Nigerian mobility tech company, Metro Africa Xpress Inc. (MAX) has raised $31 million in a Series B investment round to expand into other African markets as it works to formalize the continent’s transportation sector.
The recent round of funding was headed by Lightrock, a global private equity firm that is making its first investment in the African mobility industry.
Global Ventures, a UAE-based international venture capital firm, as well as current investors Novastar Ventures and Proparco, a French development financing agency, participated in the round through their Digital Africa project.
MAX plans to utilize the funds to expand into Ghana and Egypt by the end of the first quarter of 2022. It also intends to enter Francophone countries as well as East and Southern African countries by the end of the year.
In the following two years, the money will also be utilized to give car finance credit to approximately 100,000 drivers.
Founded in 2015 by Adetayo Bamiduro and Chinedu Azodoh, MAX started out as a delivery service that uses motorbikes to fulfill client orders before moving into ride-hailing.
It then expanded into automobile subscription and finance services, which it devised using data from its previous offerings.
According to the startup, it introduced vehicle financing in 2018, and in just over two years, the churn rate by drivers affiliated with them has crashed to “close to zero.”
“We spent time understanding drivers’ operations, and it became apparent to us that most of them don’t own the vehicles they use. It has become clear that the fundamental issue that drivers face is consistent access to vehicles. And that is when we realized that if we are to be successful at solving the challenge of mobility across the continent, we have to first address the issue of vehicle access. ”Guy-Bertrand Njoya, CFO at Max.
MAX’s commercial bank partners are now extending car purchase loans to drivers based on the mobility provider’s credit risk assessment data.
According to the company, it intends to establish electric car infrastructure in its new markets as part of its service offering, with the goal of providing EVs to its growing clientele.
MAX’s operations have been centered on finding answers to mobility difficulties, so the next problem it needed to solve was increasing driver earnings while lowering their operational expenses.
The creators rapidly understood that adding electric vehicles was the logical next step, and MAX began its electric mobility journey in 2019.
Currently, the company provides two-, three-, and four-wheeler electric vehicles to drivers via a variety of leasing and financing options.
This startup presently manufactures and designs its own electric bikes. To provide its EVs, the company says it collaborates with partners throughout the ecosystem, including Yamaha, a prominent motorcycle maker.
Speaking on the funding, MAX co-founder and CEO Adetayo Bamiduro believes this financing is the next step in making its dream of deploying high-performance vehicles to its customers a reality.
“It is another milestone in our journey to make mobility safe, affordable, accessible, and sustainable by deploying high-performance 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 pioneering initiatives in the mobility space, ”MAX co-founder and CEO, Adetayo Bamiduro.
The company says it is aiming to become the preferred vehicle subscription and financial services platform for millions of transport operators across Africa.
It recently formed a lease-to-own agreement with Bolt, an Estonian ride-hailing business, to enable 10,000 drivers on the platform in Nigeria to get fuel-efficient automobiles.