(Bloomberg) -- Metro Africa Xpress Inc., -a Nigerian vehicle subscription startup, plans to raise $100 million to deploy electric vehicles in 10 African countries as demand for cheap, low-emissions transport increases.
The company, backed by private-equity firm Lightrock LLP, expects to raise the funds by “the end of 2023,” enabling it to operate in countries including Cameroon, Uganda and Egypt, David Hoyme, director of international expansion, said in an interview. The firm currently has operations in Nigeria and Ghana.
The cost of owning EVs is cheaper than vehicles that use internal combustion engines. In Kenya, it costs 67% less, according to McKinsey & Co. Still, in a continent that largely depends on second-hand vehicles and suffers chronic power shortages, building an electric vehicle ecosystem may be challenging.
Max, as the company is known, raised $31 million last year. Hoyme, who previously worked at Goldman Sachs Group Inc. and Eventide Asset Management, plans to take advantage of his experience in negotiating partnerships to grow the company, he said.
Founded in 2015, the firm has a vehicle fleet -- mainly three-wheeler rickshaws and sedans -- of 9,000, of which just about 5% are electric. It plans to grow the proportion of electric vehicles to 70% by 2026, Hoyme said.
The Nigerian startup has partnerships with vehicle producers such as Yamaha Corp. and ride-hailing platform Bolt Technology OU as well as lenders. It is exploring further agreements that will help increase the supply of EV components including batteries to ease the adoption and expansion of the transport model on the continent, Hoyme said.
(Corrects description of startup in headline and lead)
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