SEC-Licensed digital broker and leading digital investment platform Chaka Technologies raised $1.5m in a pre-seed funding round led by Breyer Capital, global venture capital firm focused on tech companies like Spotify and Facebook.
Other participants in the round are 4DX Ventures, Golden Palm Investments, Future Africa, Seedstars and Musha Ventures.
This funding will enable Chaka to continue to enable borderless investments across Africa and deliver digital investments solutions for African businesses. It will also be used towards the expansion of the FinTech’s footprints across West Africa to reach more retail investors and attract more foreign players to African capital markets.
Commenting on the funding, Chaka CEO Tosin Osibodu said, “This is indeed a significant milestone for us at Chaka. We see digital investments as an opportunity to boost economic transformation in Africa, and our goal is to use this funding to bring this vision to life. With this capital, we will focus on our goals to build a roster of formidable partners and accelerate our expansion to other markets within Africa. This investment also enables us to hire top talent and integrate more advanced functionalities into our investment and wealth management solutions for businesses.
“Our mission remains the same and we are excited to be backed by VCs like Breyer Capital that trust us and are extremely optimistic of the possibilities that exist for Chaka and Africa.”
Echoing a similar sentiment, Breyer Capital CEO Jim Breyer added, “We are proud to combine efforts with a company that is levelling the investment playing field for Nigerians (and Africans at large). We’re confident in the value Chaka provides through its digital tools, and we look forward to playing our part in supporting Chaka’s team on their mission to drive borderless investments in Africa.”
This pre-seed round comes on the heels of the Chaka becoming the first startup to acquire the new digital sub-broker license issued by Nigeria’s Securities and Exchange Commission (SEC), in line with the regulator’s efforts to safeguard the investing public and accelerate innovation within the sector.
Since Chaka’s launch in 2019, the platform has levelled the barriers of entry for borderless investments in Nigeria by providing customers with compliant access to the capital market. Chaka’s suite of products includes a stock trading app for retail investors, Chaka SDK which enables asset managers and financial institutions to offer digital investments to their customers, and Chaka for Business which enables direct business onboarding and provides powerful trading tools for institutional investors.
In April this year, digital investment platforms were caught in crosshairs with Nigeria’s SEC. The regulator declared their activities illegal and warned capital market operators working with them to renege on providing brokerage services for foreign securities. Unlike Robinhood which offers online brokerages, Nigerian investment platforms do not. Chaka partners with Citi Investment Capital in Nigeria and DriveWealth LLC in the US to issue stocks and securities.
Nigeria’s SEC wanted to bring the activities of these platforms under its purview as part of its efforts to safeguard the investing public. Last December the regulator singled out the two-year-old company for “selling and advertising stocks.” The event set the precedence for the regulator’s all-out attack on other digital investment platforms, giving Chaka enough time to engage and conclude talks in about half a year.
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