OZÉ to receive $3M to scale its digital recordkeeping and embedded finance products

A finch startup OZÉ that provides small and medium businesses with digital record-keeping tools for their products has raised $3 million in its pre-series A round.

This comes after OZÉ managed to secure $700,00 in seed funding last year.

European early-stage VC Speedinvest opened the floor for the financing round. Cathay AfricInvest Innovation Fund, Savannah Capital and other unnamed investors also participated.

Over the period of 18 months, other startups, like Kippa, Bumpa and Sabi Cash, with similar visions and missions to that of OZÉ have increased on the African continent. 

Unfortunately for these startups, OZÉ launched before the market became hot and competitive. The company was started by the CEO, Meghan McCormick and Dave Emnett, Chief Operating Officer. It was founded on the basis of challenges Meghan noticed small and medium businesses faced when it came to record-keeping to monitor their business growth. 

“Working so closely with small business owners, I understood the problems they faced. And having seen how small businesses in the U.S. operated as a child, and seeing kind of the tech stack or the service stack that SMEs have over there, I had a good understanding of the solution set,” said McCormick on a call with TechCrunch.

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“And putting those two things together, we’ve been able to create a platform tailored to the realities of today. But also really pushing towards what’s possible for business owners in Ghana and Nigeria, who has a smartphone in their pocket.”

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Currently, OZÉ says they have a clientele of more than 125,000 even though in the long term they hope to capture the more than 100 million small and medium businesses in West Africa. To them, these businesses have used the traditional pen-on-paper methods of record-keeping but as they are building an online presence, they have been a demand for these businesses to digitise their record keeping.

OZÉ’s business app helps these medium and small businesses collate sales, expenses, payables, receivables and customer data. The data is then used as a basis to provide support including recommendations, business tips, organised seminars and on-demand business coaches.

Based on how businesses make use of the platform, OZÉ generates performance and behavioural data, which it uses to predict their credit risks and create alternative credit scores. The startup partners with financial institutions (banks and fintechs) to lend to businesses that need loans.

“OZÉ’s methods and relationship to business owners mean that loans made through the platform can be collateral-free, larger and paid back over a longer period without increasing risk,” the company said in a statement.

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The CEO said active customers on the app for 30 days or more are eligible to apply for credit. Such businesses can take an average of $5,000 whiles paying unto 36% APR. The more active a business is with its credit score, the longer such a business will have.

Similar platforms provide credit and recordkeeping services, but McCormick quickly points out what makes her company stand out. “I think the tight integration between record keeping, credit and now payments are a real competitive factor in terms of the business model that we can run. And it sets off a flywheel in the way that just being a record keeper and company or just being a digital lender wouldn’t,” the chief executive said.

“Most of the small businesses know that they should be keeping records. But keeping any records, digital or not, is a behavioural change. And so, we’ve built a strong foundation of behavioural science into our app so that OZÉ becomes habit-forming.”

OZÉ’s unique coaching and business advice connects business owners and creates a community where they can learn, grow and commerce together.

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The Ghanaian fintech recently launched a payments integration to allow its businesses to collect payments on the platform. In Ghana, businesses can accept payments via mobile money or card and a bank transfer or card in Nigeria. According to the company, businesses that use OZÉ as a choice of payment instead of using other platforms or cash will have higher credit limits and lower interest rates.

Last year, OZÉ’s active monthly users grew by 1,200%. The company said that the number of loans granted on the platform also increased by 200% from Q3 to Q4 of 2021. OZE also claims that 97% of business owners using the platform run businesses that are growing, profitable, or both. 

On the company’s next steps following its recent funding, McCormick said OZÉ would build out its team, acquire more customers, deepen its presence in Ghana and Nigeria, and begin expansion plans into new African markets.

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