Philippine fintech startup PawnHero, an online pawn shop in Southeast Asia, has secured an undisclosed funding in a pre-series A Round led by the Kaikaku Fund, a SoftBank affiliate.
Other participants in the round were global investors 500 Startups, and IMJ Investment Partners.
The Kaikaku Fund was founded in 2014 as a collaboration between strong local partners, SoftBank and affiliates. It is focused primarily on investing in leading Philippine Internet and consumer companies.
Pawnhero co-founder and chairman David Margendorff said, several other venture capitalists and angel investors from the region and Silicon Valley have steadily followed suit.
PawnHero will use the funds for talent acquisition and continuing its mass outreach in the Philippines.
Margendorff said, Pawnhero has been growing rapidly since its launch in early 2015.
“Even more Filipinos will know that they can now pawn online without leaving their homes, at half the interest of what other pawnshops charge,” Margendorff said.
Kaikaku Fund vice president Teddy Himler expressed confidence with Pawnhero’s reinvention of the traditional pawning industry.
“PawnHero offers greater transparency, fairness and convenience, while addressing the borrowing needs of a majority connected yet unbanked or underbanked population,” Himler said.
IMJ Investment general manager Yasu Seo said, the Philippines is the ideal market to start Pawnhero’s service, as pawning is the major financing method instead of banking for its people.
“Online pawnshop is exactly the kind of innovation I believe that can help unbanked citizens,” Seo said.
500 Startups managing partner Khailee Ng sees a lucrative opportunity for Pawnhero’s business model, citing most startup investors don’t go to pawnshops to get loans but millions of people in Southeast Asia do every day.
“PawnHero will literally change their lives, and in the process, the region’s next big startup success story will emerge,” Ng said.
Only recently, PawnHero won the 2016 Hack Osaka pitch contest in Japan. This comes at the heels of a June 2015 win in the Echelon Asia Summit last year in Singapore where it bagged the title of “Most Promising Startup in Asia 2015.”
Prior to its launch in February 2015, PawnHero received funding from Sulficio “Jun” Tagud, chief executive officer of 2GO, the largest logistics provider in the Philippines.