South African startup FlexClub, which links drivers and investors to cars for ride-hailing services, closed a $1.2million investment in a seed round led by CRE Venture Capital. Nairobi based Savannah Fund and South African angel investor, Michael Jordan joined CRE in the $1.2 million round. The company intends to use the finance to add team members and expand off the continent through a partnership with Uber Mexico.
FlexClub was co-founded November last year by Tinashe Ruzane and Marlon Gallardo, both former employees of Uber and Rudolf Vavruch. FlexClub is a “gig economy investment platform” that is creating new asset classes in emerging markets, according to co-founder, Tinashe Ruzane.
“Our goal is to make this completely passive, where investors can invest in different kinds of assets on our platform, login to a dash, and see this is how my five cars in South Africa are doing, my vans in Mexico, my motorbikes in Indonesia; with a diversified portfolio around the world,” he explained.
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FlexClub allows users to purchase vehicles which are matched with Uber drivers who pay a weekly rental that generates monthly, fixed-rate interest income for investors. The driver has the option of buying the car after the 12 months, with a descending purchase price over time. It manages the investment, rental income, and disbursement of funds across all parties. The startup also handles insurance, maintenance and upkeep of the vehicles. It generates revenue by charging a percentage of the rental income to investor club members.
Michael Jordan, CEO of Montegray Capital, said he was attracted to FlexClub by the concept of helping people without capital to become Uber drivers who can buy the car over time. “It is a company with possibilities in all markets where Uber operates and may also expand into other asset classes over time,” he said.
The company currently operates in South Africa with $3 million worth assets and has relationships with several car dealers. It will begin operations in Mexico by April.
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