BFREE gets $2.95 million in funding. Data collection startup and company has reportedly just closed a $2.95 million funding round that was led by Capria Ventures.
BFREE Gets $2.95 Million in Funding
Other key participants in the latest funding round of BFREE include Angaza Capital, GreenHouse Capital, Launch Africa, Modus Africa, and Axian CVC, with additional support from various angel investors.
In a notable strategic shift, CEO and Co-founder Julian Flosbach revealed in an interview with TechCrunch that BFREE has transitioned its focus towards collaborating primarily with banks, diverging from its previous emphasis on partnerships with fintech companies, which constituted a significant portion of its clientele in 2022.
Explaining this pivot, Flosbach cited the pressing need to bolster the company’s profit margins, highlighting the imperative to either raise prices or part ways with smaller clients. As a result, BFREE has strategically realigned its business model to prioritize engagements with banks, recognizing the substantial loan portfolios they possess in comparison to digital lenders. Presently, a significant proportion, accounting for 70% of BFREE’s revenue, is derived from its collaborations with banking institutions.
BFREE’s Initial Strategic Approach
To gain deeper insights into BFREE’s initial strategic approach, one can refer to a comprehensive article penned by Victoria in 2021, titled “How Nigerian credit fintech startup, BFREE, is helping Africans repay their loans.”
In terms of its operational performance, BFREE currently manages a substantial loan portfolio valued at over $400 million. Impressively, the company has achieved a commendable collection rate of 12.5% on its outstanding loans, underscoring its effective debt recovery strategies.
BFREE Plans To Establish a Secondary Debt Market
Looking ahead, BFREE has ambitious plans to establish a secondary debt market, facilitating the purchase of non-performing loans (NPLs) from banks across Africa by third-party investors. This initiative aims to enhance liquidity in the market while offering investors opportunities to acquire distressed debt assets.
In terms of funding, BFREE has demonstrated robust success, having raised a total of $6.5 million in funding to date. Notably, the company secured an undisclosed bridge funding round amounting to $1.1 million in the preceding year, reflecting investor confidence in its growth prospects and strategic vision.
BFREE’s Efforts on Consolidating Its Presence in Its Existing Markets
Despite its promising trajectory, BFREE has opted to concentrate its efforts on consolidating its presence in its existing markets, namely Ghana, Nigeria, and Kenya. As part of this strategic focus, the company has decided to suspend its expansion plans into Asia, South America, Europe, and additional regions across Africa, which were previously announced in 2022.
This strategic decision underscores BFREE’s commitment to optimizing its operations and maximizing its impact within its core markets before pursuing further expansion initiatives.
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