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Tag: TUGENDE

  • Tugende begins repayment of defaulted $5M Goldfinch loan

    Tugende begins repayment of defaulted $5M Goldfinch loan

    Tugende, a Uganda-based venture-backed lender, and Warbler Labs, a company that is building Goldfinch, a decentralised credit protocol, have reached an agreement on a plan to restructure a loan, which may lead to the recovery of the $5 million loan that the East African motorcycle taxi financing company defaulted on several months ago. Tugende is based in Uganda, and Warbler Labs is based in the United States.

    According to an investor update, Warbler Labs has reached a “agreement in principle” with Tugende and its backers, which includes a strategic investor, regarding the restructuring of the company. An “agreement in principle” is an arrangement that establishes the groundwork for a contract.

    The details of the deal were not disclosed to the general public. Michael Wilkerson, co-founder and CEO of Tugende, declined to provide specifics regarding the reorganisation plan but promised more information would be provided in the upcoming weeks. “There is a larger transaction and a strategic investor coming together,” he said.

    Read also: TUGENDE raises $10 million in series B funding

    When Tugende made their decision

    Following Tugende’s default on the $5 million in October 2021 that it had borrowed from Goldfinch protocol for its Kenya activities, the company has decided to restructure the company. Up until May of this year, Tugende was current on the payment of the monthly interest of $53,400. This was five months before the principal amount became due. It went into default in June, which caused widespread anxiety among the Goldfinch community.

    Goldfinch is a decentralised lending protocol powered by a16z that enables companies in emerging regions to acquire crypto loans without the initial requirement of possessing any crypto assets. This is in contrast to the majority of DeFi platforms, which demand borrowers to stake crypto assets with a value that is greater than the amount of the loan they wish to obtain.

    The objective of the Goldfinch protocol is to make it simpler for organisations located outside of the United States, like Tugende, to gain access to cash based on off-chain collateral. As an illustration, Tugende pledged all of his possessions, including his bank accounts, as collateral.

    The business based in the Bay Area has created capital pools, one of which is called “senior,” which invests in diverse portfolios. This makes it possible for companies like Tugende to receive money from investors who are involved in the protocol.

    Goldfinch has had its first significant setback since its start as a result of Tugende’s default on its loan. However, lending to firms, particularly those that conventional financial institutions are not very enthusiastic about, has dangers.

    Tugende’s efforts so far

    According to the most recent investor update, Warbler Labs has signed a term sheet with Tugende, agreeing in principle to a comprehensive restructuring plan. This plan has the potential to result in a material recovery for the Goldfinch Senior Pool. This represents a shift in tone from the previous post, which suggested that a restructuring could result in losses, possibly extending to the entire amount of the loan.

    “If the restructuring successfully closes at the indicated terms, the potential net write-down of the senior pool’s NAV [net asset value] due to the Tugende default may be reduced from approximately 3.95% to less than 0.79%,” Warbler Labs said.

    In the report that was provided in July, it was stated that it was expected that the NAV of its senior pool would suffer a write-down of 3.95% during the course of the four months leading up to October.

    Warbler Labs believes that the reorganisation and the first payment will take place before the end of the year. The company was quick to note, however, that it will be depending on the existing facts and circumstances, which will include the completion of any necessary legal work and regulatory permissions. However, it’s possible that it will be delayed because of unanticipated complications that might come up.

    “This is the first loan restructuring of this kind on the Goldfinch platform. Warbler Labs and Goldfinch will keep the community and investors apprised of the recovery efforts and remain committed to transparency and accountability,” Warbler Labs assured.

  • TUGENDE raises $10 million in series B funding

    TUGENDE raises $10 million in series B funding

    Tugende has completed a pre-Series B equity funding round with current shareholders led by Partech and two new investors, including Women’s World Banking.

    Tugende is a digital platform that offers credit and asset financing to micro, small, and medium-sized businesses in East Africa. According to reports, Verdant Capital helped Tugende raise money by acting as a financial advisor and an arranger for both equity and debt offerings.

    The new investors broaden the scope of Tugende’s shareholder base and bring complementary expertise and experience to the table, both of which will facilitate the company’s continued expansion.

    Tugende’s balance sheet has been further strengthened by a combined USD 10 million investment, which, along with a recent debt closing, further strengthens the balance sheet. This lets Tugende grow its portfolio and meet a big need for credit among small and medium-sized businesses, especially after the strict lockdowns of 2020 and 2021.

    Read also: Vodacom Launches App to Connect SA Youth to Jobs

    Tugende has helped over 55,000 people in Uganda and Kenya

    Tugende is a lender that is supported by digital technology and specializes in credit rating and asset financing. More than 55,000 customers have been helped in the countries of Uganda and Kenya to create credit profiles and acquire assets that generate income. This has enabled them to access more opportunities as their enterprises have grown. More than 900 employees work hard to make sure that Tugende remains the best place to get credit for micro, small, and medium-sized businesses (MSMEs) and to keep the company’s portfolio quality and cost of risk at the top of the market.

    “We’re excited to join Tugende’s journey,” stated CJ Juhasz, Chief Investment Officer of Women’s World Banking Asset Management (“WAM”). “WAM” stands for Women’s World Banking Asset Management. Tugende is a market leader when it comes to addressing underprivileged individuals and businesses to de-risk their access to financial services so that they may expand and create new jobs.

    Women’s World Banking is committed to the economic empowerment of individuals, and as part of this mission, we are particularly interested in investing in areas where mobility and finance intersect. In these areas, the potential for economic empowerment of individuals, particularly women, is amplified.

    The leadership of Tugende is visionary, cares profoundly about the organization’s mission, and possesses the experience necessary to carry out the organization’s ambitious plans. We’re looking forward to working with Tugende as it tries to support more women in its business ecosystem and makes it easier for people all over Africa to get money.

    WAM makes investments in forward-thinking, inclusive financial companies in emerging nations. These companies are then guided by WAM to capture the large market share of financially underserved women and the substantial talent pool of women working in and leading these organizations.

    The Women’s Alliance for Microfinance (WAM) initial fund was a trailblazer in the field of gender-focused impact investing in inclusive financial service providers. In WWBCP II, the gender-focused investment approach is expanded to include innovative financial service providers. There is also a specialized technical assistance center to help portfolio companies achieve their strategic goals, including those owned by women.

    Tugende’s co-founder and current CEO, Michael Wilkerson, has the following to say about the company’s commitment to innovation and partnerships: “Tugende is committed to removing barriers for people and businesses so that they can build better futures.” With partners like WWB, Tugende will be able to use the extra knowledge to reach its Gender Action Plan goals and get more women entrepreneurs involved in its ecosystem.

    Connecting African Creatives with Remote Jobs in the US; Meaningful Gigs Raises $6M Seed

    About Tugende

    Tugende is a social company in Uganda that was formally created in 2012 and operated for profit. They enable micro, small, and medium-sized enterprises (MSMEs) in the informal sector to drastically boost their economic trajectory by utilizing asset finance, technology, and a concept that is centered on the client.

    They serve approximately 52,000 customers in Uganda and Kenya with the help of more than 800 full-time employees, and we are rapidly expanding while also introducing new ideas.