Moove, an African mobile fintech that provides vehicle financing to drivers on ride-hailing and delivery apps, has raised $100 million in a funding round as it plans to expand into new markets.
Moove did not disclose who was the lead investor in the round, but people familiar with the matter confirmed to TechCrunch that Uber led the Series B round, making it the company’s first investment on the African continent.
The round, which also included sovereign wealth fund Mubadala and several other investors, pushed Moove’s post-money valuation to $750 million. That’s up from the $550 million it raised last August in an equity and debt financing led by Mubadala. The news confirms a Bloomberg report last month. Dubai-based The Late Ventures, AfricInvest, Palm Drive Capital, Triatlum Advisors and Future Africa also participated in the round.
To date, the company has raised $250 million in equity (and $210 million in debt).
Financing is crucial as Moove prepares to expand into new markets. The company operates in 13 cities in six markets including Nigeria, South Africa, Ghana, the United Kingdom, India and the United Arab Emirates. Moove said it plans to use the new funding to expand its revenue-based auto financing platform to 16 markets by the end of 2025.
Moove takes a two-pronged approach to vehicle financing. The four-year-old mobile fintech company buys fleets of vehicles and then sells them to drivers through its platform. Its software provides financing to drivers through a credit scoring system, allowing them to purchase new cars for ride-hailing, logistics and delivery. The vehicles offered to Moove customers vary from conventional vehicles such as Toyota and Suzuki to electric vehicles (EVs) such as Tesla.
A percentage of the driver’s weekly earnings is deducted and applied toward vehicle payments.
Why Uber Funds Moove
Uber operates in numerous cities in eight African countries: South Africa, Nigeria, Ghana, Egypt, Kenya, Tanzania, Uganda and Ivory Coast. Its services are mainly provided in major urban centers, where demand for ride-hailing services is considerable. In 2022, Uber completed 1 billion rides in these markets.
Still, the company has encountered challenges from regulators in some of those markets. The disputes involve issues such as commissions, licenses and taxes. In addition, Uber also faces competition in these regions from competitors such as Bolt and inDriver. This is where Moove comes into play.
Uber’s decision to back Moove, its first investment in an African startup, signals a concerted effort by the company to ensure a steady supply of drivers for its ride-hailing platform (Uber is Moove’s largest car financing and vehicle supply partner; Moove also has partners) with other gig networks including SWVL and Kobo). Delano viewed the investment as validation of Moove’s business model and emphasized its role in strengthening the strategic relationship between the two parties.
Additionally, Uber’s investments in Moove and other fleet management startups such as India’s Everest Fleet are in line with the company’s commitment to a fully zero-emission fleet by 2040. Electric vehicles have become an important part of Moove’s business strategy since the expansion to expand beyond Africa in 2021. The car financing startup operates large electric fleets in the UAE and the UK. The company is currently testing a product line in India and plans to launch more than 20,000 electric vehicles on Uber.
Moove said in a statement that a large part of its new market expansion will focus on electric vehicles, “which will lay the foundation for a more sustainable and convenient mobility ecosystem for customers around the world.” However, customers in Africa may You will experience delays in participation.
Moove was initially optimistic about expanding its EV lineup in Africa. In a 2021 interview, co-chief executive Ladi Delano outlined a strategy: Moove would buy new electric vehicles at a discount and sell them at lower prices in the region. Potential challenges such as poor road conditions and a lack of charging infrastructure needed to expand in Africa could affect Moove’s initial plans. So the startup is considering another approach: natural gas vehicles.
“We want to be at the forefront of electrification in the UK and UAE by putting more electric vehicles on the road. But in a country like Nigeria we want to be at the forefront of everything from ICE (internal combustion engine) engines to compressed natural gas (CNG) vehicles , and then from CNG to the forefront of the transition to electric vehicles,” the co-CEO said on a TechCrunch conference call. “We are currently doing a lot of work to prepare for the transition to CNG in the Nigerian market, which we hope will reduce the impact of rising fuel prices on our customers’ bottom lines.”
driver challenge
Moove motorists in Nigeria have encountered various challenges over the past year, including a significant increase in fuel prices amid an inflation rate of over 30%. Additionally, exchange rate fluctuations impact vehicle maintenance costs in a country that relies heavily on imports. Although drivers join Moove in search of a source of income, macroeconomic conditions have placed significant pressure on them, leading some to protest that working arrangements with car financing platforms (especially weekly remittances to the platform) add more stress than they alleviate.
Delano explained that Moove’s tries to tailor its products to address these challenges while maintaining profitability. He highlighted a number of initiatives implemented over the past year to support drivers, such as the Moove Care programme. The measures include a 33% reduction in weekly remittances, a fuel subsidy scheme during periods of rising prices and the introduction of flexible payment options. For example, customers now have the flexibility to extend repayment terms from 48 months to 50 to 60 months, ensuring the overall weekly cost remains affordable, he said.
As Delano revealed during the call, Nigeria, in addition to being an unprofitable market, is no longer Moove’s largest market in terms of customer numbers. When asked about the possibility of Moove exiting Nigeria due to ongoing macroeconomic challenges affecting its profitability, Delano said such a move was unlikely. He attributes this stance to the mission of the company he founded with co-founder Jide Odunsi: to provide vehicle financing and create jobs and income for drivers in the country and across Africa.
“When we started the business, Nigeria had positive unit economics, but due to a number of macroeconomic factors, those positive unit economics have clearly changed,” the CEO said. “But we can see and believe that there will be a clear roadmap for this market to return to positive unit economics in the near future, despite the support we are providing to our customers and the shocks we are experiencing on a daily basis.”
Moove’s growth strategy
Moove leverages geographic and market category diversification to drive its expansion while mitigating risk. Moove not only operates in multiple countries, but is also marketing to ride-hailing, logistics, public transportation and instant delivery platforms. It also appears to be turning to Uber’s rivals.
TechCrunch has learned from multiple sources that Moove recently signed a deal with Bolt, Uber’s main rival in emerging markets, to expand its options for ride-hailing services in its most important category. The specific details of the partnership and its implementation remain unclear, especially given Moove’s existing arrangement with Uber.
Delano did not comment, but he did say that Moove has formed many partnerships in various markets around the world to provide customers with more options. However, he added that implementing these partnerships will take time.
This latest funding comes after a year of significant growth for Moove, which is also backed by New York-based Left Lane Capital and European VC Speedinvest. Last August, the mobile fintech company had 15,000 customers and completed more than 22 million trips. It now provides more than 30 million trips to more than 20,000 customers in six markets.
Moove’s annual recurring revenue also increased from $90 million to $115 million during this period; the company said it will become profitable in the upcoming fiscal year.
Following the deal, Moove moved its headquarters to the UAE, driven by its partnership with Mubadala. The UAE is significant for Moove as it launched a fully integrated charging solution there and set a record for the most electric rides on the Uber platform in 2023. Delano revealed plans to increase investment in the UAE and other markets in Africa, Europe and Asia while expanding into Southeast Asia and Latin America in the coming months.
“We believe in the potential of the African market and our business in it, so we will continue to invest accordingly,” he said. “However, profitability on these investments is critical. Additionally, we will continue to evaluate global opportunities and expand into markets where we believe there is a clear path to profitability or positive unit economics.”
