Sparkle Closes $3.1m Seed Funding Round Led By Leadway Assurance
Sparkle closes $3.1m seed funding round led by Leadway Assurance
Sparkle has raised $3.1 million in a seed round of funding to help it expand its operations in Nigeria.
Leading the round was Leadway Assurance, with participation from Trium Network and an unidentified number of angel investors. The investment comes on the heels of Sparkle's recent $2 million pre-seed round from friends and family.
Sparkle was founded in 2020 by Uzoma Dozie, who previously served as the CEO of Diamond Bank prior to its merger with Access Bank. In addition to standard banking functions such as saving, bill payment, top-ups, and requesting or sending funds, Sparkle also offers a variety of other services. In addition, it includes less-common features such as bill splitting and spending breakdowns, which are not always available.
On the individual banking side, the digital bank, which launched in 2019, claims to have already accumulated more than 40,000 customers since its launch. The company started charging small fees to individual customers to keep their accounts up to date in order to generate revenue. It plans to charge businesses for the majority of services except taxation in order to generate more revenue.
Aside from that, Sparkle offers a platform called Sparkle Business, which is targeted specifically at small and medium-sized businesses. SME's who have a tax identification number (TIN) and an email address are eligible to use these services. For businesses, these are the least expensive types of documentation that can be obtained.
As stated by Sparkle, the new business arm has been well received by this segment, which now has access to inventory and invoice management, tax advice, payroll and employee management services, among other things. According to reports, approximately 2,000 businesses have taken advantage of this platform.
The company's mission is to provide Nigerians with financial, lifestyle, and business support services. Currently, the company employs over 1,000 people. In order to assist with mundane and repetitive tasks, Sparkle will use the new funding to develop robotic process automation. The company will also use the funds to expand its talent acquisition efforts across engineering, finance, risk, and marketing.
Instead of pursuing funding from institutional venture capitalists, Sparkle's CEO explained that he chose this particular group of investors because they were familiar with the Nigerian market and had the necessary experience to assist Sparkle in scaling.
Sparkle differs from other digital banks in that they are able to provide banking services to both individuals and businesses on a single platform, which makes them stand out from the competition.
Despite the fact that the digital bank is still in its infancy, it already has a license as a microfinance institution. Additionally, it has formed a partnership with Visa to enable users to make in-person or digital payments using their Visa credit or debit card. Collaborations with organizations such as Network International and PwC Nigeria are also underway.
The increasing use of technology in banking is proving to be extremely effective in terms of accelerating financial inclusion in Nigeria, according to the World Bank. Particularly relevant now that mobile broadband penetration is on the verge of reaching 50%. Affiliation: Sparkle is a financial services company that uses technology to provide Nigerians with not only financial services, but also lifestyle and business assistance.
