Posted In:

Africa, Funding, VC


#428
It’s Time for Africa!

Published:

Mar 12, 2022


Author:

Roxy Horrie

Posted In:

Africa, Funding, VC

Published:

Mar 12, 2022


Author:

Roxy Horrie


Share:

As if the world needed more surprises, this week marked the (re)discovery of Ernest Shackleton’s ship off Antarctica, exactly 100 years to the day of Shakelton's death! What’s even more remarkable, despite being about 10,000 feet underwater, the Endurance was almost completely intact. In a heroic expedition marked by adversity and perseverance, this week's event is an epic last chapter.

Shackleton's story also reminds us of the difficulties - and incredible potential rewards - of pushing past well-known frontiers. Though quite the opposite from a climatic perspective, Africa's tech ecosystem is serving a similar reminder to the international investor community. The overwhelming talent, growth, and opportunity throughout the continent have left investors scrambling to better understand market dynamics and become involved as quickly as possible. This trend is evidenced by enormous increase in global investment volumes, as over $5b in venture capital funding entered the continent last year and seven new unicorns were born (joining the ranks of Jumia, Interswitch and Fawry). Before 2021, just eight African startups had raised $100m+ rounds; last year, the number nearly doubled.

The region remains fragmented and difficult to navigate. On top of that, interrupted engagement with certain external financial partners has recently brought to light the question of biases against operators on the continent. As understanding of the unique market dynamics improves and funding becomes better distributed (including from a gender perspective) companies will be better positioned to bring a variety of experiences and resources to further develop the tech ecosystem. Those companies that are able to succeed in these markets, especially in the fintech space, have the potential to both increase financial resilience among users and attract progressively more global venture funding.

This flurry of deal flow and investor attention is augmented by strong macro tailwinds. As the world’s fastest growing continent, Africa is estimated to account for 1/3rd of the global population by the end of the 21st century. Young, digitally native citizens that remain cash-constrained have created a wealth of opportunity for fintech connoisseurs. And speaking of dreaming, the big question remains for 2022...will an African nation finally be able to break Ghana’s 2010 curse and make it past the quarterfinals of the World Cup?

Portfolio News


Antler East Africa closes $13.5m fund to invest in early-stage startups - Antler East Africa was launched in August 2019. Five cohorts with 153 founders have passed through the accelerator programs so far, and the firm has made 14 investments. A few of them include AIfluence, Marketforce-subsidiary Digiduka, Honeycoin, Uncover Skincare, Try Cooked and Vybe. Read more

Brazil’s Contabilizei raises $60m in Softbank-led Series C - Accounting services firm Contabilizei announced this week that it had raised $60m in a Series C round led by SoftBank, with Goldman Sachs and Pruven Capital also participating in the investment. CEO Vitor Torres says the goal of the round is to expand the startup's service and product offerings. Contabilizei emerged in 2013 to help micro and small business owners to open a company for free and keep their accounting up to date. Read more

It's Time For Africa


2021 marks a record breaking year for African venture funding - African fintech startups received over half of the total VC funding in 2021, while Nigeria topped African VC investment destination, followed by South Africa, Egypt, and Kenya. Read more

Report reveals only 3% of all the investments made into African startups between 2013 and 2021 went to female-led startups - Although investments into Africa’s burgeoning tech ecosystem have been on the rise recently, 76% of the total funding during the 8-year period went to startups led by all-male teams. Read more

Mercury, a San Francisco-based digital bank for startups, blocked African founders' accounts without prior communication - The implications of this incident are bad for the affected startups, and has also put a dent on Mercury’s reputation on the continent. Read more

AWS, Vodacom, and Intel launch South Africa based program - The laboratory, located in Johannesburg, will serve as a Proof of Concept setup for customers to test their applications and environment for performance on AWS Outposts, and will focus on delivering faster scalability and creating opportunities. Read more

African e-commerce company, Jumia, releases best quarterly report to date - Total orders on Jumia reached 30m last year, while the number of customers who placed at least one order increased to 8m, from 6.8m in 2020. The company fulfilled 3m more orders in the last three months of 2021 than in the same period two years. Read more

Industry News


Biden signs order on cryptocurrency as its use explodes - President Joe Biden signed an executive order this week on government oversight of cryptocurrency that urges the Federal Reserve to explore whether the central bank should jump in and create its own digital currency. Treasury Secretary Janet Yellen said the effort would “promote a fairer, more inclusive, and more efficient financial system” while countering illicit finance and preventing risks to financial stability and national security. Read more

Facebook Libra: the inside story of how the company’s cryptocurrency dream died - It had the blue-chip partners, the tech, and the right players. None of which could save it - The FT takes a look at how "Diem" died. Read more

