Flutterwave wants to acquire UK fintech, Railsr
Global payments company, Flutterwave wants to acquire Railsr, a UK-based fintech company, according to Sky News UK.
Almost a year after African payment unicorn, Flutterwave co-led a $3.4 million seed investment into Dapio, a UK-based cashless payment solutions provider for businesses, the company is vying to acquire Railsr, another UK fintech.
Recall that after scaling its payments product across sub-Saharan Africa, Flutterwave expanded its offering to North Africa, starting with Egypt and Morocco, as the foundation for its global expansion strategy.
Prior to the Dapio investment, Flutterwave founder and CEO Olugbenga “GB” Agboola said, "[the company] want to change [its] focus from just Africa to emerging markets and eventually the US, the UK, Europe. Our goal is to ensure that our infrastructure powers those corridors". For instance, in August 2021, the fintech company hired Jimmy Ku to drive its expansion in the US.
According to a report by Sky News UK, Flutterwave and a consortium of existing Railsr investors want to acquire the British company in what is described as "heavy competition". The timing and outcome of the ongoing sale process are unclear at the time of the report. Railsr and Flutterwave are yet to comment on the report.
Railsr was founded by Nigel Verdon and Clive Mitchell in 2016.
Due to tightening market conditions, Railsr reportedly laid off 16% of its workforce in November 2022, this is after it laid off 10% of its employees in May of the same year.
The company disclosed that its "burn rate was too high in complex but attractive markets such as the US".
Following its $250 million Series D in February 2022, Flutterwave disclosed that it will speed up customer acquisition in existing markets and grow through mergers and acquisitions. "We plan to grow inorganically through acquisitions, and it will happen when we find a fit and see a company with the same core values or culture and goal of making payments simpler across emerging markets. So we still have plans for that," Agboola said at the time.
Prior to this public disclosure, the company acquired Disha in November 2021—the creator platform that was set to shut down in December 2022 due to "shortfalls with the platform's vision" and other unresolved misalignments.
Shortly after Disha's acquisition which some public commentators saw as unfit for the company's core payment business, Flutterwave co-led a $2.4 million investment into CinetPay, a digital payment platform for merchants in Francophone Africa.
The acquisition of Railsr will drive the company's global expansion vision. Omosalewa Adeyemi, Flutterwave's senior vice president for market penetration is yet to respond to Benjamindada.com's comment request at the time of this report.
2022 at Flutterwave: Planned IPO, scandals and new global hires
Last year, Flutterwave and its CEO faced several allegations of financial impropriety, sexual misconduct and regulatory challenges from different regulators, journalists and other individuals including the Kenyan Asset Recovery Agency, and the Central Bank of Kenya. The fintech also came under the scrutiny of the Bank of Ghana.
With over $3 billion valuation, Flutterwave is also planning a Nasdaq IPO, according to Bloomberg. The company made significant appointments to its C-suite last year. Marshall Lux, former chief Risk Officer at JPMorgan Chase joined Flutterwave as a senior advisor as part of the company's efforts "to meet global risk management and compliance standards for merchants and partners as the business scales".
Flutterwave also hired a chief financial officer and chief technology officer in 2021.
Editor's Note: This is a developing story, it will be updated with more details.