Ghanaian fintech startup Float has secured $17 million in a seed funding round led by institutional investors, as it moves to expand its product offerings and footprint in Africa.
This comes within a year of its launch as a fintech startup with operations in Ghana and Nigeria.
Float, a Ghana-based fintech startup founded by Jesse Ghansah and Barima Effah in 2020, is one of the many startups that are working tirelessly to offer innovative solutions to the cash-flow issues facing African small and medium businesses on a daily basis.
Since 2020, the startup, which provides flexible credit lines for small and medium enterprises to cover cash-flow gaps, has onboarded hundreds of businesses in a broad range of industries — retail and manufacturing, fintech, e-commerce, media and health.
It recently surpassed $10 million in credit spending and cash advances for businesses, driven by a 26-time increase in payment transactions, which include invoicing and vendor payments.
The round is a mix of a $7-million equity investment and a $10-million debt financing.
The debt financing was led by institutional investors Cauris Finance, while the equity financing was co-led by JAM Fund and Tiger Global, an investment firm focused on public and private companies in the global tech industry.
According to the company, the debt and equity injection will be used to improve the company’s cash management and launch new credit solutions targeted at specific business verticals and industries.
The management also noted that the funding will be used to deepen Float’s operations in its existing markets of Ghana and Nigeria as it prepares to set up active operations in Kenya and South Africa in Q2 2022.
Jesse Ghansah, the CEO and co-founder of Float, revealed that the company is on a mission to provide more cash flow and liquidity to millions of businesses on the continent. The recent funding that it received from investors will strategically position it to deliver on these promises.
“With this new funding, we will continue to refine both our credit and software products to deliver the best experiences for our fast-growing customer base. We are excited to be the growth partner of choice for businesses in Africa,” he said.
Angel investors that took part in the funding were Y Combinator’s CEO Michael Seibel, Sandy Kory of Horizon Partners, Ramp co-founders Karim Atiyeh and Eric Glyman, and Gregory Rockson of mPharma.
Nearly two weeks ago, mPharma secured $35 million in a Series-D funding round to expand its operations across existing and new markets.
Gregory Rockson, CEO and co-founder of Rockson, noted that the $35-million round will be used to scale up operations, as it plans to hire more engineers to grow its data infrastructure.