Goldman Sachs shutters Russia business, first major Wall Street bank to leave after Ukraine war - Most big U.S. banks had modest operations in Russia, a geographically large nation with a relatively small economy. Citigroup had the biggest exposure as of year-end 2021 at $9.8b, according to filings. Goldman was estimated to have $940m in total exposure, including $650m in credit, or less than 10 basis points of its total assets, according to Bank of America analysts. Read more

Public buys Otis, bringing fractional ownership of alternative assets to its platform - The mix of product and corporate decisions appears to be working for Public, at least in terms of leading indicators. According to co-CEO Leif Abraham, Public now has 3m users. The company also announced this morning that it has purchased Otis, a startup that allows consumers to buy and trade fractional shares in individual alternative assets. Read more

Fraud is flourishing on Zelle. The banks say it’s not their problem - Consumers love payment apps like Zelle because they’re free, fast and convenient - last year, people sent $490b through Zelle, compared with $230b through Venmo, its closest rival. However, Zelle’s immediacy has also made it a favorite of fraudsters, and banks have been reluctant to make fraud victims whole — despite owning the system. Read more

Russian banks turn to China to sidestep cutoff from payments systems - Sberbank, Russia’s largest bank by assets, Alfa Bank and Tinkoff Bank said Sunday they were working on the possibility of issuing cards powered by China’s UnionPay. Another Russian lender, Gazprombank, said customers can do cross-border transactions by getting cards that use UnionPay or Japan’s JCB system. Read more

Cryptocurrency exchange FTX to start European operations - The company said FTX Europe will offer the parent’s products and services to European Union clients via a partnership with a “licensed investment firm” it didn’t name. FTX Europe will be headquartered in Switzerland, with approval to operate from the Cypriot financial regulator CySEC. Read more

Visa, Mastercard prepare to raise credit-card fees - The fee increases—delayed during the past two years because of the pandemic—are scheduled to kick in next month. Interchange fees account for most of the increase. Merchants pay these fees, which are set by the card networks, when shoppers use their cards and the fees go to the bank that issued the card. Read more

Payments giant Stripe launches support for crypto, NFTs - Stripe’s new crypto tools and application programming interfaces (APIs) enable businesses to accept fiat deposits for crypto and payout to users in local fiat currencies. The company also offers know your customer (KYC) solutions and other fraud prevention tools to crypto firms. Read more

FCA orders closure of all UK crypto ATMs - The UK's Financial Authority says that any cryptocurrency ATMs operating in the UK are doing so illegally and that they must be shut down. Read more

Select Financings


Argyle - New York based employment income verification company raised $55m in Series B funding led by SignalFire. Read more

Atlantic Money - London based money transfer company raised $5m in Seed funding led by Amplo and Ribbit Capital. Read more

AutoFi - San Francisco based auto financing company raised $85m in new funding led by Santander Holdings USA. Read more

Branch - Minneapolis based employee payment company raised $75m in Series C funding led by Addition. Read more

Capchase - New York City based recurring-revenue financing company raised $80m in Series B funding led by 01 Advisors. Read more

CredAvenue - India based business credit marketplace raised $137m in Series B funding led by Insight Partners, B Capital Group, and Dragoneer. Read more

Dash - Ghana based payments app raised $33m in Seed funding led by Insight Venture Partners. Read more

Disco - California based post-purchase cross-promotional network raised $20m in Series A funding led by Felicis Ventures. Read more

EthSign - Singapore based web3 infrastructure startup raised $12m in Seed funding led by Sequoia. Read more

Forma - California based discretionary benefits management platform raised $40m in Series B funding led by Ribbit Capital. Read more

Kado - New York based stablecoin payment infrastructure provider raised $5m in Seed funding led by Hashed. Read more

KurateDAO - New York based "curate to earn" database built on the blockchain raised $7m in Seed funding led by Polychain Capital. Read more

Lynx - Boston based healthcare payments, banking, and e-commerce platform raised $15m in Series A funding led by Obvious Ventures and .406 Ventures. Read more

Milo - Miami based provider of a crypto-backed mortgages raised $17m in Series A funding led by M13. Read more

Selfbook - New York based provider of hotel payment software raised $15m in Series A funding led by Tiger Global. Read more

Tabby - Dubai based BNPL company raised $54m in Series B funding led by Sequoia Capital India and STV. Read more

Thirdfort - London based fraud detection and identity verification company raised £15m in Series A funding led by Breega. Read more

WalletConnect - Switzerland based web3 infrastructure startup raised $11m in Series A funding led by Union Square Ventures and 1kx. Read more

Yuno - Colombia based payments company raised $10m in Seed funding led by a16z. Read more


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