African corporate cards and spend management platform Bujeti has raised $2 million in seed funding. The startup, involved with how African businesses, including SMBs, startups and enterprises, manage and handle finances, received this capital from lead investor Y Combinator and other backers, including Entrée Capital, Voltron Capital, Unpopular VC, Kima Ventures, Dropbox co-founder Arash Ferdowsi, Alan Rutledge, Tristan Walker of Heirloom VC and Mono CEO Abdul Hassan.
Bujeti targets businesses in sectors like healthcare, logistics, agriculture and construction, and facilitates the issuance of corporate cards to their employees and contractors, streamlining spending processes. The platform includes features that help these businesses control and manage expenses effectively by implementing spending limits, restrictions and approval flows for different stakeholders in the business chain, including executives, staff, contractors and vendors.
The startup, in a statement, expressed that the latest investment will accelerate its growth, expand its market presence and enhance its offerings. The roadmap for upcoming features includes introducing credit lines for SMBs and developing new products tailored for enterprises.
The two-year-old fintech, led by founder and CEO Cossi Achille Arouko and COO Samy Chiba, was launched in April 2022. Prior to dedicating their full-time efforts to the YC W23 startup, both executives initiated the development of an MVP while in their previous roles. Chiba was a project manager with the French commercial launch service provider Ariane Space, while Arouko worked at the African payments startup Paystack. It was during his tenure as the tech lead of Paystack’s commerce, subscriptions and invoices team that Arouko conceived of the idea for Bujeti.
At a time when Paystack was considering the release of an API for card issuance, Arouko revealed in an interview with TechCrunch that he and his team, while managing subscriptions and collections, identified a crucial need to assist businesses in managing their expenses. This sparked the initial concept of Bujeti. Initially envisioned as a business-to-consumer platform, Bujeti aimed to enable users to generate cards using the Paystack API. Additionally, it sought to manage expenses, facilitate online remittance payments and automate remittance processes for individuals outside the continent. However, it made a pivot to service businesses months later.
“While still serving consumers, I did some research and found other players that were using Paystack as well, one of them being Divvy [now BILL] in the U.S. It was the same idea but was towards businesses,” the chief executive said on the call. “That made me realize that there was also a market for businesses. We used Divvy at Paystack then, and each employee had an account to manage our expenses, cards and reimbursement requests. Seeing Divvy and other platforms tackling expense management in the U.S., Europe and Nigeria, that’s when I thought we could work on that for this market.” Unicorns Ramp and Brex are the most notable examples globally.
Corporate cards are usually issued by a business to select employees, typically upper management, enabling them to make payments on behalf of the company. While firms in the U.S. and EU can quickly obtain multiple cards from banks with high card penetration, the process is not as straightforward in Africa, where card penetration is still low, particularly for traditional businesses in agriculture, logistics, healthcare and construction (despite not being heavily tech-oriented, these industries significantly contribute to the GDP of many African countries).
As a result, businesses often share a single card to address this, leading to security, control and fraud issues. Bujeti’s platform wants to solve this by allowing African companies to issue cards to their employees at will while maintaining control of their spending.
“What this brings to employees is the freedom of spending. So, a company can set up a budget or a sub-account for a group of employees to spend from. Then set up policies and approval rules around the funds, and let the employees make the payments — that facilitates the operation, speeds up things and prevents them from waiting for someone always to come to approve your expenses,” noted the CEO, who also described the platform’s functionality in automating reimbursement.
In the last eight weeks, Bujeti has onboarded nearly 1,000 businesses across the continent, ranging from SMBs to startups such as Mono, Spleet and Eden Life, noted Arouko, adding that the startup aims to reach ₦200 million (~$200,000) in processed transactions soon.
Bujeti’s competitors in the African market include startups like Duplo, Flex Finance, Allawee and another YC-backed startup, Boya, according to Arouko. One key differentiator he highlights is that while some platforms focus on singular features like expense management or corporate cards, Bujeti offers both functionalities. In cases where platforms offer both features, Bujeti sets itself apart by providing superior automation features and multi-entity management. This allows users to efficiently oversee teams across diverse locations, departments, or geographies.
Furthermore, Bujeti is actively working on introducing a multicurrency feature. This enhancement will enable businesses to pay their staff in different countries, positioning Bujeti to expand its services internationally when the opportunity arises.
Hassan, an investor in the funding round and co-founder of Mono and OyaPay (a startup he founded with Arouko, now defunct), said of the investment: “Investing in Achille and Bujeti was an obvious choice; they address a significantly fragmented market with capable founders who excel in technical and business aspects. We believe in their potential to transform how businesses handle their finances, and we’re excited to be a part of their journey.”
Source @TechCrunch
