Nigerian mobility startup Mecho Autotech has secured $2.4 million in pre-Series A funding to expand its automotive spare parts, vehicle repair, and maintenance services across Nigeria. Global Brain Corporation, Uncovered Fund, and Ventures Platform participated in this funding round. Mecho Autotech plans to utilize these funds to launch a B2B distribution platform for aftermarket spare parts, targeting the estimated $8 billion market.

In Nigeria, spare parts account for 80% of the automotive value, with vehicle owners spending an average of $650 annually. The country has over 12 million registered vehicles, predominantly imported and pre-owned, resulting in a fragmented and informal aftermarket spare parts supply chain.

Mecho Autotech aims to address this issue by leveraging partnerships with Asian aftermarket spare parts manufacturers to offer affordable spare parts to vendors and workshop owners, thus increasing the availability of high-demand spare parts and addressing stockouts.

CEO Olusegun Owoade stated, “In our original business model, our core focus was on vehicle maintenance and repair. But we soon realized a much larger issue – an extreme scarcity of high-quality spare parts in the market.”

Since its establishment in 2021, Mecho Autotech has served over 6,000 cars through more than 110 approved workshops, including three of its own. As of February 2022, it had 40 B2B customers with over 20,000 vehicles and had serviced more than 2,000 vehicles. The startup has also onboarded over 7,000 third-party mechanics across three workshops in Lagos, servicing B2B customers.

Mecho Autotech collects spare parts demand data through specialized apps for supply chain players to assess market supply. In Q4 2023, the company plans to develop an app enabling vendors to access inventory finance and manage sales, offering workshops working capital and spare parts acquisition support.

Additionally, in partnership with local banks, Mecho Autotech will provide credit of up to 10 million naira to automotive supply chain players, covering inventory financing, working capital, and financing for vehicle maintenance and parts procurement.

Mecho Autotech’s mission is to enhance the efficiency of the automotive spare parts supply chain through technology and financing. Tekedia Capital is among the investors supporting the startup, which aims to make quality spare parts more accessible for vehicle owners and workshop operators throughout Nigeria.