Africa’s mobility startups: Electric and global ambitions fuel funding surge

This article was contributed to TechCabal by Conrad Onyango via bird story agency.

In 2021, Nigerian mobility startup Metro Africa Xpress (MAX) became Africa’s most-funded startup in the electric vehicle (EV) space after netting a $31 million round to expand into Ghana and Egypt.

In 2023, Nigerian mobility startup Moove more than doubled that, netting $76 million in funding for its global expansion.

Now, Uber is reportedly looking to back Moove with an additional US$100 million in a funding round that could take Moove’s total funding since it was founded, to US$335 million. According to a Bloomberg report, that would boost Moove’s valuation from US$650 million to $750 million and take it closer to becoming a mobility unicorn (a startup with a value of over $1 billion).

So far in 2024, a $24 million in funding clinched by Kenya-based electric mobility standout Roam is the largest funding round in the sector.

The funding is a blend of $14 million in equity and $10 million in debt, from the prestigious US government’s Development Finance Corporation (DFC).

Roam said it will leverage the new funding to expand its production of locally designed and manufactured electric motorcycles and buses.

“As Africa embraces the move toward electric vehicle technology, we are proud of our impact on the environment and livelihoods across Kenya and the wider continent. This funding is a critical step for Roam to achieve our strategic objectives in scaling up and increasing utility to our customers,” said Roam’s Chief Finance Officer, Rajal Upadhyaya.

While some of Africa’s mobility startups are planning to bolster their offerings to include electric vehicle production, fleet purchase and financing, others are setting their sights on regional and overseas expansion to tap into a multi-billion dollar market being driven by rising demand for cheap, low-emissions transport.

A recent raise of $10 million in new debt by Nigeria’s Moove was to fuel its overseas expansion in India, the mobility company said.

The vehicle financing startup said the funding would strengthen its India presence by allowing it to expand operations to three additional Indian cities – Delhi, Pune, and Kolkata.

The startup entered the Indian market in 2023, following a strategic partnership with Uber that targets the introduction of 25,000 electric vehicles in the Indian market. The company currently operates in Bengaluru, Mumbai, and Hyderabad in India and boasts a presence across nine markets in Africa, Europe, Asia, and the Middle East.

Another Nigeria-based mobility operator, Shekel Mobility, recently announced securing $7 million in funding to propel its growth and expansion plans. Shekel is a B2B auto dealers’ marketplace that enables users to find, finance, and sell cars. The startup has an ambitious transaction goal of $10 billion annually, by 2025.

Over its 20 months of operations, the startup said it has facilitated more than $56 million in auto dealer transactions and supported over 1,400 dealers.

“We have positioned ourselves as a transformative force in the African automotive market. This infusion of $7 million in fresh funding is poised to enhance our financial services, expand into new markets, and sustain our impressive growth trajectory,” Shekel said in a statement.

With Francophone Africa continuing to attract foreign startup investments, Senegalese startup, Mbay Mobility has also thrown its 10-year rollout plan into the mix.

The startup, which began piloting electric vehicles in 2022, announced in January it was actively seeking funding to purchase a fleet of 33,000 electric taxis for rollout in Accra, Dakar, and Abidjan. The startup has yet to disclose its funding target.

Earlier this year, Oliver Wyman, a global management firm, in a report titled ‘Shared Mobility’s Global Impact’ projected Africa’s shared mobility market size would grow from $4.2 billion in 2023 to $7.8 billion by 2030.

Growth in the market will come from ride-hailing, e-bike and scooter rentals and car-sharing, driven by Africa’s fast-growing urban population on a continent with the world’s largest population under the age of 30.