Ugandan fintech Asaak raises $30mn in pre-Series A Funding

Ugandan financial technology startup Asaak has successfully raised $30 million in pre-Series A equity and debt funding, attracting prominent investors such as Resolute Ventures, Social Capital, and HOF Capital. The company's Chief Executive Officer, Kaivan Sattarm, recently shared insights on the funding and the company's future plans in an exclusive interview with CNBC Africa. Asaak, founded in 2016, has witnessed significant growth with the recent funding round being a major milestone for the company. The funding is primarily aimed at accelerating product development and expanding geographic reach within Uganda and other parts of East Africa. Asaak plans to introduce new financial products such as motorcycle insurance and savings accounts alongside its existing asset financing offerings. One of the key products driving investor interest in Asaak is its asset financing for African SMEs, particularly focusing on the mobility sector. By providing motorcycle loans to motorbike taxi drivers, Asaak helps them transition from renting to ownership, reducing their financial burden and increasing their long-term earnings potential. The company's innovative approach to financial inclusion and empowerment has set it apart in the market. Kaivan Sattarm highlighted Asaak's unique business model, which leverages a Fintech platform to underwrite loans at a significantly faster pace compared to traditional lenders. With a remarkable turnaround time of just three days for motorcycle loans, Asaak can streamline its operations and offer additional financial products like fuel loans and personal loans. This efficiency has contributed to a high repayment rate of 95%, attracting both equity and debt investors. In terms of market scalability, Asaak is gearing up for expansion beyond Kampala, with plans to launch 68 branches in Uganda and initiate a lending pilot in Kenya. The company aims to tap into the robust demand for asset financing driven by factors such as unemployment and the entrepreneurial spirit prevalent in the region. By empowering individuals to become business owners and asset holders, Asaak is making a significant impact on the local economy. Looking ahead, Asaak is preparing for its Series A fundraising round, with strong interest from crowdfunding and institutional VC investors. The company has also forged strategic partnerships, including a collaboration with Standard Bank, Africa's largest bank. This partnership aims to leverage data generated from Asaak's motorcycle loans to develop innovative products such as motorcycle insurance using GPS driver data. With a clear vision for growth and financial inclusion, Asaak is poised to make a lasting impact in the East African market. The successful funding round and strategic partnerships signal a bright future for the company as it continues to drive economic empowerment and transformation in the region.