Two Ugandan tech startups attract international investments

9 June 2023
ITC News

After going through the NTF V accelerator at ITC, the firms made new connections that led to significant venture capital funding

Agritech company Akellobanker and digital payment platform Xente received major investments from Renew Capital, an Africa-focused impact investment firm. The new funding, based on introductions made by the International Trade Centre (ITC), will allow them to grow their businesses in East Africa.

“The investment really means a lot, because we have money to sustainably scale in growth locally, and we are adding a new country to our operations, Burundi,” said Akellobanker CEO Jean Onyait.

When he first started working with the Netherlands Trust Fund’s programmes. Akellobanker only had five employees. They now have 19 people working on services that aim to improve the lives and incomes of small-scale farmers and other small businesses.

Although Uganda has 25 commercial banks and over 300 microfinance institutions, some 89 percent of adults don’t have an account with a formal banking institution. And about three-fourths of Ugandans live in rural areas, making farmers a major market segment.

That’s where Akellobanker steps in, with essential services that help farmers with savings and loans, finding crucial supplies, and connecting with buyers for their crops.

After three years of events, pitch practices and coaches with ITC, Akellobanker was well-prepared for the overture from Renew Capital.

“Developing a digital platform that aggregates financial data generated by the unbanked to provide easy access to credit is a key lever of growth in the informal sector,” said Renew Capital Head of Shared Growth Services JC Oelofse. “This credit from financial institutions facilitates sales of inputs to grow the informal economy.”

The investment will help drive their expansion to Burundi, while expanding efforts to reach more than 100 cooperatives in Uganda. Those cooperatives represent over 100,000 farmers and small businesses, who can use Onyait’s services to join the digital economy.

Fintech firm Xente also received an investment from Renew Capital to grow their digital banking services. Like in most of Africa, banking services in Uganda are overwhelmingly processed manually. Xente provides cost-effective ways for small businesses to take their payments digital.

“We are business to business, and typically our client would be the business owner that really wants to simplify how they pay, and also to simplify their finance operations,” said CEO Allan Rwakatungu. “Typically a payment has a lot of paperwork that goes around that process, and we automate all of that.”

With Xente, businesses can make payments using cards or mobile money. The platform facilitates bank transfers both within Uganda and abroad. And customers can pay bills or send data and airtime.

Reducing the complexities around payments saves businesses money and makes their operations more efficient.

Xente has worked with ITC since 2019. The company has inked deals with major tech players like online retailers Jumia and Köpa, as well as Uganda’s Micro Social Security Fund. The company also partnered with Visa to launch physical and virtual corporate cards -- one of the first such offerings in East Africa.

“The scale of the problem Xente is solving and the market opportunity that exists for their offering is impressive,” said Renew Capital Senior Investment Manager Diana Njuguna. “We are proud to be on this journey with Xente as it expands its business across the region.”

The investments highlight how collaboration with the NTF V accelerator pays off beyond the initial workshops and coaching.

“We had been well prepared for the export markets through the ITC initiatives, with all of the guidance and the mentorship that goes along with ITC,” said Onyait. “Now we have gotten into the growth level, so we can live our dreams.”


About the project

The Netherlands Trust Fund V (NTF) (July 2021 – June 2025) is based on a partnership between the Ministry of Foreign Affairs of The Netherlands and the International Trade Centre. The programme supports MSMEs in the digital technologies and agribusiness sectors. Its ambition is two-fold: to contribute to an inclusive and sustainable transformation of food systems, partially through digital solutions, and drive the internationalization of tech start-ups and export of IT&BPO companies in selected Sub-Saharan African countries.