International Finance Corporation (IFC), a member of the World Bank Group, on Tuesday announced a $2.5-million equity investment in Sri Lankan ride-hailing app PickMe, marking its foray into the country’s venture capital space.
The investment will help the company expand across the island and increase access to affordable, safe, and efficient transportation, it said in a statement.
IFC had first disclosed its intent to invest in PickMe, operated by Digital Mobility Solutions Lanka, in April this year.
PickMe, which launched operations in 2015, was founded by serial entrepreneur Jiffry Zulfer. The platform helps customers call anything from an autorickshaw to a luxury car using its smartphone app. It is currently operational in four districts of the country including Colombo, Kandy, Gampaha and Kalutara, and claims to cater to the travel needs of over a million users.
Sri Lanka has as many as 31 people for each registered car and 20 for each autorickshaw. The sharing economy —especially ride-hailing — has the potential to better serve women, IFC said.
“We at PickMe have a strong expansion program in place as we enter new cities and diversify our operations to reach more customers, and serve them better,” said PickMe CEO Zulfer. “We are excited to be able to draw from the best practices and global knowledge that IFC brings.”
Sri Lanka’s venture ecosystem is growing, but funding options are still limited. A mere 5 per cent of the startups that get seed funding manage to raise Series A rounds. IFC’s entry into this space is expected to attract more capital, domestic and international, for the country’s technology startups, the statement said.
“Sri Lanka possesses many of the building blocks for a thriving digital startup ecosystem, but has been held back by a lack of global expertise and funding,” said Amena Arif, IFC Country Manager for Sri Lanka and Maldives. “Through this partnership, we want to help make travel safer, increase revenues for the company’s driver partners, and support the growth of Sri Lanka’s startup ecosystem.”
IFC’s committed portfolio in Sri Lanka covers projects across a range of sectors, including infrastructure, tourism, renewable energy, finance, and healthcare. It also provides advisory services to promote sustainable growth among small and medium enterprises by facilitating access to finance and by offering capacity-building and training opportunities.
In FY17, IFC extended a record $19.3 billion in long-term financing to developing countries.