Jetstream Africa says it will use its technology, networks and systems to help African companies finance transactions without having to obtain letters of credit (L/Cs) from conventional lenders.

The Ghana-based digital logistics startup has also announced this month that it has secured US$13 million in equity and debt pre-Series A financing.

L/C alternative

Jetstream's L/C alternative essentially provides traders with working capital backed by the actual shipment.

Rather than handling the L/C itself, Jetstream underwrites loans with a tenor of 15-90 days through its banking partners and disburses the loan proceeds to every vendor in the supply chain.

Development agency backing

The Ghanaian startup secured significant development agency support in its US$13 million financing.

Debt funding was provided by fintech lender and private equity investor Cauris, whose investors include the African Development Bank and the EU's European Investment Bank as well as impact investors and development agencies owned by governments in several countries, including the Netherlands, UK and Belgium.

French development institution Proparco also provided debt financing through its bridge fund, which it established as an acceleration and growth tool for start-ups and a solution in response to the increased financing difficulties related to the Covid-19 crisis.

Participating investors

Equity investors in the latest financing round include Octerra, Wuri Ventures, Seed9, The MBA Fund and ASCVC, a venture fund founded by executives of the multinational supply chain visibility platform Project44.

Existing investors Alitheia IDF and Golden Palm also participated in the financing.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.