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Cape Town based insurtech startup Nobuntu will use an investment it raised from Blue Garnet Ventures to develop and launch its flagship savings product, the People’s Fund, CEO Tyron Fouche revealed today (30 April).
It follows a statement earlier today in which Crossfin announced that it had taken a “significant stake” in Nobuntu via its angel investment arm Blue Garnet Ventures. As part of the deal, Crossfin’s portfolio company Crossgate will also take a stake in the insurtech.
Nobuntu was founded in 2017 by CEO Tyron Fouche, CFO Reka Borole and COO Ross Tasker.
Nobuntu was founded in 2017 by CEO Tyron Fouche, CFO Reka Borole and COO Ross Tasker
The insurtech’s current offerings include a funeral cover and its flagship peer-to peer pension savings product called The People’s Fund that provides greater returns to customers the longer they live.
Fouche (pictured above, middle) told Ventureburn the startup will use the investment to develop and launch The People’s Fund. “We’ll also use the invested funds to develop bespoke insurance products suited to Crossfin’s portfolio company distribution rails,” he added.
He declined to disclose the size of Blue Garnet Ventures’ investment as well as how big a stake the firm had acquired in the deal. “This is confidential as there is still a condition precedent that needs to be fulfilled before the deal is finalised,” he told Ventureburn.
He said the startup was initially looking for a distribution partnership with Crossfin portfolio company iKhokha when it was introduced to the fintech holding company.
Fouche explained that Nobuntu initially engaged with Crossfin on the strength of the firm’s distribution rails.
“In discussions with them, it quickly became clear that we are aligned in terms of our values and from a strategic perspective. It is also clear to us that there are synergies that we can leverage,” he said.
The discussion, he explained, then developed into structuring what Fouche described as a “mutually beneficial deal” where Crossfin would provide Nobuntu with growth capital and the potential to leverage their extensive distribution network.
Crossfin co-founder and CEO Anton Gaylard said the firm will help scale Nobuntu’s market offering by giving the startup’s team access to “extensive channels” established by Crossfin’s portfolio companies.
Crossfin’s portfolio companies — which include wiGroup, iKhokha, Crossgate and Innervation — will be able to provide Nobuntu access to more than 9000 retail stores with more than 110 000 point of sale lanes as well as 13 500 mobile point of sale (mPOS) merchants in seven African countries.
Nobuntu was one of 20 tech startups from Kenya, Nigeria and South Africa selected for UK’s Department for Digital, Culture, Media and Sport’s Go Global Africa 2019 programme.
Last year the startup was named as one of four African startups selected for a $50 000 investment from US-based fintech accelerator Digital Financial Services Lab (DFS Lab).
Featured image: Nobuntu founders CFO Reka Borole, CEO Tyron Fouche and COO Ross Tasker( Supplied)