Nigerian fintech startup Kudi has raised a US$5 million Series A funding round which it will use to grow its team, increase the size of its agent network, and launch new products.
Founded by Yinka Adewale and Pelumi Aboluwarin in 2016, Kudi enables underbanked and unbanked Nigerians to access basic financial services such as money transfers, bill payments and cash withdrawals through its agent network.
The startup has now secured a US$5 million Series A funding round led by Partech Partners, joined by Y Combinator chief executive officer (CEO) Michael Seibel, and featuring existing investors Khosla Ventures and Y Combinator. This takes Kudi’s total raised funding to US$6.7 million.
Kudi will leverage its Series A round to add to its team, grow its network of agents across Nigeria, and launch other financial services in partnership with banks and other fintechs. It already has an agent network comprising over 4,500 merchants, which processes over US$30 million in payments each month.
“We’re excited about the growth we’ve experienced over the last 12 months. We literally grew from processing US$1.1 million to US$30 million monthly with the same team. Going forward, we’ll be hiring engineers, product managers and product designers to ensure our product is 10X better than what’s on the market today even as we grow our network of agents,” said Adewale, the startup’s CEO.
Tidjane Dème, general partner at Partech and co-lead of the Partech Africa Fund, will join Kudi’s board. He said agent networks were the backbone of African digitisation as they offer an effective way of distributing digital services.
“We believe that Yinka and Pelumi have the right vision to build the best platform for agent networks. The Kudi team has built an excellent product that their agents love to use. As a result, Kudi has demonstrated an impressive growth since its inception,” he said.
Seibel said the chance to personally invest in Kudi was one he could not turn down.
“For an economy that largely depends on cash, the growth of digital payments in Nigeria will be accelerated by Kudi as they provide a gateway between cash and digital, and we think that’s a huge opportunity,” he said.