, Tanzania and Zambia. A few competitors in the region include YC-backed Fingo, Koa and Finclusion.
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“The Visa investment is critical for companies like us for a couple of reasons. One, aligning with Visa as a partner gives you a bunch of benefits, launching products faster, marketing support and product support; and two, in addition to the investment, Visa Fintech Fast Track enables you to access these incentives in a streamlined way,” CEO Ahmed Ismail said.
Why The Investors Invested
The startup has acquired considerable traction since it was founded. In March of this year, the company announced that it was a part of Y Combinator’s winter batch, having emerged from stealth mode the previous month. In addition, Bloom’s waitlist was made public in March, and at the time, the company had more than 15,000 customers signed up. This number has already surpassed 100,000, Bloom founders claimed. They claim that the platform has been launched in Sudan, but they failed to disclose the number of active customers.
The investors were also attracted because of the backgrounds of the founders. CEO Ahmed Ismail is a former partner of Barclays investment bank. Youcef Oudjidane, Abdigani Diriye, and Khalid Keenan, his co-founders, all attended prestigious British colleges and worked for Goldman, Amazon, and IBM. Consequently, they have expertise in engineering, investment banking, and venture capital.
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“Visa is taking the lead as a first mover in digital payments in Sudan. We are committed to being a part of Sudan’s economic transformation by bringing our global expertise and capabilities to its government and private-sector partners. Together with Bloom, we will continue to drive acceptance of digital payments while finding opportunities to launch new products and services to Sudanese customers and merchants,” Ahmed Mohey, Visa country general manager for Sudan and Libya, said.
Roel Janssen, a partner at Global Founders Capital, shares similar sentiment about the team: “We are very excited by our investment in Bloom. Its experienced and talented founding team has the drive and expertise to build a product that is universally valued by consumers, partners and regulators in Sudan and the wider East Africa region.”
This investment and relationship, according to Bloom and Visa executives, will massively increase the use of Visa cards in Sudan and East Africa. In addition, Visa’s array of goods and services will enable users to make online payments in a secure and expedient manner. In April last year, Visa partnered with the United Capital Bank (UCB) to issue Sudan’s first local Visa card.
Bloom’s seed round is the largest in Sudan, a country with a passive digital ecosystem that just recently allowed foreign investment when Fawry backed fintech and e-commerce firm Alsoug following 30 years of international sanctions.
A Look At What The Startup Does
Bloom, which was founded in 2022 by Ahmed Ismail, Youcef Oudjidane, Khalid Keenan and Abdigani Diriye, provides fee-free accounts for consumers to save in dollars and buy and spend in Sudanese pounds. It also provides local and dollar cards, as well as a function that allows them to receive free remittances from numerous countries across the world, namely those where the majority of the Sudanese diaspora resides. The fintech collaborates with the Export Development Bank, a deposit-taking partner bank. Bloom earns money from the interest on these deposits, as well as the interchange and other auxiliary streams.
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“Our product is live in Sudan. The plan is to scale in the country and then expand to other markets,” Ismail stated. “We anticipate being in at least one market before the end of the year and a couple more early next year.”
East Africa as a region has 500 million inhabitants, with a median age of 18 and a rapidly expanding middle class. However, the region’s currencies, including the Sudanese pound, are volatile and depreciate by 15% to 20% per year on average. This volatility is one of the most significant hurdles to the middle class’s wealth protection and creation, which is why Ismail and his co-founders founded the fintech: to help Sudanese citizens hedge against the escalating devaluation.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh