Fund provider-GrowthBond has extended credit to over 300 companies in Kenya less than two years into its operations, becoming a major contributor to the growth of e-commerce in the country.
Founded in mid 2018, the Copenhagen, Denmark-based firm provides funding for small companies to run online marketing with assistance from advertising experts.
It provides loans of $100 for businesses that don't have any proven digital advertising track record and up to $50,000 - for those who have experience of running digital advertising.80 per cent of the loan covers ads expenses and 20 per cent goes to marketing expert who runs the campaigns.
Targeted businesses are local commerce such as restaurants, real estate agencies, e-commerce, and tech startups.Among beneficiaries are small businesses at Kakuma refugee camp that get loans for running digital advertising.
GrowthBond also educates local freelancers who get to work as marketing experts for funded companies.
“We are organizing people from the world’s most remote or isolated areas such as the refugee camp where people are yearning to breathe free and willing to invest in the hope of a better future,” GrowthBond CEO Ferdinand Kjaerulff notes.
The firm which is keen in availing growth capital to small businesses in African countries evaluates businesses based on their Facebook accounts or pages, Google data, and online activity.
Loans are repaid with a fixed 20 per cent commission, once the company receives new paying customers."If the business starts making a profit, it pays the loan with a fixed 20 percent commission. However, when it cannot break even, Growthbond takes the loss,” Kjaerulff explains.
The firm has a presence in Kenya, Nigeria, and the Gambia where it has so far funded over 1000 companies.It aims to finance 60,000 companies by 2022, according to Kjaerulff.
