YAKUB ABDULRASHEED – South African fintech startup Kuunda has completed a $5 million secondary share sale led by investment firm E4E Africa, providing an opportunity for early investors to realise returns while strengthening the company’s long-term shareholder base.
The transaction comes as Kuunda reports significant growth in its digital lending operations, having facilitated more than 870 million loans worth over $4.4 billion to 14.6 million agents, merchants and consumers.
Established in 2018, the company provides digital lending infrastructure that enables financial institutions and digital platforms to extend credit to underserved businesses and individuals.
The latest deal also sees existing investors increase their stakes, highlighting growing investor interest in Kuunda’s business model and the potential of Africa’s digital financial services sector.
What is Kuunda and Its Digital Lending Business
Kuunda is a business-to-business (B2B) financial technology company that provides lending-as-a-service infrastructure, helping banks, mobile money operators, point-of-sale (POS) network providers and e-commerce platforms offer credit to their customers.
Founded in 2018, the company integrates digital lending solutions into existing financial platforms, using data-driven credit scoring to assess borrowers and facilitate access to financing.
Its services primarily target mobile money agents, merchants and consumers in emerging markets, particularly those who may struggle to obtain credit through conventional banking channels.
By working with established financial service providers, Kuunda enables lending partners to incorporate credit products into their operations without necessarily building the entire technological infrastructure themselves.
Its approach is designed to make financing more accessible to small businesses and individuals who need funds to sustain their activities, manage cash flow or meet other financial needs.
What the $5 Million Secondary Share Sale Means
The $5 million transaction is a secondary share sale, meaning existing shares in Kuunda changed ownership rather than the company raising an equivalent amount of fresh capital for its operations.
The deal allows some early investors to sell shares and realise financial returns, while E4E Africa increases its ownership stake in the business.
Existing investors Accion Ventures, Portugal Gateway Fund and Seedstars Africa Ventures have also increased their positions in the company.
The transaction therefore combines liquidity for some shareholders with continued investment from others who want to maintain or expand their exposure to Kuunda’s future growth.
The development is significant for Africa’s startup ecosystem, where investors often have to wait years for an acquisition or an initial public offering (IPO) before selling their shares.
Kuunda says the deal demonstrates that African fintech companies can create opportunities for investors to realise returns before reaching either of those major milestones.
Kuunda’s Growth and Expanding Market Reach
Kuunda’s latest transaction follows substantial growth in its lending operations. According to the company, its infrastructure has facilitated more than 870 million loans, delivering over $4.4 billion in credit to 14.6 million agents, merchants and consumers.
The company is currently operating in five markets and plans to launch in seven additional markets, signalling ambitions to extend its reach across more emerging economies.
Its business model relies on partnerships with financial institutions and digital platforms to connect eligible borrowers with credit through services they already use.
The reported lending figures reflect the cumulative volume of credit facilitated through its infrastructure, rather than the company’s revenue or profit. Nevertheless, the scale of its operations illustrates the reach of its technology and the demand for digital lending solutions.
Its planned expansion will test its ability to sustain growth while continuing to provide financing that meets the needs of small businesses and consumers.
Kuunda’s Leadership and Milestones
Kuunda’s chief executive officer, Andrew Milne, described the transaction as a major milestone for the company and its investors, pointing to the strength of the business and its ability to expand.
“This is an important milestone for Kuunda and our investors,” Milne said. “Delivering a successful secondary at this stage reflects the strength of the business we’ve built, profitable, scalable lending infrastructure serving millions of people across Africa.”
He added that the company was grateful to its early backers and looked forward to growing with a strong, aligned shareholder base.
Meanwhile, Bas Hochstenbach, managing partner at E4E Africa, highlighted Kuunda’s combination of technology, distribution networks and banking partnerships in expanding access to financial services.
“Kuunda is an exceptional company, building a very healthy and fast-growing business while offering much needed products at fair prices to African small businesses and consumers,” Hochstenbach said.
The comments underscore the investors’ confidence in Kuunda’s business model and its potential to expand access to financing across African markets.
Previous Funding and What Comes Next
The secondary share sale follows Kuunda’s $7.5 million pre-Series A funding round, reported last year by Disrupt Africa. E4E Africa participated in that round alongside Portugal Gateway Fund, Seedstars Africa Ventures, 4Di Capital, Accion Ventures and Nedbank.
The earlier funding provided backing for the company’s development, while the latest transaction creates an opportunity for existing shareholders to realise returns and for participating investors to increase their stakes.
Going forward, Kuunda’s priorities will include expanding into additional markets, sustaining the growth of its lending infrastructure and maintaining partnerships with financial institutions and digital platforms.
Its ability to balance expansion with responsible lending and affordable credit will be important as it reaches more customers.
The deal also offers a broader indication of how African fintech investment is evolving, with secondary transactions creating alternative routes to liquidity for early investors.
For Kuunda, the challenge will be to build on its existing scale and translate its growing market presence into sustainable long-term business performance.
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