Over the past 8 months, SafeBoda has undergone a serious facelift. But, if you follow startups, no one undergoes such changes without having a comfortable buffer of cash to burn.
That is why that made me curious and decided to find out if the boda-hailing company had raised some external funding that it never made public. It turned out that company had raised $1.1 Million in January 2018.
This is according to two people who said were familiar with the investment details. Though they declined to reveal the details of who invested considering they only spoke to me on conditions of anonymity.
Last week, I paid a visit to SafeBoda’s offices on Bukoto Street and met Maxime Dieudonné - a co-founder and co-CEO. I let him know that I was writing an article about their round of funding, he didn’t seem surprised.
We talked briefly and he told me that they’ve been able to attract some “world class” investors to Uganda.
But, he didn’t want our conversation recorded and preferred that I send him questions for an email interview in order for him to clarify the issue. Though, this week, he told me that he wouldn't comment on the issue any further.
“Hi Peter, sorry for slow reply - the thing is that I will need to respond most of your questions by "no comments",” Maxime wrote to me. Adding that "we are a private company and do not disclose most [of] the information you are asking.”
Perhaps they discussed it internally and decided not to go public with the information or keep everyone continuing to guess.
He also added that the $1.1 Million figure is wrong, but declined to reveal what the actual amount is. "The financial information you are disclosing in the article is incorrect - but as I said I won't further comment," Maxime wrote.
There’s no doubt SafeBoda raised funding as I trust the people I spoke to. Plus, Maxime promised to “write a few lines about the fundraising journey” and how they managed to “bring world-class investors to Uganda.”
More activities that support the assertion is the trend SafeBoda has been on lately. Here is how 2018 has been for the boda-hailing company so far;
SafeBoda announced its plans to expand to Kenya early in this year and started setting up the office. The expansion was finalized a few weeks ago when the boda-hailing company’s other co-CEO, Alastair Sussock, announced that they were live in Nairobi.
According to Sautitech, the company is also pondering expanding to Nigeria.
Beyond the expansion, the company also added another office in March this year. Before, the company was based in Kyebando, a more out of the CBD suburb of Kampala.
Yet, the newly added office is in Kisementi - a more prime location of Kampala. Just a few metres away from Andela’s office. The office could be costing the company at least $5,000 per month.
Currently, SafeBoda is discounting all rides taken at 50% for cash payments and 70% for credit. This implies that if you take a ride worth UGX 10,000, you pay UGx. 5,000 with cash and UGx. 3,000 with credit. SafeBoda pays the rest for you and the offer has been running for now over 3 months.
This makes it as affordable as Taxify and almost matches the cost of taking the regular taxis (Matatus). But, it is a heavy Cost of Acquisition of Customers that one ought to have raised a significant amount of funding to even consider undertaking.
Additionally, the company has rapidly scaled its number of riders. Although SafeBoda is not open about the correct number of riders, my estimate is that they entered 2018 with between 1000 to 1500 riders. Yet, last night, I took a SafeBoda numbered 5068. This implies the company has scaled this number at least 2.5x.
Though this scaling hasn’t come without backlash from their customers as most are now half-baked. The company was faced with public outlash the past few weeks that they were compelled to issue an apology.
We apologise for the recent inconsistent customer experience. Our growing quality team is working tirelessly to test and retrain SafeBodas in customer care and app use to ensure a good quality service, every time. pic.twitter.com/jTmb2bNXUL
— SafeBoda (@SafeBoda) August 1, 2018
When you put all the above into perspective plus the reputation of the people I spoke to, I was compelled to make the conclusion. Even though Maxime later insisted that "the figure is incorrect".