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SME banking fintech Prospa has raised US$3.8 million in the largest pre-seed round to have been raised by a Nigerian fintech startup, according to an announcement by the company.
The pre-seed round is the largest of its kind in Nigeria and sub-Saharan Africa, TechCrunch reported. Across the African continent, it is second only to Egyptian fintech startup Telda’s US$5 million pre-seed round raised in May this year.
The round was oversubscribed by 380%, and was raised from Global Founders Capital and Liquid 2 Ventures. Numerous angel investors also participated.
They included Mercury’s Immad Akhund, Ramp’s Karim Atiyeh, Teachable’s Ankur Nagpal, angel investment fund by Todd Goldberg and Rahul Vohra, and Square, Facebook and Nubank executives.
Funds will be used to bolster customer acquisition, scale Prospa’s product and engineering team, and develop its product suite.
Prospa offers a fintech product for “real people”
Prospa provides banking and financial services for African SMEs. The branchless banking solution comes with bank accounts that are enabled for transfers and bill payments. It also comes with business and financial management solutions, such as invoicing, inventory management, customer management, and even ecommerce.
The company was founded in 2019, and currently has thousands of users signed up for its monthly subscription service, it said.
Users are growing 35% month on month, and Prospa has so far processed 360,000 invoices and 20,000 unique inventory items on a monthly basis, the company added.
It was also part of Y Combinator’s winter batch last year.
Frederik Obasi
“We’re not building for categories, we’re not building X for Africa. We’re building a product for real people. These people are entrepreneurs, creators, freelancers and side hustlers,”
Frederik Obasi, Co-Founder and CEO of Prospa, said in the announcement.
“Building and scaling businesses ourselves, we know payments and traditional banking products are just a fraction of what entrepreneurs need to succeed, we’re building an operating system.”
