Churpy, a Kenyan fintech startup, has raised $1 million in seed funding to expand across Africa, with hubs in Nigeria, Egypt, and South Africa.
Unicorn Growth Capital led the seed round, which also included Antler East Africa (following on from a $100,000 pre-seed), the Nairobi business angel network, and some Rally Cap’s LPs, including senior executives from Stripe.
The startup stated that it intends to transform how businesses manage the debt owed to them by their customers through its Software as a service (SaaS) product, which automates the labor-intensive processes of reconciling incoming payments and invoices, which are still primarily manual for most local businesses.
Furthermore, the startup announced plans to launch a working capital financing product aimed at small and medium-sized businesses that will supply enterprise customers who have signed up for the startup’s SaaS product.
Kennedy Mukuna, Churpy co-founder, commented on the company’s plans to expand into other African countries, saying, “We are hiring more people as we plan to enter Egypt, Nigeria, and South Africa, which are the hubs into their (respective) regions.” We are also investing in product development as we plan to expand our offering.”
Makuna’s SME plan emphasizes that SMEs benefit from immediate payment for goods delivered to these businesses, rather than having to wait months for their money.
“SMEs have a huge financing gap,” he said. They are suppliers to these large corporations and require capital to continue transporting raw materials to their other clients. Typically, they require collateral to access bank loans and must wait for approval to access capital to keep their business running. We are ensuring that they are paid quickly after delivering goods to partner enterprises for a 0.5 percent origination fee. We are paid when their invoice matures.”
“It is clear that B2B payment operations are significantly under-penetrated and ripe for modernization and disruption globally,” said Barbara Iyayi, co-Founder and CEO of Unicorn Growth Capital. We are thrilled to be working with the Churpy team as the market’s first mover.
“Churpy is the only end-to-end platform available that offers accounts receivable automation, an invoice marketplace, and reconciliation with integrated B2B payments specific to its markets.” They are well-positioned to be a critical partner to African businesses and lenders, and can effectively address the significant credit gap that SMEs face for supplier finance and working capital.”