Tugende, a lease-to-own Ugandan startup, has received a $5 million loan from the Overseas Private Investment Corporation (OPIC).
“The Overseas Private Investment Corporation (OPIC) has provided a $5 million loan to Tugende Limited,” OPIC wrote in their press release.
According to the document which lays out the details of the loan, the proposed loan amount is $5,000,000 Million. However, the project costs are $6,667,000 and the loan period will last 5 years.
This will be used for scaling both within Uganda and the East African region.
“The business, which has grown with no advertising, will use the OPIC loan to scale up its successful operations in Uganda,” wrote OPIC.
When you look at the details [PDF], it seems OPIC is offering the loan with the promise from the startup that they will take on more US labor, however small.
“U.S. procurement associated with this Project is expected to have a small but positive impact on U.S. employment,” one of the reviews read.
Perhaps that’s why the companies that secure similar forms of investment maintain offices in the US or go on to have much of their staff to be foreigners. For example M-Kopa, Fenix International and Tala.
The document also lists Michael Wilkerson, the founder of Tugende, as the US sponsor – which in the startup language could mean the founder or shareholder.
While it also lists Ugandan journalist and owner of the Independent, a Ugandan media house – Andrew Mwenda as the foreign investor.
Tugende, on its website, lists Andrew Mwenda as the only black board member together with Matt Brown, Aaron Patillo and David Isroff.
“He was the first investor in Tugende, a current board member and has provided extensive mentorship, connections and help to navigate Uganda’s bureaucracy,” part of Andrew’s bio on Tugende reads.
Founded in 2013, the startup operates a lease-to-own model in which riders are given a boda-boda loan which they pay off with an interest.
After clearing the loan, the ownership of the boda-boda is transferred to them. The loan term is usually over a period of 18 months.
The company says that it currently has at least 150 employees and has served over 12,000 customers.