Cowrywise, a Nigerian-based wealth management platform, has successfully raised $3 million in a pre-Series A funding round. The round was primarily led by Quona Capital, with additional participation from Tsadik Foundation, Sahil Lavingia, and a group of Nigerian angel investors.
Founded in 2017 by Edward Popoola and Razaq Ahmed, Cowrywise initially launched with a savings feature and has since expanded its offerings to include diverse investment options. The platform addresses a growing need for capital preservation and wealth building, particularly as Nigeria’s economy faces challenges. Many traditional wealth management firms tend to cater only to high-net-worth individuals, leaving a substantial portion of the market, primarily small and medium earners, underserved. This gap has opened up opportunities for digital wealth managers who can demonstrate how small investments can accumulate over time.
Cowrywise has set itself apart by focusing on mutual funds rather than just savings. The app now has 220,000 registered users and aims to reach 10 million by 2025, targeting a fraction of Nigeria’s 20 million bank account holders who remain largely under-served in terms of investment and financial services.
Growth of Mutual Funds
Unlike other wealth management platforms in Nigeria that started by offering better savings rates than banks, Cowrywise has emphasized mutual funds—pooled investments in stocks, bonds, and money market instruments. This strategy has resonated well with Nigerian users, enabling them to start investing with as little as N1,000 ($2.62), a significant departure from the larger investment sums typically required by traditional wealth managers.
The company has also made strides in making these investment options more accessible, emphasizing transparency and ease of use. Through its platform, users can quickly view their investments, making the entire process seamless and straightforward.
API Integration and Scaling
In a bid to scale its operations and offer a wider range of investment choices, Cowrywise is integrating API solutions that allow traditional wealth managers to access its platform. This move will create a marketplace where users can effortlessly switch between various mutual funds without leaving the app, providing a smoother, more diversified investment experience.
As the Securities and Exchange Commission (SEC) in Nigeria tightens regulations to weed out fraudulent schemes, Cowrywise’s transparency and accessible investment tools could prove invaluable in helping users avoid scams like the infamous MBA Forex.
Quona Capital’s Investment Strategy
Quona Capital, which led this funding round, sees great potential in Cowrywise’s model of accessible wealth management. The firm believes that Cowrywise’s innovative approach can help build long-term financial resilience for Nigerians. Johan Bosini, partner at Quona Capital, shared, “We are excited to support this team and make our first investment in Nigeria, as Cowrywise’s platform has the potential to positively impact the financial future of many Nigerians.”
