Flutterwave, Inc. ("Flutterwave") recently announced that they had completed their Series A extension round of financing.
The fintech company which was co-founded in May 2016 by Iyinoluwa Aboyeji to enable pan-African payments has now raised over $20 million according to the company.
Although the actual value of this round remains undisclosed, our computation shows that they raised another $10 million since their first Series A round of $10 million.
We arrive at this figure by subtracting their two $50,000 seed rounds (one of which was non-equity assistance) from the total rounded value of $20 million.
Greycroft Partners and Green Visor Capital led Flutterwave's first Series A raise with participation from Y Combinator and Glynn Capital. While Mastercard, CRE Venture Capital, Fintech Collective, 4DX Ventures, and Raba Capital led this extension round. Their previous investors include Omidyar Network, Social Capital, and HOF Capital. Till date, their biggest investors are Green Visor Capital and GreyCroft Partners. In total, Flutterwave has over ten investors which could be a sign of trust in the company's prospects by multiple interested parties.
As part of the financing, current Green Visor Capital Chairman, and General Partner, former Chairman & CEO of Visa, Joe Saunders, joined the Flutterwave Board of Directors. Joe would be bringing his experience as a Venture Capitalist and the Chief Executive Officer of a multibillion-dollar financial services company to the Board in helping the company prepare for their post-funding phase.
Also, it makes sense that a card company like Mastercard would back a complementary company providing the infrastructure that makes digital payments easier (note: the use of a card for payment relies on digital means, so improved digital infrastructure means an enhanced chance for payment to happen via card). On the African continent today, credit card penetration is about 3%. Except South Africa, many countries on the continent look to cash as their primary payment method. As of 2015, there were fewer than 2 million cards in circulation in Nigeria which is lesser than 2% of Africa’s largest economy’s total population.
However, as the internet and mobile penetration grows alongside disposable income, there is the expectation that the number of people making use of cards for payments would increase.
And with Flutterwave's core focus on Africa, it's a no-brainer for global card provider, Mastercard to be there with them waiting for Africans to adopt cards as their primary means of payment.
Another adverse effect of low-card adoption in these parts of the world is that it is difficult for global businesses like Uber to penetrate our market, as a result of the trouble that comes with accepting payments.
While speaking to YCombinator, Iyin Aboyeji narrates the story of how they (at Andela, headquartered in New York) had to process payments periodically to avoid incurring too many fees. Even at that it still took a while before the money hit their bank in Africa. At other times, some others have had to ship physical cash to other parts of the continent to make payments.
But Flutterwave is solving for that and many more with their payment infrastructure, which is primarily one API that integrates to all the known payment channels (like banks, Mastercard & Visa) and saves their customers the time from doing it themselves.
Currently, Flutterwave (their API) makes it easier for the almost 24,000 businesses (including Uber, Transferwise, Flywire, Booking, and JumiaPay) and individuals using its solution to process payments across Africa.
The African market is characterised by multi-channel payments plus a drive for financial inclusion (for countries), both of which Flutterwave has positioned themselves to tackle. Financial inclusion in the senses that previously economically inaccessible countries can now be accessed via Flutterwave's one API for payments.
Since its founding in May 2016, Flutterwave has processed over $2.3 billion in payments across 60 million transactions and partnered with seven (7) banks namely: Standard Bank, First Bank, Guaranty Trust Bank, Zenith Bank, Access Bank, United Bank for Africa, and Ecobank.
Olugbenga Agboola takes over as Flutterwave CEO
In other related news, the company's co-founder and CEO – Iyinoluwa "E" Aboyeji has stepped down to "pursue family goals" while fellow co-founder, Olugbenga Agboola has replaced him as the CEO.
E is reported to have said "it’s been amazing working with the Flutterwave team to build another great African company and I’m excited for the future under its new leadership."
Olugbenga would be combining his experience as a Product Manager (working at Google on their fintech product, Wallet) and a banker (leading Access bank's digital innovation) to move the company forward.
The new Flutterwave CEO (who was the CTO) wished E success in his future endeavours. "On behalf of the entire Flutterwave team we wish Iyin luck in his future endeavors. Moving forward; the entire Flutterwave team and I are excited for Flutterwave’s future and look forward to growing the company."
We believe Flutterwave is in good hands despite E's departure as his co-founder would be able to carry on the torch as CEO.
We would be here covering the story every step of the way.