Cowrywise, a Nigerian fintech startup offering digital wealth management and financial planning solutions, raised $ 3 million in pre-Series A funding. Quona Capital led the round as Tsadik Foundation, Gumroad CEO Sahil Lavingia, and a syndicate of Nigerian angelic investors participated locally and in the diaspora. The company it previously raised more than $ 500,000 through a combination of equity financing and grants.
Cowrywise’s idea was born when the CEO Razaq Ahmed was an investment analyst at Meristem, covering stocks and providing recommendations to retail and wealth management clients. He noted that existing investment management firms in the country have focused on the top 1%. They could not scale investment products to millions of Nigerians mainly due to their limiting size.
Banks, though, have been able to make progress on this front when compared to investment firms. They expanded heavily in the mid and late 2000s to accumulate the branch networks they have today where there are about 45 million unique accounts in Nigeria. But over the years, the quality of banking services in terms of savings and investment has drastically reduced. With interest rates hovering around 3-5% annually, what Nigerians now know is sending and receiving money through their bank accounts and using debit cards for withdrawals leaving the market still underserved when deals with investment products.
For this Ahmed, alongside Edward Popoola as a CTO, founded Cowrywise in 2017 to solve this problem. With Cowrywise, they hoped to democratize access to savings and investment products to the growing demographics of disadvantaged Nigerian millennials and the middle class.
“Wealth management had been strange to many Nigerians because the existing players weren’t created for the mass market. This has always been an issue that we have found a solution to be needed, ”Ahmed told ProWellTech.
