Bloom, a Sudan-based fintech offering a high-yield savings account and adjacent digital banking services, has raised a $6.5 million starting round. This investment comes after the startup’s secret pre-seed round last year.
This funding welcomed the participation of fintech giant Visa, Y Combinator, US-based VCs Global Founders Capital and Goodwater Capital, and UAE-based startup VentureSouq. Other investors include Angels Arash Ferdowsi, co-founder of Dropbox; Nicolas Kopp, former CEO of N26 in the US; soccer players Blaise Matuidi and Kieran Gibbs; and early collaborators at Revolut and Tide.
Visa’s investment was one of the incentives for Bloom’s participation in the global card system’s Fintech Fast Track program. A partnership was formed and as a result, Bloom – the first Sudanese startup to be admitted to the program – switched its cards from Mastercard to Visa.
“The Visa investment is critical to companies like us for a number of reasons. First, when you join Visa as an affiliate, you get a ton of benefits: product launch faster, marketing support, and product support; and two, in addition to the investment, Visa Fintech Fast Track enables you to access these incentives in a streamlined manner,” CEO and CEO Ahmed Ismail told londonbusinessblog.com in an interview.
In March, the company announced that it was part of this year’s winter batch of Y Combinator after its stealth launch that same month. Also, Bloom’s waiting list was made public in March, at which point the company had more than 15,000 people signed up; that number has surpassed 100,000, the founders told londonbusinessblog.com. They say the platform was launched in Sudan but declined to give specific numbers of customers actively using the product.
As highlighted and reiterated in the interview in March, Bloom’s founders say this seed round will help the Sudanese and Dubai-based startup execute its expansion plan in the Anglo-East African region such as Ethiopia, Kenya, Rwanda, Tanzania and Zambia. Some competitors in the region include YC-backed Fingo, Koa, and Finclusion.
“Our product is live in Sudan. The plan is to scale up in the country and then expand into other markets,” said Ismail. “We expect to be in at least one market before the end of the year and a few more early next year.”
Bloom’s seed round is the largest in Sudan, a country whose tech ecosystem can be called passive and only recently welcomed foreign investment when Fawry supported fintech and e-commerce player Alsoug after 30 years of international sanctions against the country.
East Africa, as a region, is home to 500 million people, with a median age of 18 and a burgeoning middle class. But the region’s currencies, including the Sudanese pound, are volatile, depreciating an average of 15% to 20% per year. This volatility is one of the biggest barriers to wealth protection and wealth creation for this middle class. That’s why Ismail and other co-founders Youcef Oudjidane, Khalid Keenan and Abdigani Diriye launched the fintech: to help Sudanese individuals to hedge against this rising devaluation.
Bloom offers users free accounts to save in dollars and buy and spend in Sudanese pounds. It also offers local and dollar cards and a feature that allows them to receive free money from various countries around the world, mainly where most of the Sudanese diaspora live. The fintech works together with the Export Development Bank, a partner bank that handles deposits. Bloom earns income from interest on these deposits, the exchange and other side streams.
Executives at Bloom and Visa say this investment and partnership could exponentially boost Visa card adoption in Sudan and East Africa. In addition, Visa’s range of products and services will provide customers with a secure and fast way to make online payments, according to Ahmed Mohey, Visa Country General Manager for Sudan and Libya.
“Visa is leading the way as the first mover in digital payments in Sudan. We are committed to being part of Sudan’s economic transformation by deploying our global expertise and capabilities with government and private sector partners. Together with Bloom, we will continue to drive the adoption of digital payments while finding opportunities to launch new products and services for Sudanese customers and merchants,” added Mohey.
Roel Janssen, partner at Global Founders Capital, shares the same feeling about the team: “We are very excited about our investment in Bloom. The experienced and talented founding team has the drive and expertise to build a product that is universally appreciated by consumers, partners and regulators in Sudan and the wider East Africa region.”