Moroccan start-up Chari completes funding round led by Saudi Arabia's Khwarizmi Ventures

Chari is a business-to-business e-commerce and FinTech company

Sophia Alj and Ismael Belkhayat, founders of start-up Chari. Photo: Chari
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Moroccan FinTech start-up Chari completed a bridge round of funding that values the company at $100 million.

The Casablanca-based company will use the fresh funds to enter new markets and expand its product portfolio. When a start-up needs additional capital between two rounds of funding, it goes through a bridge-financing round to keep the company afloat until the next, bigger financing round.

The undisclosed bridge round was led by the Saudi Arabia-based venture capital fund Khwarizmi Ventures, AirAngels (Airbnb Alumni Investors) and Afri Mobility, the venture capital arm of Moroccan conglomerate company Akwa Group.

“Chari will use the money of this bridge round to test the BNPL [buy now pay later] services with its existing customers,” Ismael Belkhayat, chief executive and cofounder of Chari, said.

“Upon successful results, Chari will acquire a local credit company to enable shop owners to lend money to their end users and further grow their business,” Mr Belkhayat said.

Employees of start-up Chari that aims to enter new markets in the coming months. Photo: Chari

Founded in January 2020, Chari is a business-to-business e-commerce and FinTech company that digitises the largely fragmented, fast-moving consumer goods sector in French-speaking African countries.

Traditional convenience stores in Morocco and Tunisia can order products and receive them in less than 24 hours by using Chari’s app, the company said.

FinTech is one of the most active sectors in finance, with start-ups attracting a significant amount of investments from both local and regional organisations. The continued growth of digital payments services presents a huge opportunity for more services in the market.

In the Middle East, one out of every four investment deals in 2021 was in FinTech, which accounted for about a third of all the funding raised — $2.1 billion in 220 deals — a report by consultancy firm RedSeer showed.

Chari, which recently graduated from the Y Combinator — an American technology start-up accelerator — raised $5m in October. It also acquired Karny.ma, a Moroccan ledger book that had more than 50,000 thousand active users.

This acquisition gave Chari valuable data on the loans given by grocery stores to their customers. It allows the start-up to credit-assess the unbanked shop owners and determine the most fitting payment terms given to each, the company said.

The company's existing investors include Y Combinator, Rocket Internet, Global Founders Capital, Plug and Play, Orange Ventures, Harvard University Management Company, Village Capital and P1 Ventures.

The founders are “visionary leaders that always make everyone around them think bigger every time they speak with them”, said Abdulaziz Al Turki, managing partner at Khwarizmi Ventures.

“We believe that under their leadership, Chari will help in improving the lives of millions in Africa through simplified financial solutions. We are proud of their mission and delighted to join their adventure,” Mr Al Turki added.

Chari, which is currently negotiating potential acquisitions with various companies to strengthen its offerings and customer base, intends to expand its operations in more francophone countries — nations that designate French as an official language or whose people primarily speak French.

“We will announce a geographic expansion in the coming days … and after that we are looking to raise a $30m Series A in the next months at a valuation between $150m and $200m,” Mr Belkhayat said.

“Chari is already cash flow positive as we have a negative working capital requirement,” he added.

Updated: January 21, 2022, 5:30 AM
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