Nigerian fintech company, Kuda, announced Monday it has closed a $55 million Series B funding co-led by Valar ventures and Target Global at a valuation of $500 million.

Founded in 2019 by Babs Ogundeyi and Musty Mustapha, Kuda is a microfinance bank licensed by Central bank of Nigeria.

The funding comes on the back of some outstanding early growth for the startup.

Kuda raised $25 million in March, led by Valar Ventures, the firm co-founder and backed by Peter Thiel with Target Global and other investors.

The bank said the funds raised through its London entity will be used to expand its Nigerian operations and to prepare for its launch in other African countries.

Kuda now has 1.4 million registered users, a 124 per cent growth from 650,000 registered users, a figure it revealed when announcing its Series A of $25 million led by Valar Ventures, according to Techcrunch.

“We’ve been doing a lot of resource deployment has been in our operational entity, in Nigeria. But now we are doubling down on the expansion and the idea is to build a strong team for the expansion plans for Kuda,” Ogundeyi was quoted by TechCrunch as saying.

“We still see Nigeria as an important market and don’t want to be distracted so don’t want to disrupt those operations too much. It’s a strong market and competitive. It’s one that we feel we need to have a stronghold on. So this funding is to invest in expansion and have more experience in the company with relation to expansion.”

Ricardo Schäfer, the partner at Target who led the round for the firm said, “We felt that Babs and Musty (Mustapha, the co-founder and CTO) are ambitious on another level. For them, it was always about building a pan-African bank, not just a Nigerian leader.”

“The prospect of banking over 1 billion people from day one really stood out for me at the beginning,” he said.

“Kuda is our first investment in Africa and our initial confidence in the team has been upheld by its rapid growth in the past four months,” he said.

“With a youthful population eager to adopt digital financial services in the region, we believe that Kuda’s transformative effect on banking will scale across Africa and we’re proud to continue supporting them,” Andrew McCormack, a general partner at Valar Ventures who co-founded the firm with Peter Thiel and James Fitzgerald, said.

PT