Kenyan Startup Flowt Raises Pre-Seed Funding for Climate Smart Lending
Kenyan Startup Flowt Raises Pre-Seed Funding for Climate Smart Lending
Kenyan startup Flowt has closed an undisclosed pre-seed funding round to expand its AI-driven financial intelligence platform and provide working capital to climate-smart businesses in Africa. Founded by Elana Laichena, the Nairobi-based startup uses AI to analyse financial records and turn them into data that lenders can use to assess small businesses. The round was backed by Delta40 Fund I, Impacc and Argidius Foundation. Flowt has already deployed its first financing facility to GreenBay, a Kenyan circular commerce business that refurbishes and resells pre-owned and second-life appliances, including solar equipment. GreenBay's growth had been constrained by the amount of inventory it could afford to hold, making access to working capital a key requirement for expansion.
Flowt Uses Business Data to Assess Lending Risk
Rather than relying primarily on collateral or lengthy due diligence, Flowt assesses a business using the financial information it already generates. For GreenBay, the startup integrated with its Odoo accounting system and used AI and machine-learning analysis of bank statements to assess its financial position, cash movements and repayment capacity. Flowt says the process allowed the assessment to be completed within days rather than the months that can be required for traditional small-business lending.
“Funders in Africa have three bad options when they look at a small business,” said Laichena. She said lenders often require collateral, spend months on due diligence or charge interest rates that small businesses cannot afford. Flowt instead uses verified transaction history to assess working-capital needs and repayment capacity.
GreenBay Uses Financing to Increase Inventory
GreenBay sources, tests, refurbishes and resells pre-owned and second-life equipment to households and small businesses. Its ability to increase sales is closely linked to how much inventory it can hold, making working capital an important constraint on growth.
The company has used Flowt's financing to purchase and sell more inventory and has started making repayments through its Flowt wallet. A separate account is used for purchasing and collections, keeping that cash apart from operating expenses. Flowt says this structure gives lenders greater visibility into the business's cash movements while helping manage lending risk.
The new funding will support Flowt's expansion across Kenya and further development of its financial intelligence platform. The startup is targeting smaller climate-smart businesses that can face difficulty accessing traditional financing because lenders have limited visibility into their financial performance.
