Insurance technology is fast turning out to be a new sub-domain within the fintech segment to attract investor attention in Africa. Botswana’s insurtech startup Alpha Direct has just raised $600,000 in a pre-Series A bridge funding as it nears a much larger funding round in about two months.
The investment round was oversubscribed 20% as against the original target of $500,000 and was led by Launch Africa Ventures with participation from Century Oak Capital and a few existing angel investors.
Founded around seven years ago by brothers Arun Iyer (CEO) and Arjun I (COO), Alpha Direct is based in the capital city Gaborone and offers direct insurance. Last September it incorporated a Singapore arm, likely to channel funding for the firm.
Alpha Direct reportedly made $4.8 million in revenues last financial year and is looking to expand in other markets with fresh funding. It is planning to expand into Zambia and South Africa to begin with.
The firm had previously raised a number of seed cheques cumulatively scooping up around $2.5 million to date. According to Iyer, it is aiming at a $5 million Series A round by June.
The brothers had previously floated an internet firm during the dotcom boom named Chatswana among other portals when they were students. Arun had also founded multi-location CPA practice firm Astutant and talent solutions firm InsourcePro with offices in US and India. He is also associated with a pipes firm Flo-Tek in Botswana.
After Chatswana, Arjun worked with a medical consulting firm and thereafter floated a HR consulting outfit Exelle before joining an automotive parts retailer before joining his bother in Alpha Direct. He also leads the wholly owned arm Risk AI, which is into building and licensing insurtech solutions for others. Its flagship platform Graphite leverages AI, machine learning and IoT to deliver customisable insurance solutions for complex markets.
Alpha Direct joins a string of insurtech startups in Africa that have recently raised funding. Others include Mali-Uganda based OKO that raised funding last week and previously Nairobi-based Pula raised $6 million in Series A funding and Curacel, an artificial intelligence-powered platform for insurance claims processing and fraud management in Africa, raised $450,000 in pre-seed funding.
Meanwhile, two South African legal-tech startups Legal Lens and BriefCo have come under a single umbrella and secured funding from local VC firm Imvelo Ventures.
Legal Lens was founded by Yusha Davidson while Catherine-Jane Paulse had started BriefCo last year. The two ventures are now part of Cycad Group, a new entity that has secured funding from the VC firm started by Capitec Bank and Empowerment Capital Investment Partners.
Legal Lens is a legal spend management company that leverages natural language processing and machine learning tools to regulate legal expenditure and reduce legal fees, while BriefCo is a legal cost consultancy that leverages technology to deliver and store relevant documents.