Movementan African mobility fintech that offers vehicle financing to ride-hailing and delivery app drivers, has raised $100 million in a funding round as it plans to expand into new markets.
Moove did not say who is leading the round, but sources close to the deal confirmed to TechCrunch that Uber led the Series B round, making it the company’s first investment on the African continent. Update: After we published this article, Moove confirmed Uber’s investment in a Post on LinkedIn.
The round also includes sovereign wealth fund Mubadala and several other investors, pushing Moove’s post-money valuation to $750 million. That’s up from $550 million secured last August in an equity and loan round led by Mubadala. The news confirms a Bloomberg report since last month. Latest Ventures, AfricInvest, Palm Drive Capital, Triatlum Advisors and Dubai-based Future Africa also participated in the funding round.
The company has raised $250 million in equity (and $210 million in debt) to date.
The funding is critical for Moove as it prepares to push into new markets. The company operates in 13 cities across six markets, including Nigeria, South Africa, Ghana, the UK, India and the UAE. Moove says it plans to use the new capital to expand its revenue-based vehicle financing platform to 16 markets by the end of 2025.
Moove takes a two-pronged approach to vehicle financing. The four-year-old mobility fintech buys fleets of vehicles, which it then sells to drivers through the platform. Its software offers financing to drivers through a credit rating system, allowing drivers to purchase new vehicles for driving, logistics and deliveries. The vehicles provided to Moove customers range from traditional options like Toyotas and Suzukis to electric vehicles (EVs) like Teslas.
A percentage of the drivers weekly income is deducted and put towards vehicle payments.
Why Uber Funded Moove
Uber operates in multiple cities in eight African countries: South Africa, Nigeria, Ghana, Egypt, Kenya, Tanzania, Uganda and Ivory Coast. Its services are mainly available in large urban centers where there is a significant demand for horse riding services. In 2022, Uber completed 1 billion rides in these markets.
However, the company has faced challenges with regulators in some of these markets. These disputes involved issues such as procurement, licensing and taxation. Additionally, Uber has faced competition from competitors such as Bolt and inDriver in these areas. That’s where Moove comes in.
Uber’s decision to back Moove, marking its first investment in an African-founded startup, suggests a concerted effort to ensure a steady supply of drivers for its ride-hailing platform (Uber is its largest vehicle financing and supply partner Moove (Moove also has partnerships with other concert networks, including SWVL and Kobo). Delano sees the investment as a validation of Moove’s business model and emphasizes its role in strengthening the strategic relationship between the two parties.
Also, Uber’s investment in Moove and other fleet management startups like India’s Everest Fleet aligns with the company’s commitment to a fully zero-emissions fleet by 2040. EVs, in turn, have become a big part of Moove’s business strategy since its expansion beyond Africa in 2021. The vehicle finance startup operates large EV fleets in the UAE and the U.K. It is currently testing a range of products in India, with plans to introduce more than 20,000 EVs to Uber.
In a statement, Moove said a significant part of its expansion into new markets will focus on electric vehicles, “laying the foundation for a more sustainable and accessible mobility ecosystem for its customers worldwide.” However, customers in Africa may experience delays in participation.
Moove was initially optimistic about expanding its EV product line in Africa. In a 2021 interview, co-CEO Ladi Delano outlined a strategy: Moove would buy new discounted EVs and sell them at lower prices in the region. Potential challenges such as poor road conditions and a lack of charging infrastructure needed to scale across Africa could dampen Moove’s initial plan. Consequently, the startup is considering an alternative approach: natural gas vehicles.
“We want to be at the forefront of electrification in the UK and UAE, putting more EVs on the road. But in countries like Nigeria, we hope to be at the forefront of the transition from ICE (internal combustion) engines to compressed natural gas (CNG) vehicles and then from CNG to EVs,” the co-CEO said in a chat with TechCrunch. . “We are doing a lot of work right now to prepare the Nigerian market for the CNG transition in the hope that it will reduce the impact of the rising fuel price on our customers’ bottom lines.”
Driver Challenges
Over the past year, Moove drivers in Nigeria have faced several challenges, including significant increases in fuel prices amid over 30% inflation. Also, exchange rate fluctuations have affected the cost of vehicle repairs in a country heavily dependent on imports. Although drivers join Moove to find a source of income, these macroeconomic conditions have put significant pressure on them, leading some to complain that the working arrangements with the vehicle financing platform (especially in terms of the weekly remittance to the platform) add more anxiety rather than relief.
Delano explained that Moove’s has tried to adapt its products to address these challenges while maintaining profitability. He highlighted several initiatives, such as the Moove Care programs, implemented over the past year to support drivers. These initiatives include reducing weekly remittances by 33%, offering fuel subsidy schemes during price hikes and introducing flexible payment options. For example, customers now have the flexibility to extend their repayment period from 48 months to 50 to 60 months, ensuring the total cost remains affordable on a weekly basis, he said.
Nigeria, apart from being an unprofitable market, is no longer Moove’s biggest market because of its customers, Delano revealed during the call. When asked about the possibility of Moove exiting Nigeria due to the ongoing macroeconomic challenges affecting its profitability, Delano said such a move was unlikely. He attributed this attitude to the mission behind founding the company with co-founder Jide Odunsi: to provide access to vehicle financing and create employment and income opportunities for drivers in the country and across Africa.
“When we started the business, Nigeria had positive financials, but due to several macroeconomic factors, these positive unit financials have obviously changed,” the CEO observed. “But we can see and believe in a clear roadmap back to positive market economics in this market in the not-too-distant future, despite the support we provide to our customers and the shocks we experience every day.”
Moove’s growth strategy
Moove has used diversification—by geography and market categories—to fuel its expansion while mitigating risk. Not only is Moove located in several countries, but the company also markets ride-hailing, logistics, mass transit and drop-shipping platforms. And it appears to be targeting Uber’s competitors as well.
TechCrunch has gathered from multiple sources that Moove recently signed a deal with Bolt, a major rival to Uber in emerging markets, to expand options in ride-hailing, its most important category. The specifics of this partnership and its implementation remain unclear, especially given Moove’s existing agreement with Uber.
Delano declined to comment, but said Moove has secured numerous partnerships with various markets worldwide to provide customers with more options. However, making these partnerships work takes time, he added.
This latest funding comes after a year of significant growth for Moove, which is also backed by New York-based Left Lane Capital and European VC Speedinvest. Last August, the mobility fintech had 15,000 customers who completed more than 22 million trips. Now, it facilitates more than 30 million trips for more than 20,000 customers in its six markets.
Moove’s annual recurring revenue also grew from $90 million to $115 million during this period. the company says it is on track to achieve profitability during the next financial year.
Following the deal, Moove, driven by its partnership with Mubadala, moved its headquarters to the UAE. The UAE is important for Moove, as it introduced its fully integrated charging solution there and recorded the highest number of EV trips on the Uber platform in 2023. Delano revealed plans to step up investment in the UAE and other markets in Africa , Europe and Asia while expanding to Southeast Asia and Latin America in the coming months.
“We believe in the potential of the African market and our business in it, so we will continue to invest accordingly,” he said. “However, it is critical for these investments to be profitable. In addition, we will continue to evaluate opportunities globally and expand in markets where we see a clear path to achieving profitability or positive economic units.”
