M-Kopa - Afrikan Heroes

Kenya-based M-KOPA Secures $250M+ Funding to Fuel Expansion of Asset Financing Platform

May 16, 2023

M-KOPA, a leading asset financing platform in Africa, has secured over $250 million in new funding to support its expansion and operations. This funding includes $55 million in equity and over $200 million in debt financing. The significant capital injection highlights the company’s strong performance and solid fundamentals. With this latest funding round, M-KOPA has raised a total of $245 million in equity funding since its establishment in 2011. Japanese-based trading house Sumitomo Corporation led the growth equity capital, contributing $36.5 million. Other investors, including Blue Haven Initiative, Lightrock, Broadscale Group, and Latitude, also participated in the equity round.

Why The Investors Invested

Sumitomo Corporation and other investors chose to invest in M-KOPA due to their shared vision and confidence in the company’s potential. Sumitomo, known for its infrastructural deals in Africa, believes in the continent’s progress through technology-enabled financial and digital services. They see M-KOPA as a valuable partner in achieving this vision. Additionally, M-KOPA’s innovative business model and track record of empowering underbanked customers resonated with the investors. The investors recognize the importance of M-KOPA’s mission to bridge the gender gap in financial inclusion and provide access to life-enhancing products and services for women in sub-Saharan Africa.

A Look at What M-KOPA Does

Founded in 2011 by Nick Hughes, Chad Larson, Jesse Moore, M-KOPA operates as an asset financing platform that enables underbanked customers in Africa to access “productive assets” through digital micropayments. The company offers financing for products such as smartphones, solar power systems, loans, and health insurance. Its flexible credit model allows customers to make a small deposit and repay their purchases through micro-installments, helping them establish credit histories over time. M-KOPA operates in Kenya, Uganda, Ghana, and Nigeria, and its customer base currently stands at three million.

The company’s focus extends beyond financial services, as it aims to reduce greenhouse gas emissions in Kenya and Uganda by promoting the use of solar products. M-KOPA has already sold over a million solar home systems, leading to a reduction of 2 million tonnes of carbon dioxide emissions. In line with its commitment to gender equality, M-KOPA strives to close the gender gap in its consumer base. While currently, around 40% of its customers are women, the company aims to exceed 60% representation.

Looking ahead, M-KOPA plans to expand into the South African market and explore opportunities in electric mobility. It intends to pilot operations in South Africa and test electric motorcycles in Nairobi. The company believes that financing options will play a vital role in driving the adoption of electric motorbikes in the future. Through its innovative approach to asset financing and its dedication to financial inclusion and sustainability, M-KOPA aims to make a lasting impact on economic progress and empower underbanked individuals across Africa.

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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

ex-US Vice President’s Fund Invests In Kenyan Asset Finance Company M-Kopa

August 31, 2022

Through a debt swap agreement, four foreign firms, including one co-owned by former US Vice President Al Gore and the British government investing arm, CDC, have acquired an estimated 40% stake in the asset finance fintech company M-Kopa.

CDC, LGT Lightrock, and Mr. Gore, who co-founded Generation Investment Management, will receive a combined 36.04 percent stake for converting their loans in M-Kopa into shares, according to people familiar with the deal. LGT Lightrock is a private equity fund backed by the Liechtenstein royal family.

The firm now has over 40 shareholders, including GIM CSF II (Cayman), Adolf H Lundin Charitable Foundation, Gray Ghost Doen Social Ventures Cooperatief Ua, Sumitomo Corporation, and Erick Donasian. LR Africa Holdings Limited will purchase less than a five percent interest in the business.

Several billion shillings have been raised by M-Kopa for expansion, including $75 million (Sh8.5 billion) in March of this year. A portion of the money was offered by three of the four international funds.

M-KOPA asset finance — *M-KOPA Solar CEO and Co-Founder Jesse Moore. Source: M-KOPA*

The M-Kopa acquisition has been authorised by the Competition Authority of Kenya (CAK), as the company aims to expand beyond asset finance to include health insurance, cash loans, and buy-now-pay-later merchant relationships.

“The proposed transaction involves the conversion into equity of certain convertible loan notes (debt) issued by the target to the acquirers and the amendment and recapitalisation of the target share capital. This will result in change of control in the target,” the CAK said.

In order to grow its asset financing business, which lets consumers pay for green energy items in instalments, M-Kopa has received Sh22.8 billion ($190 million) from investors over the years in over 16 rounds.

M-Kopa began selling solar-powered electrical devices in 2011. Additionally, it has worked with businesses like Safaricom to offer Internet-enabled mobile phones under the “lipa mdogo mdogo” idea, as well as Roam and Arc Ride, two electric mobility firms, to provide two- and three-wheeled electric scooters and cycles with flexible financing options.

Kenya’s rural areas are seeing an increase in the number of off-grid solar power start-ups selling pay-as-you-go kits in an effort to win over clients who lack consistent access to energy.

In addition to Solar Panda, D.Light, Greenlight Planet, Aspira, Bboxx, Azuri, Biolite, Daima Energy, Delta Energy Systems Ltd, Kensen, Mobisol, PowerGen, Solargen, Sunking, Suntech, ZilanSolar, Thrivesolar, Ofgen, Strauss Energy, and ORB Energy, PAYGO asset financing firms are also competitors of M-Kopa.

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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

Kenya’s M-Kopa Raises $75M To Drive Its Expansion Into Ghana and Nigeria

March 2, 2022

M-Kopa, a marketplace for financing solar household systems in East Africa (Kenya and Uganda), said on March 1 that it had raised $75 million. The funding will allow it to service two additional West African markets, Ghana and Nigeria. In 18 months, the business claims these two countries have sold 500,000 smartphones. Nearly 50% of all solar systems sold in 10 years.

Mayur Patel, Commercial Director of M-Kopa.

This round included previous investors such as the CDC Group and LGT Lightrock, as well as LocalGlobe’s Latitude Fund and HEPCO Capital Management. The growth equity deal was led by Generation Investment Management and Broadscale Group.

“As we move into our new markets, we start with one product which is our smartphone financing. We obviously have a broader product portfolio in our more mature markets,” said Mayur Patel, Commercial Director of M-Kopa.

This fundraising comes a year after the company asked the Dutch Development Bank (FMO) for $3 million in funding to help it grow and extend its product and service offerings.

With this latest investment, the company has raised about $190 million in its 12 years of operation. It claims to have released more than $600 million in finance for its 2 million underbanked customers across its African markets, led by Jesse Moore (pictured).

The company, which redirected its efforts during the pandemic by focusing on smartphone finance, wants to build more flexible financial products for its consumers over the next several years while also improving its technology.

M-KOPA Ghana Nigeria M-KOPA Ghana Nigeria

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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