The Nigerian mobility tech startup Metro Africa Xpress Inc. (MAX) plans to enter additional markets across Africa to formalize the continent’s transportation sector after securing $ 31 million in Series B funding.
The startup announced to TechCrunch that it will use the funding to enter Ghana and Egypt by the end of the first quarter of 2022 and other additional markets in Francophone, eastern and southern Africa by the end of the same year. The funds will also be used to provide vehicle finance loans to over 100,000 drivers over the next two years.
MAX started out in 2015 as a delivery startup with motorcycles to fulfill customer orders before moving into ride hailing and later into vehicle subscription and financing services – solutions that were created on the basis of data from its first services.
In 2018, the startup introduced vehicle financing, and in just over two years was CFO Guy-Bertrand Njoya TechCrunch said the churn rate of their associated drivers has crashed to “near zero”.
“We spent a lot of time understanding what the drivers were doing, and we realized that most of them don’t own the vehicles they are using,” said Njoya.
“It became clear that the fundamental problem for drivers is consistent access to vehicles. And then we realized that if we want to successfully solve the challenge of mobility across the continent, we first have to deal with the issue of vehicle access. “
MAX is currently developing and assembling its own line of electric motorcycles. Photo credit: MAX.
MAX’s commercial banking partners are now granting car loans to drivers using the mobility company’s data in their credit risk assessment.
As part of its catalog of services, MAX plans to build an electric vehicle infrastructure in its emerging markets with the intention of introducing electric vehicles to its emerging clientele.
“This is another milestone on our way to make mobility safe, affordable, accessible and sustainable through the use of powerful technologies and operators. The investment will enable us to transform the lives of hundreds of thousands of drivers across the continent, accelerate international expansion and continue our groundbreaking mobility initiatives, ”said MAX Co-Founder and CEO Adetayo Bamiduro. Chinedu Azodoh is the other co-founder of the startup.
Offering solutions to challenges related to mobility was part of the Center of MAX activities so the next puzzle it wanted to solve is how to increase drivers’ revenue by lowering their operating costs.
The founders quickly realized that the adoption of electric vehicles would be the natural next step, and in 2019 MAX embarked on their electric mobility journey. The company currently offers drivers two-, three- and four-wheeled electric vehicles through various leasing and financing options.
“It’s an additional option that we wanted to offer drivers because what is most important to them is getting a decent living from a higher income. For us, electric mobility will be a major driver of this goal, as electric vehicles are now cheaper than their gasoline equivalents, ”said Njoya.
MAX is currently developing and assembling its own line of electric motorcycles. Njoya said they are working with partners across the ecosystem including Yamaha, a leading motorcycle manufacturer, to deliver their electric vehicles.
“We are working with Yamaha on vehicle access for drivers and access to finance. As evidence of the success of our work and partnership, Yamaha today set up its own driver vehicle finance company for Africa, based on the work we have done with them over the years, ”said Njoya.
The latest round of funding, led by global private equity platform Lightrock, which made its first investment in the African mobility space. The international venture capital company Global Ventures, based in the United Arab Emirates, also took part in the round, as did the existing investors Novastar Ventures and Proparco, the French development finance institution, as part of their Digital Africa initiative.
Njoya said the startup is working to become the vehicle subscription and financial services platform for millions of transportation companies across the continent. They recently teamed up with the Estonian ride-hailing company Bolt in a lease-to-owner agreement that will allow 10,000 drivers to purchase energy-efficient vehicles as part of the platform in Nigeria.
