Flutterwave, an Africa-focused payment technology company, has raised $170 million in a Series C round, positioning itself to further connect and capitalize on the continent’s thriving yet highly fragmented digital payment landscape.
The round now values the company at more than $1 billion. It was led by the US-based investment firms Avenir Growth Capital and Tiger Global Management, with participation from new and existing investors including DST Global and Salesforce Ventures. The latest funding brings the total investment in the five-year-old company to $225 million.
A fragmented industry
Africa’s electronic payment industry—including card, e-commerce, digital banking transactions and more—has exploded in recent years, generating about $20 billion in revenue in 2019, according to McKinsey.
But its deep fragmentation has proved to be a barrier for many businesses. Debit and credit card ownership is low, and digital payments are often made through hundreds of banks and mobile wallets. In order to get paid by customers, businesses are often forced to take the expensive approach of integrating their systems with numerous different service providers and banks.
Founded in 2016, Flutterwave helps businesses from around the world expand their operations in Africa and other emerging markets with a platform that enables cross-border transactions through one API. Businesses can use the platform to create customized payment forms and collect that payment from customers without having to sync with multiple payment systems. The San Francisco-based company already serves more than 290,000 businesses in Africa, including Uber, Facebook, and Booking.com.
“Flutterwave’s job is to be what we call ‘the center point’—the plumbing of African payments infrastructure,” Olugbenga Agboola, the company’s founder and CEO, told Quartz. For example, the company’s technology makes it “easy for a merchant in Lagos to receive payments from somebody in Nairobi, via M-Pesa,” Agboola said, “because Flutterwave has done the dirty work of building the plumbing of African payments, and connecting every payment type together.”
Thriving digital payment market
Many fintech companies are looking to capitalize on Africa’s thriving digital payment market. Last year, Nigerian payment startup and Flutterwave competitor Paystack was acquired by the US payment processing company Stripe in a deal reportedly worth more than $200 million. Also last year, DPO Group, a Nairobi-based payment service provider for African businesses, was acquired by Network International, a Dubai-based digital payment company, in a deal worth $288 million.
Flutterwave has processed more than 140 million transactions worth more than $9 billion combined. Its payment platform is currently available in more than 33 African countries. With the new funding, the company wants to expand to north Africa and scale its business in Francophone Africa.
“Flutterwave has a big mission,” Agboola said, to “make Africa feel like a country, even though it’s not one, in the payment space.”
Sign up to the Quartz Africa Weekly Brief here for news and analysis on African business, tech and innovation in your inbox.