Bolt secures about €600 million in Series E funding to accelerate growth across Africa and Europe

Estonian-based ride-hailing company, Bolt, announced this week that it has secured over €600 million in a Series E funding round led by Sequoia Capital, with participation from Tekne and Ghisallo, G Squared, D1 Capital, and Naya. With this new funding, the company has hit a total valuation of more than €4bn, with plans of utilizing this in branching into the grocery delivery market, as well as increasing its foothold on the African and Asian markets. It is looking at launching its 15-minute grocery delivery product offering, Bolt Market that will be available in countries in the Baltics and Central Europe as well as Sweden, Portugal, Croatia, and Romania in the next few months.

The funds will also be employed in deepening its foothold in ride-hailing services and micro-mobility across Africa and Europe. These will increase safety measures and features for drivers and riders on the platform, facilitate easier vehicle ownership initiatives, driver and courier empowerment, and other sustainable initiatives. As Kenneth Micah, East Africa Regional Manager for Bolt is quoted as saying, on Silicon Republic:

“We continue to invest in products and services that improve the lives of our customers across the globe. We also continue to proactively add more shared and electric vehicles to our platform. We believe that the future of urban transport is a network of on-demand services including ride-hailing, food, and grocery delivery. We are focused on creating innovative, quality, affordable and reliable services that will enhance urban mobility and provide viable economic opportunities across Eastern Africa.”

Kenneth Micah, East Africa Regional Manager for Bolt (Capital FM, 2019).

The company made inroads into the Nigerian space in 2016 when it was known as Taxify. Within the span of 5 years, the company has been able to grow to a market leader position, with a geographical spread across 29 cities in Nigeria, and the largest pool of drivers on the platform. Because of its relative affordability to its rival in the space, Uber, Nigerians have grown a preference for using the popular ride-hailing app. Mr. Femi Akin-Laguda, Bolt Country Manager for Nigeria, in an interview with NIPC media, spoke of their consistency in driving a data-led strategy:

It’s been an amazing ride, one of the stories that we should be speaking more about because when we arrived in the country in 2016, there were other players and platforms in the market.  Many joined about the same time, but fast forward 4 years plus, we are now the leading player…the core of our story is people. The amazing team we have been able to put together in Nigeria has been the core of the success that we have had. Our team is one of the best I have worked with – a group of young people who are focused, hungry, passionate, and smart.

During the height of the COVID pandemic and lockdown across cities in Nigeria, the company lost about 95-98% of its business mileage, which was a daunting challenge with staying above board. However, they ensured that their employee strength was maintained through that period, and now the business is getting back on track. Speaking on how the firm navigated during the difficult period of the COVID outbreak and eventual lockdown in 2020, Mr. Akin-Laguda stated that they lost 95 – 98 % of their business during the height of the lockdown. It was challenging to keep all active staff on board, yet they ensured that no one’s job was laid-off. With the launch of its vehicle financing programme in June of this year that will allow drivers to own their cars with low equity repayment, the company is increasing the value it is offering to its drivers.

In August 2020, the Lagos State Government released a document detailing a list of major requirements on ride-hailing regulation for companies like Bolt and Uber in the country. This was a follow-up of the early shakedown in February and March 2020 of these ride-hailing companies by the Lagos State Government, pressing the need for regulation, to curtail security and safety challenges in the state. Some of the requirements that emerged are:

  • A provisional operational licence to be obtained with N8 million for companies with less than 1,000 vehicles and N20 million for companies with more than 1,000 vehicles (Revised).
  • Licence to be renewed annually with N5 million for companies with less than 1,000 vehicles and N10 million for companies with more than 1,000.
  • Companies must pay N20 of all commissions they receive to the government as Road Improvement Fund.
  • The annual licence renewal process must be commenced 3 months before the expiration of the old one.
  • Provision of a comprehensive insurance package for drivers and passengers.

In spite of these challenges, the company has been able to grow and consolidate its market share in the business, while keeping its relevance in the mind of its customers. With this new funding, its impact and spread across Africa would increase, strengthening its stronghold on the African market space. As Mr. Akin-Laguda concludes:

Since we launched in Nigeria, we have invested more than €50 million in the country into everything from campaigns to technology and our people. And we have only scratched the surface of what the ride-hailing sector will be in Nigeria. So, there is still a long path for us. We do have confidence that in the next 5 to 10 years when the market becomes a lot more mature, the revenue will be there to set a solid return on investment. Still, every company I know in the market that is successful is focused on growth and not returns on investment yet.

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