Masa Finance, a San Francisco, CA-based hybrid credit protocol that bridges off-chain data with on-chain data to create a Hybrid Credit Protocol & Decentralized Credit Bureau, closed a $3.5m Pre-Seed funding round.
Backers included Unshackled Ventures, executives from GoldenTree Asset Management (a $46bn credit-focused fund), Flori Ventures (Celo-focused fund), GSR, Decentranet, Intersect VC, Lateral Capital, Peer VC, Alves Ventures, and several angel investors in the fintech/blockchain space including Louis Beryl (founder of Earnest), Gustavo Menezes (24hr of Le Mans Driver for Peugeot Sport), and Jacob Riglin; a high-profile NFT artist who will be launching future NFT-collateralized loan products.
Before starting Pngme, an open finance startup that has raised over $18 million in VC funding, Playford actively worked in the blockchain and crypto space for almost a decade. Last February, he revealed that this involvement led him to offer short-term crypto loans to entrepreneurs, particularly in Kenya and Tanzania — and traditional loans via Pngme before pivoting to an open finance play.
Masa Finance is the result of these collective ventures. According to Playford, the company is built on three blocks: unlocking financial data (which Pngme does), new sources of capital, and allowing individuals to own their credit history and share it with any lender themselves.
The company intends to use the funds to increase the engineering team’s size and launch the protocol’s production release, conduct a public token sale, scale users and node operators, and bring developers and lenders to the platform.
Masa says its on-chain data covers 26 integrations, from exchanges to wallets — opening up a 4.95 billion-person market where 67% are credit invisible. These wallets include Binance, Coinbase, FTX, Gemini and Metamask.
“The reason why they’re partnering with credit bureaus is it increases coverage for the most number of users. Our mission is to bring the next billion people to DeFi by providing credit bureau reports. And to do that, you have to support existing infrastructure and partner with those currently in the market,” said Playford when asked why Masa chose a hybrid model instead of a full decentralized model.”
Playford said Masa is building on Celo and Ethereum, and the platform, which is launching out of beta, has 36,000 people signed up already. Most of its current users are based in sub-Saharan Africa — Nigeria and Kenya in particular. Users from these countries, including Uganda and the Philippines, are responsible for the highest volume of loans received in Goldfinch, a competitor that raised $25 million from a16z and Coinbase Ventures in January.