CEO of Flutterwave, Mr. Olugbenga Agboola, speaks about how the company’s $250 million fund raiser deal will enhance the growth of business, innovation and technology landscape in Africa. Emma Okonji presents the excerpts:
Flutterwave recently secured $250m in Series D Funding, which raised its valuation to over $3bn. What does this new deal portend for Flutterwave and its customers?
Our focus remains on growing the business, expanding our presence and enhancing our customer base. This major investment will enable us to deepen market penetration for our existing products and extend the stickiness of our digital payment services for merchants and customers as we continue to execute on our strategy over the next few years.
With the new fundraise; Flutterwave becomes the highest valued African startup. How will the new investment enhance the growth of business, innovation and technology landscape in Africa?
The fundraise will help showcase our transition from predominantly two key products to a suite of products. We also aim to grow our customer base, specifically driving our small and medium enterprises (SME) base to serve at least a million SMEs by the end of 2022.
How do you intend to spread the money across all your operations and what percentage of it will be dedicated to African tech development?
We intend to use the proceeds to deepen our presence in the territories we currently operate. We hope to drive adoptions for the products unveiled at our Flutterwave 3.0 event. We are also aiming for customer acquisition in both international and domestic markets. We will continue to provide support to the tech ecosystem in Africa by providing needed technology and resources to enable growth.
Can you expatiate more on Flutterwave investors, the nature of their investments, and the duration of their investments before returns on investments?
Our Series D fund raise was led by B Capital, with participation from Alta Park Capital, Whale Rock Capital, Lux Capital, among others. Several existing investors who had participated in previous rounds also followed, including, Glynn Capital, Avenir Growth, Tiger Global, Green Visor Capital and Salesforce Ventures. We are glad to have partnered with investors who share our vision and can add value to the business with their industry relationships, experience and networks.
Shortly after the announcements of the latest fundraise, Flutterwave launched version 3.0 at a virtual event. What is it all about and how will it enhance customers’ experience?
At Flutterwave 3.0, we announced a rebrand of our visual identity and mission. In addition to improvement on existing products, we introduced Flutterwave Capital – a lending service, Grow – for ease of business incorporation globally, and a Fintech as a Service (FaaS) solution which helps other startups become fintech easily. All of these are subject to regulatory approvals. Flutterwave is on a mission to create endless possibilities for customers through technology.
As a Nigerian tech startup with about six years experience, how will you describe the growth of tech startups in Nigeria and the rest of Africa?
Over the years, fintech companies have made it easier for businesses and individuals to send and receive money, make and receive payments, save, invest and even obtain loans. A few years ago it was difficult to trade across African borders, today Flutterwave is making that possible. The growth of tech startups across Africa is a validation of African talent and grit – an evidence of what young people can do when given opportunities like technology.
Having risen high to become the highest valued African startup, what are your plans to help develop up-coming startups who need mentorship and direction to succeed?
This is one of the reasons why we developed the Fintech as a Service (FaaS) solution. This solution is to provide the API infrastructure needed for building other Fintech businesses for free. That way we can help the next Flutterwave get there faster and easier.
Startups are full of ideas, but 95 per cent of such ideas do not come out successful. Could you share some of your challenges and the resilience you established to bring Flutterwave to limelight?
Challenges build resilience and force innovation. Building infrastructure in 34 African countries is not a walk in the park – you are operating across markets and borders, each with its own regulations and peculiarities. It is why we had to strengthen our bench of talents to match excellent delivery. For example, when we appointed Oluwabankole Falade as our Chief Regulatory Officer, as we realised the increasing need for support; or with the hire of Jimmy Ku who is helping us drive our growth in developed markets.
What are some of the lessons to draw from your six years’ journey as a tech startup?
From serving our customers over the years, we have been able to identify their pain points and have used this knowledge to improve and elevate their experiences. We have also been able to collect data that gives us valuable insights, which we have used to grow our transaction channels and create solutions to connect Africans to the world and the world to Africans
Large chunk of investments in African tech startups come from outside of Africa. What could be responsible for this, given the fact that African countries, including Nigeria still have credible VCs and Angel Investors that are willing to invest their money?
There are notable Venture Capitalists (VCs) firms in Africa who are providing the early capital that businesses need to get off the ground. Their yardstick for investing is similar to larger VCs outside of Africa as any investor wants to know if the business idea is sustainable and scalable. Africa’s population and drive towards building and growing its digital economy, presents a market opportunity for startups with viable solutions, not just to solve economic problems but also run profitable businesses. Investors within and outside Africa know this and see it as well.
Majority of tech startups focus more on developing solutions for the payment industry, leaving out other areas that are also important to national growth like education, health, real estate, hospitality, among others. Why the tilt towards the payment industry?
Actually, there are many startups operating in Meditech, Edutech, Agritech, Insuretech, among others – all of them solving various problems and contributing to the national economy using tech. The issue might be that people don’t get to hear their stories all the time, like they do fintech startups. Fintech companies like Flutterwave are able to process payments and other transactions because there are other companies and small businesses doing amazing things across various industries.
The growth of startups in the payment industry has revolutionised financial transactions, making it easier for financial institutions to offer varieties of digital and online services to their customers. How can this development be sustained in the coming years and what is the current relationship between the banks and the financial technology solutions providers like Flutterwave?
I must say that the Central Bank of Nigeria, under the leadership of Mr. Godwin Emefiele, laid the vision of a transformational payment system in Nigeria. He provided the framework for innovation in this space, and has continued to create regulations that have enabled us to grow and thrive. We are grateful to them and to all the other Central Banks in all the countries where we operate.
Today, we are also witnessing greater collaboration between banks, fintechs and other players in the ecosystem pulling their weights to ensure seamless payments and collection experience for customers and merchants. To sustain this progress, private and public sector institutions must continue to collaborate to operate a business environment that enables and supports growth.
Given the growth trajectory of Flutterwave, could you share the number of transactions carried out on your platform since inception, the value of such transactions and how you intend to grow the brand across the globe?
So far, Flutterwave has processed over 200 million transactions worth over $16 billion across 34 countries in Africa. We are already experiencing rapid growth, as we serve over 900,000 businesses and counting across the globe. We aim to serve one million small and medium enterprises by the end of 2022 and we might explore inorganic growth opportunities through mergers and acquisitions.
Could you share the details of Flutterwave product solutions and their impact on customers?
During our Flutterwave 3.0, we launched A Fintech as a Service (FaaS) solution, which helps startups of all sizes quickly become Fintech companies using Flutterwave’s pre-built Application Programming Interface (API) and solutions. Flutterwave Capital, gives businesses and consumers access to Buy Now Pay Later (BNPL) products and access to credit. Grow, is our B2B product that helps entrepreneurs easily incorporate their businesses globally. Our Card issuing platform enables businesses to issue both Mastercard virtual and physical debit/prepaid cards to their customers in partnership with Mastercard. All these are in addition to our existing products.
Being one of Africa’s fastest-growing Unicorns, what are your expectations and goals?
Since inception in 2016, our goal has been to create endless possibilities for customers and businesses in Africa and the emerging markets. This is what we have been doing and will continue to do- connecting emerging markets to global economies. We will continue to deepen our presence in the territories we have operations, while innovating on new products and services.