The World Economic Forum state that Africa has an average annual demand for 2.4 million cars and 300,000 commercial vehicles. This demand is growing due to a continent-wide increase in disposable income, rapid growth of the middle class and rapid urbanization. But while most of the cars that meet this need are used, car ownership in Africa less than 45 vehicles per 1000 peopleas opposed to the global average of 203 cars per 1000 people.
We present startups in the automotive industry, highlighting famous players such as Autochek and Moove, each responding to ownership by serving consumers and drivers, respectively. However, vehicle financing is more than just the intent of consumers and drivers; There is a great opportunity to offer tailored services for sellers. Car financing is important for small car dealers because it helps them with day-to-day transactions and reduces costs. When credit is cheap, customers also benefit, bringing more cars to the road in Africa. This highlights the need for affordable financing and business solutions for car dealers.
Movement within this strategic domain is supported by YC Shekel Mobility. The B2B auto dealers marketplace has raised over $7 million in funding, consisting of $3.2 million in equity and over $4 million in debt. Co-founder Benjamin Oladokun shared in an interview with TechCrunch that the funds will be instrumental in quadrupling the startup’s current ARR of less than $2 million and capitalizing on this momentum as it prepares for its next pricing round. Just this January, the upstart announced a $1.95 million pre-seed investment led by Ventures Platform with participation from Y Combinator, Voltron Capital and Zedcrest.
These investors followed Shekel Mobility’s seed round. This time, Ventures Platform led their seed round with MaC Venture Capital. Other investors include Y Combinator, Rebel Fund, Unpopular Ventures, Maiora Capital, PageOne Lab Inc., Phoenix Investment Club, Heirloom VC, Pioneer Ventures, and other angel investors. Meanwhile, Zedvance, VFD Microfinance Bank, Zenith Bank, and Fluna, among others, provided the loan segment; others have used the Shekel Mobility platform to fund car dealerships, according to the startup.
Oladokun founded Shekel Mobility with Sanmi Olukanmi. Their combined expertise in the automotive industry, including the launch and exit of Eazypapers Technologies, a digital automotive documentation platform serving FMCG, mobility and logistics companies, laid the foundation for Shekel Mobility.
The self-described mobility fintech helps car dealers find, finance and sell cars in Africa’s $30 billion used car market. Shekel Mobility aspires to position itself as the leading platform to launch and grow a car dealership locally or virtually (it wants to build the largest car dealership ecosystem with transactions of up to $10 billion per year of 2025). To date, the auto dealer marketplace has powered transactions worth over $56 million, facilitating the growth of over 1,400 auto dealers by increasing their inventories and selling 7,000 vehicles.
At the heart of the startup’s growth is its flagship product, Shekel Credit, which offers car dealers easy access to financing, with credit limits reaching up to $200,000 for vehicle purchases. , usually falls within the range of $5,000 to $20,000. The financing mechanism involves the dealer contributing 30% of the total cost, which amounts to $3,000 in the case of a $10,000 car purchase. Shekel gives the remaining 70% as a loan to the seller. Then, upon selling the vehicle to the end customer, usually within a three-month timeframe, the car dealer remits the Shekel payment, which covers the interest on the loan and the transaction fee related to the sale of the car.
This model, where Shekel Mobility controls the end-to-end process of buying and selling vehicles through dealerships, ensures that it records a 0% default rate, Oladokun said on the call. Olukanmi, in a statement, also emphasized that while there is a huge gap in providing direct finance to car dealers, Shekel Mobility only finances car dealers who are “believed to have sustainable positive impact on consumers.”
Building on its growth over the past 20 months through its credit product, Shekel Mobility is set to introduce several offers, including Shekel Business. This product, the founders say, will look to digitize the informal trade processes within the car dealership vertical. The set of tools is designed to help sellers not only fund their inventories but also streamline sales and structuring processes. “One of the fundamental things we’ve built is the ability to buy a car without collateral,” Oladokun said. “We started with lending to dealers, but now we’re looking to provide more digital tools and physical infrastructure to reduce the cost of ownership of car dealerships.”
Kola Aina, the founding partner of the Ventures Platform, noted that Shekel establishing a significant change in market making that is essential to the expansion of Nigeria and soon the African automotive industry. In the same vein, founder and managing partner of MaC Venture Capital’s Marlon Nichols, who spoke at the round, said Shekel Mobility has the potential to transform and ignite the automotive industry in Africa as it finances and empowers small businesses in need of financing to survive. “The team has enabled millions of dollars to move into the Nigerian economy and at the same time provide locals with affordable cars,” he said.