A seed investment round for Emata, a financial technology and microfinance organization based in Uganda, was successfully completed with $2.4 million in funding.
The fund includes an equity component of $800,000 and an on-lending capital component of $1.6 million. The business claims that the cash will assist it in expanding its offerings of agri-loans across the East African area.
Emata’s seed raise was sponsored by a limited number of investors, according to a statement that was submitted to Technext. One of these is African Renaissance Partners, a venture capital firm with a focus on providing assistance to businesspeople based in East Africa and the Horn of Africa. One other backer is Norrsken Accelerator, which is an investment arm of Europe’s largest ecosystem for impact technology. In addition to them, Zephyr Acorn, Marcus Bostrom, and the Draper Richards Kaplan Foundation are investors.
In a region of East Africa that suffers from a severe lack of agricultural financing, Emata has developed a business model that fills this gap. This is accomplished by the provision of automated loans to agriculturalists. When this is done, the costs associated with getting loans are reduced. For example, farmers can receive loans from Emata at rates that are five times more reasonable than the informal loans that have been their go-to option for many years. These loans have been their primary source of financing for a significant amount of time. In addition, quick payout is provided to farmers, and the requirement that they provide collateral is waived.
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Remarks from the CEO of Emata
Bram van den Bosch, the founder and CEO of the company, expressed his excitement on the financing. In his words: “We are thrilled to complete our $2.4 million seed fundraise, backed by high-profile, impact-oriented investors who recognize the huge potential of digital agri-loans in East Africa, and beyond.”
He went on to shed light on the objective of Emata, which is to provide farmers with the ability to have big aspirations. He went on to say that his new company assists farmers by removing the typical roadblocks that have made it challenging for the vast majority of farmers to obtain agricultural loans. He went on to explain the services that his organisation provides and said.
“Our solution turns a lifelong struggle into a five-minute process, and is already tangibly impacting thousands of East African farmers.”
As was previously said, the next step for Emata is to increase the market solutions it offers. The financial technology start-up will most likely make its next visit in Tanzania, which is located in close proximity to Uganda, where the company’s main office is located. In addition to increasing its focus on the potato industry, Emata will prioritise expanding its presence in the dairy and coffee areas.
Emata has captured the attention of people all over the world despite the fact that it is less than five years old. It triumphed over 80,000 competitors from all around the world to win the “Best Newcomer / Best New Startup” prize at the 2023 Global Startup Awards. In addition to that, the Yale Africa Startup Review included it on their list of the top 30 startups to watch in the year 2023.
Emata also had a successful year in 2022, as evidenced by the company’s year-on-year growth rate of sevenfold. In addition to this, it brought its total number of partners up to fifty, established connections with more than forty thousand farmers, and distributed loans totaling one million dollars.
What Emata investors think
Magdi A. Amin, Managing Partner at African Renaissance Partners remarked “We are delighted to back Emata – the digital and affordable solution for East African farmers. Our portfolio is geared to high-growth companies that use technology to solve real problems that Africans face every day.”
He continued by saying that he was delighted to work with the people behind the startup because it has a promising feature.
Emata is among the rare breed of early-stage firms that has an exceptional business strategy, according to Kanini Mutooni, the Managing Director of Draper Richards. Alex Bakir, a General Partner of Norrsken, provided an explanation to justify the company’s decision to invest.
“Norrsken Accelerator invested in Emata because we believe their team and model places them in the top 1% of impact companies, globally.” he said.
