African mobility startups may start to prepare themselves ahead of 2021 as leading Japanese vehicle manufacturer, Toyota is set to pour over $45 million in African startups next year. With its Mobility 54 investment fund, Toyota not only wants to play a key role in the development of mobility in Africa, but also to boost its vehicle sales there.
Here Is What You Need To Know
- Toyota plans to invest $ 45 million in transportation and asset finance startups in Africa in 2021, Takeshi Watanabe, CEO of Mobility 54, the investment fund launched by the Japanese automaker in August, 2019.
- The fund targets African startups equipped with innovative mobility services and technologies.
- It also plans to support the expansion of these companies.
- These investments will be of the same type as the one made recently in Uganda, where Toyota invested $4 million in Tugende, a startup active since 2010 and specializing in leasing to very small urban transport companies, including motorcycle taxis and minibus-taxi.
- In November 2019, the Ugandan startup established itself in western Kenya with the intention of duplicating its presence in several other regions of the country and Africa in general.
“We see huge for Tugende’s business in the taxi market,” potential commented Takeshi Watanabe.
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A Look At Mobility 54 Investment Fund
Mobility 54 invests in startups with innovative mobility services and technology in Africa and support their business expansion. In addition, Mobility 54 will be a “value-up” investment company leveraging the Toyota Tsusho/ CFAO group’s Pan-Africa automotive network leading to generating synergies among the startups and Toyota Tsusho/CFAO group’s businesses in Africa.
Mobility 54 is Toyota’s strategic weapon to boost its vehicle sales in Africa. When its investment fund finances a transportation and asset financing startup, it offers Toyota products, whether its motorcycles or any other vehicle. The financing activity of very small transport companies such as Tugende conceals a level of manageable risk according to the startup, which only issues the title on the vehicles once the credit has been fully repaid by the entrepreneurs. Loans deemed too risky are subject to the same conditions as bank loans. By paying a weekly draft 15% higher than what these small contractors pay to rent their vehicles, these contractors become owners after 24 months on average, according to explanations to the local press by Michael Wilkerson , CEO of Tugende.
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