Watu has secured $7 million in strategic debt financing to increase its capacity to finance mobility and connectivity assets across selected African markets. The facility from AHL Venture Partners will support the company’s working capital needs and help it expand its motorcycle, three-wheeler and smartphone-financing operations.
The investment will strengthen Watu’s balance sheet as it scales its lending activities. It could also help more customers access assets that support work, mobility and everyday connectivity.
The facility builds on a financing relationship between Watu and AHL Venture Partners that began in 2022. According to AHL, the latest investment reflects its continued focus on responsible asset finance and expanding access to mobility and connectivity assets.
Supporting mobility and connectivity
Founded in 2015, Watu operates two main business lines. Its mobility division finances motorcycles and three-wheelers, while Watu Simu finances smartphones. The company has also recently started expanding its financing of electric motorcycles in selected African markets.
Watu says it has originated more than 7 million loans since its inception. Its operating model is based on streamlined onboarding processes, flexible repayment structures and local market expertise. These systems are designed to help the company maintain consistent services as it expands across different products and markets.
Rosanne Whalley, CEO of AHL Venture Partners, said the partnership would support Watu’s continued growth and its wider impact on underserved customers.
“Watu’s asset-backed model is expanding financial inclusion and clean mobility for millions of underserved customers,” Whalley said.
The financing will support Watu as it continues to grow its mobility and smartphone portfolios. The company currently operates in Kenya, Tanzania, Uganda, Rwanda, the Democratic Republic of Congo, Nigeria, Sierra Leone and South Africa. It also has operations in Mexico and Brazil.
Andris Kaneps, Founder of Watu, said the new facility would give the company greater capacity to expand while maintaining its focus on serving customers responsibly.
“This facility strengthens our working-capital base and gives us additional capacity to expand our mobility and smartphone-financing portfolios,” Kaneps said.
The expansion of electric motorcycle financing is also part of Watu’s wider mobility strategy. By increasing access to electric motorcycles in selected markets, the company is looking to support cleaner forms of transport while continuing to provide financing options for customers who depend on motorcycles for their livelihoods.
A wider focus on African businesses
The Watu facility follows AHL Venture Partners’ recent announcement of the second close of its AHL Africa Credit Fund I (ACF). The fund has raised $45.5 million from family offices and foundations and is moving towards its $70 million target.
The latest close includes a $15 million senior facility. Ceniarth provided $5 million, while a co-investor provided the remaining $10 million.
Anchored by the AHL Foundation, the fund is structured to attract private capital from high-net-worth individuals, family offices, local asset managers and foundations seeking exposure to African credit markets.
ACF provides senior secured, mezzanine and bridge loans ranging from $2 million to $10 million to high-growth and profitable businesses across East, West and Southern Africa.
Whalley said the fund was created to help address the challenge of connecting growing African businesses with suitable sources of capital.
“There are brilliant, high-growth businesses across the continent solving real problems,” she said. “But, there is a matching problem in finding a structure that works for both.”
She added that AHL’s aim is to work with capital allocators to increase the flow of funding into African private markets.
For Watu, the $7 million facility is not dilutive to its equity. Instead, it provides a direct injection of capital to strengthen its balance sheet and support the continued expansion of its lending operations.
