Lidya, a leading lending fintech startup based in Nigeria, has raised $8.3 million in a pre-series B funding round to scale operations.
The lending startup has now raised a total of $16.5 million, including a $1.3 million seed fund in 2017 and $6.9 million in 2018.
The pre-Series B funding round was led by Alitheia Capital, through its uMunthu Fund. Bamboo Capital Partners, Accion Venture Lab and Flourish Ventures were the other investors.
Founded in 2016 by Tunde Kehinde and Ercin Eksin, Lidya provides loans to Small and Medium-scale Enterprises (SMEs) in the farming, hospitality, logistics, and retail, real estate, technology and health industries.
Lidya, unlike most lending companies, funds its loan book with equity rather than debt finance. Although it is an unusual strategy, Kehinde explains why the startup felt it was required.
“The idea was for us to show that our algorithms work and that we can disburse money into the market and get it back. Then we can transition to using debt for our lending operations,” the CEO said as the company looks to finalize deals with banks, family offices, and hedge funds in the coming months. This is in addition to the $300,000 line of credit Lidya has secured from Bamboo Capital Partners.
At the height of the pandemic, Lidya began lending in Europe. Kehinde recalls how difficult it was for the team, especially during such an odd moment.
“It is difficult enough to attempt to launch in two new countries but try doing that remotely,” he said. “We’re so decentralized. We had operations in Nigeria, and we were launching in Eastern Europe remotely, making sure the puzzle stays together. The team really stepped up. Everyone doubled down on the mission and we came out of the year without having any deterioration.”
