Nigeria-based startup Zuvy has successfully raised $4.5 million in funding, marking a significant milestone in its mission to revolutionize invoice financing for small and medium-sized enterprises (SMEs) across Africa. The emerging company, established in 2021, aims to address the prevalent challenges faced by SMEs in managing cash flows and securing prompt payments.
Zuvy’s journey began with an unexpected encounter on Twitter, where co-founders Angel Onuoha and Ahmad Shehu discovered their shared vision of digitizing financial services and supporting African small businesses. Recognizing the prevalent issue of payment delays impacting SMEs in Nigeria, the duo decided to tackle this problem head-on.
Large corporations in Nigeria often take up to 90 days to settle invoices, putting strain on the financial resources of SMEs. Zuvy aims to alleviate this burden by offering innovative invoice financing solutions tailored to businesses operating in the fast-moving consumer goods (FMCG), healthcare, and supply chain sectors—where payment delays are most acute.
To access Zuvy’s groundbreaking financing solution, businesses simply submit their invoices, allowing Zuvy to provide them with much-needed cash. To ensure transparency and facilitate repayment, Zuvy establishes a direct connection with the receiving businesses, who confirm their relationship with the invoice-issuing businesses and commit to repaying Zuvy. Repayment terms are flexible, ranging from 30 to 90 days, accommodating the unique needs of each business.
By leveraging these connections and adopting stringent internal metrics, Zuvy enhances the credibility of loan applications, streamlines the repayment process, and reduces the risk of default. This approach makes invoice financing a more accessible and appropriate option for small businesses seeking capital compared to traditional loans.
Angel Onuoha, previously a product manager at Google and co-founder of BLK Capital Management, and Ahmad Shehu, a former product engineer at Mono, bring their expertise and vision to drive Zuvy’s growth and impact on the financial services landscape.
Zuvy operates on a revenue model that includes charging a fee for cash advances. Users also gain access to a digital wallet, made possible through strategic partnerships with select commercial banks. Zuvy’s integrated inventory management tool empowers users to issue invoices and efficiently manage their finances. This feature enables Zuvy to determine suitable financing levels for each business, tailoring offers based on specific requirements and repayment capacity.
Leading the funding round is TLG Capital, a prominent investment firm, with a combination of debt ($4 million) and equity ($580,000). Numerous venture capital firms and angel investors also participated in the funding round. The debt portion will play a crucial role in expanding Zuvy’s loan book, meeting the increasing demand from vendors across Nigeria.
Zuvy’s innovative approach to invoice financing and unwavering commitment to supporting SMEs in Africa position the company as a game-changer in the financial services landscape. With secured funding, Zuvy is poised to revolutionize how SMEs manage their cash flows, empowering them to thrive and contribute to the region’s economic growth.
