Herconomy becomes a fintech startup to empower more women

Herconomy’s pre-seed raise is one for the history books. Last year, the startup shocked the tech ecosystem with its funding story. Within 24 hours of an Instagram post by founder Ife Durosimi-Etti, the community-based startup raised $600,000 in funding to scale its SaaS product that gave women continued access to career opportunities and discounts from select brands. Now Herconomy is taking another big step: pivoting to a fintech company and discontinuing its previous product and model.

Change is no stranger to Durosimi-Etti, Herconomy’s founder. Over the past three years, she transitioned from corporate communications at Nigerian breweries to running a furniture business before putting her work gloves where her heart is – a startup that helps women thrive. Herconomy’s previous product achieved some significant feats, including bringing together a vibrant community of women and offering them access to jobs, opportunities and capacity-building workshops. The business model relied on customers paying to access these benefits.

However, Durosimi-Etti’s dreams for the startup go beyond connecting women to opportunities. She has always wanted Herconomy to become a catalyst for the socio-economic independence of women by actively helping them grow their wealth, manage their finances and access capital for their businesses.

In Nigeria, only 33% of women have bank accounts, resulting in women being excluded from the world of digital services and opportunities for value creation. Banking the unbanked is a huge challenge, but Durosimi-Etti believes Herconomy has what it takes to tackle it. Community-turned-fintech Herconomy has made its first move by launching a mobile savings app that allows women to save and earn up to 10% annual interest on their savings.

Herconomy’s slogan is “save, earn, learn, connect and thrive”. The company believes that saving is women’s first step towards economic growth and asset management. This belief in the life-changing power of a savings culture may have come from the feedback and success of several savings challenges that the community ran internally over the years. Prior to the launch of this app, at least 500 women participated in Herconomy’s savings challenges and saved well over $100,000 in total. The app was tested in April 2022 and already has around 5,000 active savers on it, according to Herconomy

Lasisi, Herconomy’s CTO, spoke about the purpose and impact of the pivot at a media conference that TechCabal was invited to: “Our mission is to empower women in Nigeria and beyond to be financially independent, thereby contributing to socio-economic development. of their ecosystem. This is in line with our vision to empower one million women by the year 2025.” To fulfill this vision, Herconomy has launched the Every Woman Bring One Campaign, which financially incentivizes women through Herconomy’s referral program, as well as their own savings progress, to encourage at least one person in their circle to start saving with the mobile app.

This new savings app is an important part of Herconomy’s ambitious goals. The savings product has two main savings plans: Vault and Float, which accrue 10% and 8% annual interest respectively. There’s also an Accountability Partner feature where friends can check in on each other as they save towards a goal. The app also has a Save as You Spend feature with which users can place orders and get approximately 30% off selected goods and services.

Despite this pivot point for fintech, Herconomy is not leaving out its extensive community play. Unlike most fintech products, Herconomy will include users of its savings app in the activities of its 6,000-member community. Users will receive push notifications about networking events, knowledge sharing events and business growth opportunities that can improve their earning potential and increase their savings. They will also have access to Herconomy’s weekly e-meetings, where experts are invited to discuss various issues affecting women, ranging from financial literacy to reproductive health. Thus, Herconomy will remain society-driven and women-focused. Although men are not excluded from these activities or from using the savings app, the startup will make decisions and measure the impact with women in mind.

Durosimi-Etti talked about the challenges the company faced while building this product, highlighting the issue of finding talent. As thousands of Nigerian talents took up external jobs or migrated to the diaspora for work, finding the right talent turned out to be a project alone. However, she has managed to build a team of 31 people, over 50% of whom are women. The company is proud of how the gender parity of its workforce reflects the world that Herconomy strives for – a world where women are given the same opportunities as men.

Herconomy currently operates in partnership with Providus Bank, with the customers’ funds secured and insured by AXA Mansard insurance company. In the coming months, Herconomy plans to push beyond its cooperative license to secure a microfinance banking (MFB) license, which will enable it to operate its core financial inclusion plan.

As an MFB, Herconomy plans to bring unbanked women (those without bank verification numbers) on board by opening tier 1 accounts for them and helping them access all the benefits of the Herconomy app, through a robust agent network. Offering credit to customers is also one of the company’s most important ambitions, and according to the company’s assistant product manager, Opral Ogbuigwe, Herconomy will launch its credit offers in 2023.

With this venture, Herconomy is banking on women and proving that even in Nigeria’s most saturated tech market, startups with social capital can stand out and make an impact with their disruptive technologies.