Nigeria’s smart fintech, Shekel Mobility for auto dealerships has secured $7 million in funding, comprising $3.2 million in equity and over $4 million in debt pre-seed funding to fuel its ambitious goal of becoming the largest auto dealership ecosystem in Africa.
Shekels mission is to build simpler and smarter solutions for Auto Dealerships in Africa. The company also intends to establish the most extensive auto dealership ecosystem. The dealership is expected to drive a total value of $10 billion by the year 2025.
The funding round was led by Ventures Platform, with participation from Y Combinator, Voltron Capital, Zedcrest, and other angel investors. This significant investment underscores the confidence of industry experts in Shekel Mobility’s transformative potential for the African auto industry.
The funding round, gives Shekel Mobility a clear path to accelerate its growth trajectory as it gears up to introduce innovative solutions in the coming months.
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How Nigeria’s Shekel work’s
The founders explain that this new product aims to digitalize informal trading procedures within the auto dealership sector. This set of tools is tailored to aid dealers. Although, not just in financing their stocks but also in optimizing sales and organizational procedures.
Talking about the funding, the core of the startup’s growth centres around its primary offering, Shekel Credit. This service provides immediate financing to auto dealers, granting credit limits of up to $200,000 for buying vehicles. They usually ranging between $5,000 to $20,000.
In this financing process, the dealer contributes 30% of the total cost, like $3,000 for a $10,000 car. Shekel covers the remaining 70% as a loan to the dealer. After selling the vehicle to the end customer, usually within three months, the dealer pays Shekel back, covering the loan interest and transaction fees linked with the car sale.
The World Economic Forum reveals Africa’s escalating demand for 2.4 million cars and 300,000 commercial vehicles yearly. These is due to increasing disposable income, a burgeoning middle class, and rapid urbanization.
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Nigeria’s Shekel Initiatives
The funds will improve Shekel Mobility’s current Annual Recurring Revenue (ARR). These will be slightly over $2 million to four times its size. While leveraging this financial injection, Shekel Mobility prepares for its upcoming priced round, building on the momentum gained from this significant funding round.
However, despite this demand, Africa’s car ownership stands at less than 45 cars per 1000 people, a stark contrast to the global average of 203. In response, emerging startups like Autochek and Moove have addressed consumer and driver needs. Likewise, there is a growing necessity for solutions tailored to vehicle sellers in Africa, where Shekel Mobility comes in.
Nigeria’s Shekel Mobility has leveraged its progress over the past 20 months with its credit product. The company still aims to launch additional services, such as Shekel Business.