SA’s FlexClub Secures $1.2M Investment Led by CRE Venture Capital

FlexClub, a South African startup that matches investors and drivers to cars for ride-hailing services, closed a $1.2 million seed round led by CRE Venture Capital. Nairobi based Savannah Fund and South African angel investor Michael Jordaan joined lead investor CRE in the $1.2 million round. Techcrunch reports that the company will use the financing to add team members and expand off the continent through a partnership with Uber  Mexico. FlexClub touts itself as a “gig economy investment platform” that is creating new asset classes in emerging markets, according to the chief executive and co-founder Tinashe Ruzane. FlexClub allows investors to go on the site and purchase a car (ultimately managed and serviced by FlexClub). The startup then connects that car to an Uber driver who uses earnings to pay a weekly rental charge. Those fees generate monthly, fixed-rate interest income for the investor. The driver has the option of buying the car after the 12 months, with a descending purchase price over time. “We think there’s a transformation of urban mobility in frontier markets…from Uber to scooters to motorbike markets,” says CRE Venture Capital partner Pardon Makumbe. “There’s also a massive young international employee population that is ready to work for Uber or other fulfilment and logistics companies…but the price point to own the producing asset, i.e., a car, can be prohibitive,” he said.