Visa’s $1 billion African Expansion
Plus, two African startups in Y Combinator's latest cohort
Welcome to Tech Safari! Your tour guide on African Tech 🧭
Today is Startup Saturday, where we dive into startup news and deal activity in the world's most exciting continent.
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Here's the tour plan for today 🧭
- Visa’s $1 billion expansion into Africa
- Deal Roundup
- Events and Opportunities
- Tech Twitter
Alright, lets get this tour started 🦍
Visa’s $1 billion expansion into Africa
In December last year, Visa - the US Digital Payment Giant - announced a $1 billion dollar investment in Africa by 2027.
The official press release is here, and it’s full of adjectives and aspirational words. So I broke it down for you - here are the key takeaways.
- 500 million people don’t have access to financial services in Africa
- Less than 50% of adults in Africa have ever made or received digital payments
- 40 million merchants don’t accept digital payments yet.
Payments are still unsolved in Africa. It’s a cash-based world and most people still don’t have access to digital payment services.
Visa believes that as more consumers and businesses come online, digital payments will grow in Africa - and they want in on the bag.
The Expansion Plan
Now, Visa wasn’t specific about where that $1 billion will be invested. But we have a few hints.
Visa has been active on the continent for a while now. In the last few years they have:
- Set up 10 offices across Africa. More recently Visa set up offices in Ethiopia, Democratic Republic of Congo and Sudan - these countries are relatively untouched (and often avoided) by investors due to instability and poorer infrastructure.
- Launched an innovation studio in Nairobi, Kenya. A fancy (or corporate?) way to say co-working space.
- Launched contactless payment in South Africa, which they aim to roll out across Africa in the years to come.
- Started programs for women’s empowerment, like She’s Next, in South Africa, Kenya, and Nigeria to help more female entrepreneurs start and grow their businesses.
It’s not just offices, products and programs. It’s capital too.
Visa’s African Portfolio
Visa is an active investor in African startups and has made strategic investments in the biggest fintechs - buying a nice stake in Africa’s payment landscape.
Visa has invested in five of Africa’s most promising payment and banking startups:
- Paystack (Nigerian payment processor) - Visa invested in Paystack’s $8m Series A Round in August 2018 - two years before it was acquired by Stripe for $200m.
- Flutterwave (Nigerian payment processor) - Visa invested in Flutterwave’s $35m Round in January 2020. Flutterwave launched a virtual card product called Barter with Visa, which used Visa’s payment networks.
- Interswitch Group (Nigerian digital payments platform) - Visa bought a 20% stake in Interswitch, bringing the valuation up to $1 billion dollar.
- Bloom (YC W22) (Sudan’s first neobank) - raised a $6m Seed Round in 2022 led by Visa. They joined Visa's fintech Fast Track Program and switched their cards from Mastercard to Visa.
- JUMO (South African banking-as-a-service platform) - Raised a $120m round in 2021 which saw participation from Visa.
Visa is doubling down to become Africa’s fintech partner of choice, powering payments across the continent.
What do you think Visa’s expansion plans tell us about Africa’s potential? Let me know on LinkedIn here.
- Shekel Mobility - a Nigerian neobank and trading platform for auto dealers - has been accepted into Y Combinator.
- Bujeti - a Nigerian expense management platform - has been accepted into Y Combinator.
- Millesima Technologies - a Tunisian data technology and video streaming platform - raised $480K from BH Equity.
- Solarise Africa - a South African renewable energy-as-a-service company - raised $3M from EDFI ElectFI.
- Mahasseel Masr - an Egyptian fresh produce platform - has raised an undisclosed amount from Emirates International Investment Company (EIIC).
- Teraki - an Ethiopian Audiobook and Podcast startup - raised an undisclosed amount from Renew Capital.
Mergers + Acquisitions
- Underlie - an Egyptian online platform offering open banking to banks and businesses - has been acquired by Fintech Galaxy - a Dubai-based fintech firm.
Events + Opportunities
- Included VC is hosting a VC Summit spotlighting the Black VC community. The summit runs from the 17th-19th of January. Register to attend here.
- Dream VC's 2023 Program has opened up Expressions of Interest. Dream VC is an Accelerator for the next generation of African Investors. Learn more here.
Our favourite tweets on African tech this week
African fintech really does have a long way to go..
It's 2023 and Ghanaian banks still ask you to draw a map to your house. C'mon!
— Maajoa (@NomadicMaajoa)
Jan 3, 2023
Emeka writes that effectively $0.00 of every VC dollar invested globally goes to Africa.
It's that time of the year in #AfricaTech when last yr's fundraising totals will be sliced & diced
But while much brouhaha will be made about $5b, it's important to keep things in context: it's still the earliest days for Africa's tech ecosystem
Africa barely registers globally
— Emeka Ajene ✍🏽 (@eajene)
Jan 5, 2023
ICYMI - Meet the Cellulant Mafia. I wrote about Cellulant's wild origin story a few weeks ago - you can read here.
You may know the @PayPal Mafia in the US
and the @paystack mafia in Nigeria.
But what about the @Cellulant Mafia in Kenya?
Cellulant has been around for 18 years.
The company has spawned the most East African founders than any other
Here are their founders 👇🏾
— Caleb Maru ⭕️ (@calebmaru)
Jan 2, 2023
And that's a wrap!
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