Esusu: Credit building startup co-founded by Nigerian immigrant becomes $1 billion firm in four years

Esusu, a financial technology company that uses data to bridge the racial wealth gap by reporting rent payments to credit bureaus, is now a unicorn, making it one of only a few Black-owned startups to reach a valuation of $1 billion. The company said Thursday it has raised $130 million in a Series B fundraising round.

SoftBank Vision Fund 2 led the funding round, with participation from Jones Feliciano Family Office, Lauder Zinterhofer Family Office, Schusterman Foundation, SoftBank Opportunity Fund, Related Companies and Wilshire Lane Capital, TechCrunch reported.

Co-founders of Esusu, Nigerian-born American Abbey Wemimo and Indian American Samir Goel, experienced financial exclusion growing up in immigrant homes. They said their families had no savings or credit, compelling them to rely on payday lenders that charged outrageous interest rates.

Each month, about 44 million households spend $1,100 on average on rent. However, more than 90% of renters find it difficult to build up their credit score by paying rent on time, and this hinders them from accessing quality financial products. It also limits their ability to qualify for a mortgage, Wemimo and Samir said.

They, therefore, founded their company in 2018 to help reverse the trend. Esusu reports on-time rent payments to major credit agencies to help renters improve scores and qualify for financial products. The New York-based company has partnered with some of the top property managers in the U.S., including WinnResidential, Mercy Housing, Goldman Sachs Asset Management and Related Companies in this regard. Over 2.5 million homes currently use Esusu’s service.

The company charges property managers and owners a $3,500 set-up fee and $2 per unit monthly while renters pay an annual subscription fee of $50 to report their rental payment data to credit agencies or bureaus.

“We founded Esusu with the vision of using data to bridge the racial wealth gap and create more equitable financial opportunities for low-to-moderate-income households in this country,” Wemimo and Goel said in a statement. “By establishing and improving credit scores, we are strengthening financial identities while empowering individuals, families, and communities to meet their long-term financial goals.”

Esusu plans to use the new capital it received to triple its number of employees and “turbocharge growth through product innovation.” The fintech now joins a small group of Black-led startups around the world that have hit unicorn status, including U.K.-based fintech Zepz, U.S. scheduling app Calendly and digital insurance startup Marshmallow. African startups Flutterwave and Chipper Cash have also reached unicorn status.

Esusu co-founder Wemimo, who is a Face2Face Africa YACE honoree, has a wealth of experience in marketing, consulting, project management, and market research. Before Esus, he founded Clean Water for Everyone (CWFE), an organization that provides access to clean and affordable water supply in developing nations by working with local people and organizations to achieve positive and measured social, economic, and environmental impacts. CWFE has provided access to clean water for more than 48,560 people in four countries.

Wemimo first came to America from Nigeria in 2009 with his family. According to The New York Times, his mother had no choice but to accept a loan with a 400% interest rate so she could settle the family and also pay for Wemimo’s college education. He told the New York Times that immigrants without credit histories are usually denied loans from traditional financial institutions. “You have to go into debt to get some sort of credit history going, which makes no sense to me,” he said.

After obtaining a degree in business management and public administration, Wemimo decided to create a scheme for immigrants like him and low to medium-income earners in America to save money and establish credit. That gave birth to Esusu. In 2020 when the pandemic was at its peak, his company distributed $250,000 in interest-free loans to New Yorkers who couldn’t make their rent.