Africa is experiencing a surge in demand for cars and commercial vehicles, driven by factors such as rising disposable income, middle-class growth, and rapid urbanization. However, the continent’s car ownership is relatively low compared to the global average. In light of this, Shekel Mobility, a YC-backed B2B auto dealers marketplace, has recently raised over $7 million in funding, signaling a promising future for the automotive industry in Africa.
Seizing the Opportunity: Unlike startups targeting consumers and drivers, Shekel Mobility focuses on a different aspect of the automotive ecosystem – providing tailored services for dealers. Small car dealers play a crucial role, and affordable vehicle financing is key to their daily operations, cost management, and ultimately, customer satisfaction. Shekel Mobility recognizes this need and aims to bridge the gap by offering affordable financing and business solutions to empower car dealers across Africa.
Funding Breakdown and Strategic Partnerships: Shekel Mobility’s latest funding round comprises $3.2 million in equity and over $4 million in debt, with Ventures Platform and MaC Venture Capital leading the way. This follows a successful pre-seed investment in January, which showcased confidence from investors like Y Combinator, Voltron Capital, and Zedcrest. Notably, strategic partnerships with Zedvance, VFD Microfinance Bank, Zenith Bank, and Fluna have further strengthened Shekel Mobility’s position, with these institutions leveraging the platform to finance auto dealerships.
Driving Growth: The Shekel Credit Advantage At the core of Shekel Mobility’s success is its flagship product, Shekel Credit. This innovative financing solution provides auto dealers with immediate access to credit limits of up to $200,000 for vehicle purchases. The financing model, involving a 30% contribution from the dealer and a 70% loan from Shekel Mobility, has proven effective in facilitating transactions, with a zero percent default rate.
Expanding Horizons: Shekel Business Building on its success, Shekel Mobility is set to introduce Shekel Business, a suite of tools designed to digitize informal trading processes within the auto dealership vertical. This new offering aims to assist dealers not only in financing their inventories but also in streamlining sales and structuring processes. With a focus on reducing the overall cost of owning car dealerships, Shekel Mobility is poised to drive further innovation and efficiency in the industry.
The Vision: Transforming Africa’s Automotive Industry Shekel Mobility’s founders, Benjamen Oladokun and Sanmi Olukanmi, envision their platform as the premier ecosystem for launching and growing car dealerships in Africa. With a goal to facilitate transactions amounting to $10 billion annually by 2025, the startup has already powered transactions worth over $56 million, supporting the growth of more than 1,400 auto dealers across 7,000 cars.
Investor Perspectives: Ventures Platform and MaC Venture Capital, among other investors, recognize Shekel Mobility’s potential to revolutionize the automotive industry in Africa. Kola Aina of Ventures Platform highlights the startup’s market-creating innovation, crucial for expanding Nigeria and Africa’s automotive sector. Marlon Nichols of MaC Venture Capital emphasizes the transformative impact Shekel Mobility can have, not only in financing small businesses but also in providing affordable automobiles to the local market.
Conclusion: As Shekel Mobility secures substantial funding and expands its suite of offerings, the startup is poised to play a pivotal role in transforming the African automotive industry. By empowering small car dealers with affordable financing and innovative tools, Shekel Mobility is not just facilitating transactions; it’s driving a positive impact on businesses and consumers alike. The road ahead looks promising as Shekel Mobility accelerates its mission to revolutionize the way cars are bought, sold, and financed in Africa.
