Jake Bright6 years
Jake Bright is a writer, author and advisor with a focus on global business, politics, and technology.
From 2017 to 2020, he was a contributing writer and advisor at TechCrunch where he published on Africa, mobility and politics. Bright helped spearhead consistent Africa coverage and co-produce the first Startup Battlefield competitions in Africa and Africa focused programming on the Disrupt San Francisco mainstage.
Bright’s first book, The Next Africa (Macmillan 2015), forecast the rise of Africa’s venture backed startup scene. Prior to this he worked in international finance and as a speechwriter in Washington, DC. Bright continues to contribute occasional guest pieces at TechCrunch.
More posts by this contributor
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Forty-seven and a half million dollars is a big commitment to African technology companies — even with the recent uptick in VC investment on the continent.
But for the Kenyan-based fintech firmCellulant,whose digital payments platform processed 7 million transactions worth $350 million across 33 African countries in the last month alone, raising that amount in a series C round led byTPG Growth’s Rise Fundjust makes sense.
In 2017, the company processed $2.7 billion in payments, saidchief executive, Ken Njoroge.
Clients include the continent’s largest banks: Barclays Bank, Standard Chartered, Standard Bank, and Ecobank. Cellulant also has multiple revenue streams and is EBITDA positive, according to its CEO.
So what does an African technology company do with $47.5 million? “The round is to accelerate our growth of around 20 percent…north of 50 percent,” said Njoroge. “Most of the investment is to scale out our existing platform in Africa and build usage on our existing network.”
Founded in 2004, Cellulant offers Person-to-Business,B2B, and P2B services on its Mula and Tingg products. It’s also developing a blockchain basedAgrikoreproduct for agriculture related market activity.
On Africa’s digital payments potential, “We’ve built internal value models that estimate the size of the market at somewhere between $25BN and $40BN,” said Njoroge.
He differentiates Cellulant’s focus fromSafaricom’s M-Pesa –one of Africa most recognized payment products — by transaction type and scope. “Kenya’s M-Pesa is optimized as a P2P platform in a few African countries. We’re optimized as a P2B platform and single pipe into multiple countries across Africa,” he said.
One of those countries is economic and population powerhouse Nigeria — where Cellulant offers both itsTing and Agrikore apps. Nigeria is also home to notable digital payment companiesPagaand Interswitch, the latter of which has expanded across Africa and is considered acandidate for a public offering.
On a future Cellulant initial public offering, “it’s too early,” said Njoroge. But he doesn’t rule it out. “When you look at the size of the payments business, you could say we have fairly strong prospects to go in that direction.”
TONY KARUMBA/AFP/Getty Images
Meanwhile, the Nigerian investment startupPiggybank.ngclosed $1.1M in seed funding and announced a new product — Smart Target, which offers a more secure and higher return option forEsusuorAjogroup savings clubs common across West Africa.
The financing was led by a $1 million commitment fromLeadPath Nigeria, withVillage CapitalandVentures Platformjoining the round.
Founded in 2016, Piggybank.ng offers online savings plans — primarily to low and middle-income Nigerians — for deposits of small amounts on a daily, weekly, monthly, or annual basis. There are no upfront fees.
Savers earn interest rates of between 6 to 10 percent, depending on the type and duration of investment, Piggybank.ng’s Somto Ifezue explained in thisTechCrunch exclusive.
The startup generates returns for small-scale savers (primarily) through investment in Nigerian government securities, such as bonds and treasury bills.
Piggybank.nggenerates revenue through asset management and fromthe floatits balances generate at partner banks.
The Lagos based startup will use its $1.1M in new seed funding for “license acquisition and product development,” according to company COO Odunayo Eweniyi.
Piggybank.ng looks to grow clients across younger Nigerians and the country’s informal saving groups and has taken preliminary steps to launch in other African countries.
Lead investor andLeadPath Nigeriafounder Olumide Soyombo was attracted to Piggybank.ng as an acquisition target.
“The banks have been slow to try new things in this savings space. Piggybank is coming in…and filling a particular need, so they are in a very acquisitive space.”
PIUS UTOMI EKPEI/AFP/Getty Images
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