African fintech Flutterwave raised $250 million in a Series D funding round that tripled the company’s valuation to over $3 billion in correct twelve months.
In March 2021, the San Francisco and Lagos-based startup raised $170 million in a Series C funding round from Tiger Global and Avenir at a $1 billion valuation. The latest funding, which confirms a Bloomberg scoop from October, brings Flutterwave’s total increase since its creation six years ago to $475 million (it raised a $35 million Series B in 2020 and a $20 million Series A in 2018).
At $3 billion, Flutterwave is currently Africa’s most valuable startup, surpassing the $2 billion valuation set by SoftBank-backed fintech OPay and FTX-backed cross-border payments platform Chipper Cash last year.
Led by Founder and CEO Olugbenga “GB” Agboola, Flutterwave facilitates cross-border payment transactions for small and large businesses in Africa via an API. The company also helps companies outside of Africa expand their operations on the continent.. Some of its international customers include Booking.com, Flywire, and Uber.
Flutterwave has seen astronomical growth since TechCrunch covered its unicorn ride last year. At the time, the payments company said it had processed 140 million transactions worth more than $9 billion.. A year later, the African payments giant, with an infrastructure spanning 34 countries on the continent, is now processing 200 million transactions worth over $16 billion.
The number of companies using its platform has also increased. In March 2021, it was 290,000; Today, 900,000 businesses around the world use Flutterwave to process payments in 150 currencies and through different payment methods: local and international cards, mobile wallets, bank transfers and its consumer product Barter.
While Flutterwave’s market share in enterprise payments has principally responsible for this growth, diversification into fintech products for small and medium-sized businesses, retail and consumers has also played a role.
“It was deliberate on our part because we saw the opportunity in the SMB space, and how they require the same technology that the Ubers and Netflix of this world use,” Agboola told TechCrunch. “Part of this is obvious is how we have scaled up the Flutterwave store, which enables small businesses from all over Africa to create an online e-commerce store at zero cost scale.”
The Flutterwave Store, launched in April 2020, has been revamped last November at Flutterwave Market. The e-commerce solution has grown to over 30,000 merchants that consumers can purchase from a variety of products. In December, Flutterwave launched Send, a money transfer service that allows users to send money to recipients in and from Africa..
Customers use Send – which Agboola called “Flutterwave’s fastest growing product” – principally to pay for family support, gifts and tuition, the company told TechCrunch. Send processed 4,729 transactions, with total payment volume exceeding $3.59 million in its first full month of launch. Majority of its customers are from Nigeria, USA and UK
“were become what we wanted to be: the infrastructure for all kinds of payments,” said Agboola. “There’s no industry you look at today in Africa that you wouldn’t see Flutterwave taking a piece of and enabling merchants and consumers to grow and scale.”
After expanding its payment product across sub-Saharan Africa, Flutterwave has extended its services north to Egypt and Morocco. Agboola said expansion into these countries is the first step in Flutterwave’s move into emerging markets such as the Middle East and Latin America. “We want to change our focus from correct Africa to emerging markets and ultimately the United States, the United Kingdom, Europe. Our goal is to ensure that our infrastructure powers these corridors,” he said.
Although Flutterwave is headquartered in the United States, it has no operations there. Most of its affiliate business in the US involved partnerships with fintech giants such as PayPal, Visa, Discover and Worldpay FIS to facilitate global payments with Africa.
But that changed last August when it hired Jimmy Ku as head of growth to lead its US expansion. Now Flutterwave operates an ACH network in the North American country with a few customers using the platform to make payments, collections and ACH payments. In a similar vein, Flutterwave launched Grow last September as a product that helps African businesses register and incorporate in the US and UK..
The new capital gives Flutterwave ammunition to develop more complementary products. It will also help the company accelerate customer acquisition in existing markets and grow through mergers and acquisitions, the company said in a statement.
Flutterwave’s first public deal was to acquire creative platform Disha for an undisclosed six-figure amount.. The reason for buying was lost on some viewers because Disha didn’t fit Flutterwave’s core payout business. EAlthough Flutterwave has wrapped up Disha’s 20,000 creators or businesses (not all of them were active at the time of the acquisition) and intends to play the long game of participating in the global creator economy, the immediate goal of the deal, it seemed, was to rescue a failing startup and back it up with a robust payment system.
Going forward, Flutterwave will consider acquisitions that will enable consolidate its authority in the fintech space. And as the payments giant continues to deepen its influence in the SMB and consumer fintech space, we can assume that smaller startups – including those it has backed, like CinetPay – could become targets. acquisition.
“We plan to grow inorganically through acquisitions, and that will happen when we find a fit and see a company with the same core values or the same culture and the goal of simplifying payments in emerging markets. So we still have plans for that,” said the chief executive, who has also personally backed several startups and most recently through the new $200m pan-African fund Norrsken22.
While some global investors have recently expressed concern on startup valuations in the face of falling public tech stocks, others are increasing their risk appetite and the Flutterwave deal reflects that reality. Its latest backers in this Series D round include lead investor B Capital Group and participating investors Alta Park Capital, Whale Rock Capital and Lux Capital. Existing investors such as Avenir Growth, Tiger Global, Glynn Capital, Green Visor and Salesforce Ventures also doubled their investment.
Explaining why his company invested, Matt Levinson, partner at B Capital, said in a statement, “Flutterwave could ultimately create one of the world’s largest fintech companies, enabling hundreds of thousands of traders to transact online and connect Africa to the world. Mondial economy.”
But as one of Africa’s tech unicorns (currently the best-loved of the lot, which includes OPay, Chipper Cash, Andela, Wave and Interswitch) and the iconic child of African fintech (a sector that has received between 50 and 60% venture capital year), tech players are counting down to the days when Flutterwave goes public. That’s not in the fintech giant’s immediate plans as it seeks to continue scaling, according to its chief executive.
“At the moment, no IPO,” Agboola said. “The goal is to continue to grow and evolve. But obviously, we plan to be IPO ready from a maturity perspective, which means continuing to build the infrastructure, crossing our Ts and pointing our Is if we choose to go that route.
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