Leading insurance tech firm Pula last week said it has raised $6 million in a Series-A funding round led by TLcom Capital and Women’s World Banking. According to the company, the new investment will be used to fund its expansion into Asia while scaling up operations across 13 African markets where it currently operates.
The Nairobi-based microinsurance firm, which services businessmen in the agricultural sector, is known across the continent for mitigating financial risks for smallholder farmers.
As of December 2020, the company’s operations had impacted up to 4.3 million farmers on the continent and it was named the best insurtech company in Africa in December. Pula’s activities have also attracted global attention including being the subject of a 2019 profile by the New York Times and a TED Talk.
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The funding is the latest milestone for the six-year-old startup, which has an extensive clientele that includes the Central Bank of Nigeria, the Zambian and Kenyan governments as well as the World Food Programme. It currently has 50 insurance partners and six reinsurance partners.
“When Thomas and I launched Pula in 2015, we had one goal in mind – to build and deliver scalable insurance solutions for Africa’s 700 million smallholder farmers and with our latest funding, now is the time to break into new ground,” Co-Founder and Co-CEO, Rose Goslinga said.
Pula is “addressing a hugely underserved market in one of Africa’s key drivers of growth,” said Maurizio Caio, Managing Partner and Founder of TLcom Capital. “With this, (there is) an opportunity for major economic upside. The potential for the insurance market for smallholder farmers in Africa is huge.”
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While insurance in Kenya dates as far back as 1930, it was not until 2015 that the country’s first set of insurtech startups began to appear. In spite of the slow take-off, however, there’s has been real growth in innovative insurance solutions offered by a number of platforms such as Bluewave Insurance, WazInsure, Kakbima, and Pula.
Despite the impressive success Pula has achieved since its launch, Rose added that there are still “millions of smallholder farmers with risks to their livelihoods that have not been covered” across Africa and other emerging markets. “In the midst of a global pandemic, farmers need assurances now more than ever and with this in mind, it’s time to scale up,” she said.
As the TLcom founder notes, the potential for the largely-undertapped agriculture insurance market is huge, especially in Kenya.
In the East Africa nation’s economy, agriculture is big business. The sector contributes around 30% to gross domestic product and six out of 10 citizens depend on farming, livestock, and fisheries, according to the World Bank, offering immense potential for companies offering agricultural coverage.
