Smile Identity, a digital identity and KYC (Know Your Customer) company, has acquired Inclusive Innovations, an identity verification company based in Ghana. Inclusive Innovations is the parent company of Appruve, which operates in the same arena as Smile Identity and offers ID verification for individuals and businesses. This acquisition will support Smile Identity’s on-ground expansion plans and the spread of its digital identity solutions across Africa.
Smile Identity offers automated document verification and authentication services, AML Compliance screening, biometric authentication, user verification and onboarding, and other fraud prevention security services to help businesses across Africa verify the identity of their users/customers before onboarding them into a product/system of value. On the other hand, Appruve focuses on connecting multiple databases to create a story around an individual or business. This technology is made accessible through APIs and SDKs to businesses and individuals.
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The World Bank’s Identity for Development (ID4D) toolkit states that almost half of the one billion people who lack identification globally are in Africa, which means that a significant percentage of Africans are excluded from economic and social benefits both locally and globally. Since 2017, Smile Identity has been providing digital identity verification services and security services to leading African companies including Paystack and OPay. The acquisition of Appruve’s parent company is a natural progression after years of partnership and collaboration between both companies in the African identity verification space.
Currently, the companies have reached a definitive merger agreement subject to regulatory and stockholder approval. The acquisition amount remains undisclosed. Key members of Appruve are now shareholders in Smile Identity, and most of the Appruve team is being kept onboard.
With this merger, both companies are working together to achieve the same goals collectively and more efficiently. They will continue to build and deepen their expertise on what solutions work across different markets with additional insights into the Ghanaian market from the Appruve team. The combination of talent and experience will also strengthen their broader understanding of the direction of KYC in Africa and their relationships with regulators and compliance officers in the public and private sectors on the continent.
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For customers, they’ll improve on the offerings that they previously enjoyed. Customers will be able to get access to all the services of both Smile Identity and Appruve and enjoy more robust solutions over time with expertise from both companies. With this acquisition, Smile Identity looks forward to helping customers access deeper and richer services including onboarding into payment systems (mobile money, bank accounts, international payments and remittance, etc.) both locally and internationally; stock trading and brokerage; business lending; and much more in the coming months.
Smile Identity’s acquisition of Inclusive Innovations, the parent company of Appruve, can be seen as a strategic move for several reasons:
- On-ground expansion: The acquisition will aid Smile Identity’s on-ground expansion plans in key markets in West Africa where they want to invest more. This will enable the company to deepen its presence and increase its market share in these regions.
- Synergies between teams: The acquisition will bring together the product engineering expertise of Appruve and the access to critical data sources that are important to Smile Identity. This will enable both companies to leverage each other’s strengths and create synergies that will benefit their customers.
- Access to more datasets: Smile Identity and Appruve share a vision of which datasets across Africa are important. By merging forces, they will have access to a wider range of datasets, which will enable them to build more holistic profiles around people and entities they’d like to verify.
- Deeper penetration in local markets: The acquisition will enable Smile Identity to deepen its expertise on what solutions work across different markets with additional insights into the Ghanaian market from the Appruve team. This will enable the company to build more robust solutions and strengthen its relationships with regulators and compliance officers in the public and private sectors on the continent.
- Access to more customers: With hundreds of customers and 60 million identity verifications so far, Smile Identity is already moving the needle on onboarding and identity verification in Africa. With this acquisition, they will be able to offer more robust solutions to their existing customers while also gaining access to Appruve’s customer base.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard