Rent to Own (RTO); a Zambia-based company that can be considered as one of the first movers in asset financing locally has raised equity investment of USD 1.05 Mn in a seed round led by AHL Venture Partners.
Having significantly increased their investment in the company, the lead investors in the seed round are also joined by two other firms Small Foundation and Jordan Engineering (through Serenity Investments).
RTO is known to offer high-value machinery to small-scale entrepreneurs and smallholder farmers in various parts of rural Zambia. The company serves up an “all-in-one” package which features uncollateralized financing, equipment training, delivery, and installation.
By so doing, RTO supports its clients’ enterprises with a view to growing their respective businesses and improving their quality of life. Through its flexible, tech-driven platform, the company brings novel technologies to ordinarily neglected and/or underserved markets so as to enable rapid adoption of innovative assets. Solar-powered irrigation pumps are one of such assets with which RTO has made a headway since coming into existence in 2010.
“The closing of this seed round marks a milestone for Rent to Own in its journey to one million customers. We are excited to have the backing of strong investors like AHL, Small Foundation, and Jordan Engineering (via Serenity Investments), and the continued support of Shell Foundation and others,” said Jeffrey Scheidegger, RTO’s CEO, with respect to the development.
As offered by Rosanne Whalley, Partner at AHL Venture Partners; “We’re excited to participate in this latest funding round, as we think Rent to Own has developed a viable and scalable business model, to serve the rural base of the pyramid consumer – one of the toughest segments of the market to serve.”
According to a statement released by the company, over 7,000 productive-use assets have been delivered by RTO over the course of its eight-year existence. More so, the company has also posted an impressive 96 percent repayment rate since its establishment.
The statement also suggests that the company recorded its first operationally break-even months in Q3 and Q4 of 2018 while hinting at RTO’s readiness to scale in Zambia and beyond. Also, more investments are to be expected as a Series-A investment in the first quarter of next year is believed to be on the cards.
“Access to the right equipment is a real solution to unlocking the great potential of entrepreneurs in rural, underserved markets, we’re excited to work with our customers, agents, investors, and suppliers to reach one million customers,” added Scheidegger.