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Pezesha raises a pre-series A of $11m to grow its embedded finance platform

By Edlyn Cardoza

September 02, 2022

  • API
  • B2B Digital Lending Infrastructure
  • Embedded Finance
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Pezesha, FinTech, Embedded Finance, Women’s World Banking Capital Partners II, B2B Digital Lending Infrastructure, Working Capital, SMEs, MSMEs, API, Financial Services, Embedded Financing, KenyaPan-African embedded finance FinTech Pezesha has raised a pre-series A investment of $11 million. The round was a mix of $6 million equity and $5 million debt. The funding round, led by Women’s World Banking Capital Partners II (WWBCP II), will see the company significantly scale operations in its core markets and grow into new markets within Sub-Saharan Africa.

Pezesha offers a B2B digital lending infrastructure that provides affordable working capital to financially excluded SMEs in Sub-Saharan Africa. Pezesha will use the proceeds of this investment to grow its presence in East Africa and expand its digital lending infrastructure to the West African market.

Founded in 2017 by Hilda Moraa and headquartered in Kenya, Pezesha has been focused on solving complex infrastructure problems that exclude MSMEs in the “missing middle”. By bridging the MSME information gap and mending fragmented value chains, Pezesha has become a leader in Embedded Finance in Africa, offering productive credit to tech-enabled platforms such as Twiga Foods, Jumia and Marketforce, among dozens of others.

Partners integrate seamlessly with Pezesha’s APIs and offer credit, among other financial services, to their merchant network at the point of sale. Pezesha’s credit scoring APIs act as the engine of a simple but robust process where MSMEs receive real-time loan offers to purchase stock and pay later.

“We are excited about attracting institutional investors led by the Women’s World Banking Capital Partners II to harness our growth plans and push our mission to the next level. We are equally excited that WWBCP II intentionally invests in women, which allows us to cement inclusivity in our growth plans as a sustainable path towards our vision of building Africa’s MSME lending infrastructure,” said Hilda Moraa, CEO of Pezesha. “Additionally, this round has brought together strategic investors who underpin the fundamentals of financial inclusion in their thesis and we believe these combined experiences will help us accelerate and enable millions of MSMEs across African value chains to access affordable working capital.”

WWBCP II is the second gender-lens investment fund established by US-based non-profit organisation Women’s World Banking and managed by WWB Asset Management. The fund aims to close the gender gap by investing in high-performing financial service providers that serve low-income women with a dedicated technical assistance facility to help portfolio companies achieve strategic objectives toward gender inclusion. Other strategic investors who joined the round include Verdant Frontiers FinTech Fund (an early stage African FinTech Fund focused on accelerating financial inclusion), cFund and IOG, ventures investing in innovations layering blockchain infrastructure, Talanton (values-driven private impact investment fund) and Verdant Capital Specialist Funds investing debt in this round.

“We’re excited to join Pezesha’s journey,” said Christina “CJ” Juhasz, Chief Investment Officer, Women’s World Banking Asset Management. “Pezesha is dedicated to solving Africa’s working capital problem through its robust lending infrastructure and this investment will allow them to deepen the range of financial products offering especially to women owned MSMEs. We look forward to teaming up with Pezesha as it drives financial inclusion in Africa and continues to increase the number of women served in its business ecosystem.”

Pezesha is also opening up the debt liquidity market by working with strategic institutional investors such as IOG-Cardano. Through this partnership, the company can access affordable capital by layering DeFi liquidity channels on top of the scalable digital lending infrastructure.

Co-founder of IOG and Cardano, Charles Hoskinson, said, “I’m delighted to announce our investment in Pezesha. Facilitating the movement of capital into emerging markets to support economic growth and job creation is a core promise of blockchain and cryptocurrencies. Our vision is centered on using technology to make it easier for people across the globe to borrow and lend to each other in a regulated way. This investment in Pezesha is an important milestone, and we’re excited to be a part of their growth story.”

“Pezesha is democratising financial services to the underserved SMEs through its infrastructure that has validated trust, rockstar team and scale. We are allowing distribution models for our partners to grow with little acquisition costs while increasing retention and profitability. We are the tradeshift for Africa. Providing the rails for everyone to offer fintech services from supply chains, cooperatives, payments, e-commerce marketplaces etc by leveraging our lending infrastructure to operate and offer working capital to their customers in an effective and affordable way. In a nutshell, Pezesha has demonstrated the trust of all key stakeholders within its digital ecosystem and the capital markets”, said Moraa.

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