Flutterwave, an African fintech, has secured $250 million in a Series D round, bringing its worth to almost $3 billion in just twelve months. B Capital Group is the lead investor in this Series D round, with Alta Park Capital, Whale Rock Capital, and Lux Capital as participating investors. Avenir Growth, Tiger Global, Glynn Capital, Green Visor, and Salesforce Ventures are among the existing investors who have increased their stakes.
“We’re becoming what we wanted to be: the infrastructure for any kind of payments,” CEO Olugbenga Agboola said. “There’s no sector you look at today in Africa that you wouldn’t see Flutterwave taking a piece of that and enabling merchants and consumers to grow and scale.”
The San Francisco-based and Lagos-based startup raised $170 million in a Series C investment from Tiger Global and Avenir in March 2021, valuing the company at $1 billion. Flutterwave has raised a total of $475 million since its founding six years ago (it raised a $35 million Series B in 2020 and a $20 million Series A in 2018), confirming a Bloomberg scoop from October.
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Flutterwave has surpassed the $2 billion valuation established by SoftBank-backed fintech OPay and FTX-backed cross-border payments platform Chipper Cash last year to become the most valuable African firm at $3 billion.
Flutterwave will be able to develop more complementary items with the increased funding. It will also aid the company in accelerating client acquisition in existing markets and expanding through mergers and acquisitions, according to a statement.
Why The Investors Invested
Since its previous investment last year, Flutterwave has grown by leaps and bounds. The payments company reported processing 140 million transactions totaling more than $9 billion last year. After a year, the African payments behemoth has grown to execute 200 million transactions worth more than $16 billion across 34 nations on the continent.
The number of companies that use its platform has also grown. It was 290,000 in March 2021; now, 900,000 businesses utilize Flutterwave to process payments in 150 currencies and across many payment modalities, including local and international cards, mobile wallets, bank transfers, and Barter, the company’s consumer product.
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“Flutterwave may eventually establish one of the most impactful fintech businesses in the world, enabling hundreds of thousands of merchants to transact online and connecting Africa to the global economy,” said Matt Levinson, partner at B Capital, in a statement.
A Look At What The Startup Does
Flutterwave, led by founder and CEO Olugbenga “GB” Agboola, uses a single API to simplify cross-border financial transactions between small and large firms in Africa. The firm also assists companies from outside Africa in expanding their operations on the continent. Booking.com, Flywire, and Uber are some of its foreign clientele.
While Flutterwave’s market dominance in enterprise payments has been the driving force behind the startup’s continuing growth, retail and consumers have also played a role.
“It was deliberate from us because we saw the opportunity in the SMB space, and how they require the same technology pie the Ubers and Netflixes of this world use,” Agboola said. “Some of this is evident is how we expanded the Flutterwave Store, which allows small businesses anywhere in Africa to create an e-commerce shop online at zero cost scale.”
The Flutterwave Store, which first opened in April 2020, was renamed Flutterwave Market in November of last year. The e-commerce platform has grown to over 30,000 merchants, allowing customers to browse for a wide range of products. Flutterwave introduced Send, a remittance service that allows users to send money to and from African recipients, in December.
Customers use Send, which Agboola describes as “Flutterwave’s fastest-growing product,” to pay for things like family support, presents, and tuition, according to the business. In its first full month of operation, Send handled 4,729 transactions, generating a total payment volume of $3.59 million. The majority of its clients are from Nigeria, the United States, and the United Kingdom.
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Flutterwave has expanded its services to Egypt and Morocco after scaling its payments solution across Sub-Saharan Africa. Flutterwave’s expansion into these countries, according to Agboola, is the first stage in the company’s drive into rising markets including the Middle East and Latin America. “We want to shift our attention away from Africa and toward emerging areas, like the United States, the United Kingdom, and Europe. Our goal is to ensure that such corridors are powered by our infrastructure,” he stated.
Despite the fact that Flutterwave’s headquarters are in the United States, the company has no operations there. The majority of its business in the United States was forging alliances with fintech behemoths like PayPal, Visa, Discover, and Worldpay FIS to facilitate worldwide payments with Africa.
That however changed in August, when Jimmy Ku was hired as head of growth to oversee the company’s expansion into the United States. Flutterwave now has an ACH network in the North American country, with a few customers making ACH payments, collections, and payouts using the platform. In a similar line, Flutterwave launched Grow in September as a service that assists African firms in registering and incorporating in the United States and the United Kingdom.
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Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer