Tugende, a technology-enabled asset finance company that operates in the East African nations of Uganda and Kenya, has raised $3.6 million more led by venture capital firm Partech.
VC firm Enza Capital and regional angel investors also participated in the funding round, Tugende said.
The investment, which was agreed and structured in 2020, is an extension of its Series A round.
Last September, Tugende had announced the first close of a larger Series A round led by Toyota Tsusho’s Mobility 54. The latest funding takes the total capital raised in the round to $9.9 million.
Tugende, which was started in 2012, will use the fresh funding to fuel portfolio growth in Uganda and Kenya.
Led by Michael Wilkerson, Tugende has also raised more than $20 million in debt capital to grow its portfolio. Current debt partners include Partners Group Impact Investments, US International Development Finance Corporation, Symbiotics, Frankfurt School Financial Services, Agora, Yunus Social Business, Global Social Impact Fund and Oikocredit.
Based in Kampala, Uganda, Tugende uses asset finance, technology and a high-touch customer support model to help micro, small and medium enterprises (MSMEs) own income-generating assets. It serves more than 43,000 clients across Kenya and Uganda.
The startup’s core asset finance packages include medical and life insurance, training, safety equipment and digital credit profiles, besides low-cost asset financing for SMEs. In addition to its first product of motorcycle taxis, Tugende has broadened the assets it finances to boat engines, cars, refrigerators and other income-generating equipment. It is also currently piloting financing for e-mobility assets.
All payments are digital and Tugende provides proprietary credit scores automatically to all clients to help them monitor their performance and unlock discounts and new products.
It currently has over 500 full-time staff across 20 branches in Uganda and four in Kenya, of which six opened since January this year.
“Last year, in the middle of the pandemic, we decided to invest in Tugende. Tugende combines technology and strong operations to aid millions of professionals grow their businesses and drive economies forward,” said Tidjane Deme, partner, Partech.
San Francisco- and Paris-based Partech is a multi-stage venture capital firm. It also has investment teams in Kenya and Senegal. The firm backed as many as 82 startups in 2020 across 24 countries in Europe, America, Africa and Asia.
Mike Mompi, partner at early-stage investor Enza Capital, said the VC firm was attracted by Tugende’s application of technology, which incorporates a range of social considerations to build a new type of credit score, and which will increase access to capital across a range of African markets.
Enza was launched in 2019 with headquarters in Nairobi, Kenya. It has backed 13 African tech companies to date across Kenya, Uganda, Nigeria, Ghana, and South Africa.