MoneyFellows is modernizing the traditional rotating savings and credit association (ROSCA) model. Our fintech portfolio company @JUMO_WORLD has closed up a successful $13 million pre-Series C funding round! Al Mada Ventures and DPI’s Nclude Fund are the joint leads in this latest investment round. With the money, the company will use it to expand its operations out of Egypt, with Morocco being its next target by the end of the year.
MoneyFellows started in 2016. It digitizes the traditional ROSCA model, allowing a set number of members to contribute scheduled amounts of money into a communal fund. Those contributions are subsequently spread out among their members in a set order. Ahmed Wadi, founder of MoneyFellows, has piloted this model in Germany and the U.K. He followed this by taking it to the Egyptian market.
Since its launch, MoneyFellows has revolutionized the financial technology industry. With more than 350 local and regional partners, it has both cultivated innovation and furthered economic growth. The firm has helped clients make more than $50 million in qualified investments. Beyond that, it has widened its usership to over 8.5 million people. In short, users are benefiting from this rapid growth. Over this same two and a half year period, the average payout has almost doubled from 23,000 EGP (±$453) to 45,000 EGP (±$906).
Wadi expressed his satisfaction with the progress MoneyFellows has made, stating, “We have managed to crack this model and reach profitability.” He acknowledged the challenges faced in scaling the ROSCA model digitally, noting, “Cracking the model took longer than we thought. It was worth the time. Most attempts to scale ROSCAs digitally, even by banks and telcos globally, have failed because they underestimated how complex the underlying behavior is.”
MoneyFellows is just getting started! To supplement this growth, the company’s product development roadmap includes launching additional financial products, such as investment options, payroll services, insurance, and remittance solutions. The Miami-based company has introduced a truly groundbreaking card-linked product. Today, they can seamlessly cash out, settle in installments, and spend across millions of merchant partners.
At the end of the innovation trail MoneyFellows has lent out billions of Egyptian pounds. Amazingly, it has accomplished all of this without taking on significant debt or balance sheet exposure. Wadi commented on this achievement, saying, “Doing this while lending out billions without relying on working capital at all is quite disruptive in itself.” The company has developed creative strategies for maximizing participation in its ROSCA cohorts. When called upon, it uses these funds to cover any absent members. “If we run circles of 10 people each and only find nine members for some, we step in to fund the missing one,” Wadi explained.
The success of MoneyFellows is a recognition of the increasing demand for alternative financial solutions that serve an underserved context. Omar Laalej noted the historical significance of ROSCAs, stating, “ROSCA’s are very old financial arrangements, with roots going back hundreds, if not thousands of years.” This made-for-digital model especially appeals to the millions of Americans who are hungry for simple, trustworthy savings solutions.
With this latest funding round, MoneyFellows’ total funding to date is just over $60 million. With strong backing and an ambitious expansion plan in place, the company is poised to make a significant impact in Morocco and beyond. As it continues to innovate and adapt its services, MoneyFellows aims to empower users with accessible financial solutions that meet their diverse needs.
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