Nigeria: Flutterwave rolls out new services to live up to $3bn price tag

By Ruth Olurounbi
Posted on Thursday, 24 February 2022 12:45

A man poses as he displays the Flutterwave homepage on a mobile phone screen in Abuja, Nigeria January 21, 2020. REUTERS/Afolabi Sotunde

Nigeria's Flutterwave became - at $3bn - Africa's highest valued startup after its latest financing round. To justify the price tag, it is rolling out a suite of new services, including FaaS, or Fintech as a Service, and also a new white label platform to allow other companies to issue virtual and physical debit cards.

Flutterwave will be introducing new products and services “that take the technology leader beyond payments,” the company said last Friday.

“We’re growing and for us, payments have become a means to an end. Our new identity is a system that recognises how far we’ve come in our mission. It gives us space to include all of our dreams and aspirations for businesses and customers.

“It gives us the freedom to do and be more. We’re excited for this new chapter in our growth,” tech company Olugbenga GB Agboola,  founder and CEO, said at a virtual event introducing “Flutterwave 3.0”.

Flutterwave became Africa’s most valuable startup after it raised $250m in Series D funding giving it a $3bn valuation. To justify that price tag, new services will include “fintech as a Service (FaaS) solution as well as a card issuing technology platform that will allow businesses to issue both Mastercard virtual and physical debit/prepaid cards to their customers in partnership with Mastercard.

Andela ($1.5bn), Interswitch ($1bn) and Esusu ($1bn) follow Flutterwave as the most valuable startups founded by Nigerians. Softbank-backed Esusu, a tech company that provides rent reporting and data solutions for credit building for immigrants; and was co-founded by Nigerian Abbey Wemimo and Indian Samir Goel became the most recent unicorn late in January when it raised $130m series B funding.

Interswitch, an integrated digital payments and commerce company achieved unicorn status in 2019 after a $200m equity investment by Visa gave it a $1bn valuation. A tech company that connects engineering talent in emerging markets to global companies, Andela, raised a total of $38m in funding in multiple rounds to bring the company’s valuation to $1.5bn in September last year.

Flutterwave’s help to startups

While Flutterwave’s newly added “solutions remain subject to regulatory approval”, according to the tech company via a statement, if approved, Flutterwave’s fintech as a service product will help “startups of all sizes quickly become Fintech companies using Flutterwave’s pre-built API and solutions,” it said.

The idea behind FaaS, according to Olumide Adesina, an analyst at Quantum Economics is to help businesses, especially SMEs, to scale quickly and remain agile.

“The goal is to help companies by quickly building, deploying, and extending apps by letting others manage the entire server environment where code can run. Additionally, the technology allows for scaling. With FaaS, your cloud service provider manages all physical hardware, virtual machine operating systems, and web server software for you. You can therefore concentrate solely on your business,” he says.

The tech company “allows other companies to connect to its application programming interface (API) and also conduct services like white-label e-wallet platforms, card issuing, payment acceptance, payouts and remittances, identity verification, fraud prevention, virtual accounts and merchant services, as well as solutions for provisioning, managing and reporting,” Dr Samuel Segun, Product Manager – Machine Learning at Praelexis AI in South Africa, said by phone.

Global companies to join

Flutterwave joins global companies such as London-based Rapyd to provide FaaS as it seeks to consolidate money movement services in Africa. “Every part of our lives includes some form of transaction. Beyond powering those transactions, we want to also create those transactions.

“We want to help event organisers seamlessly register and sell out their events, we want to help artists receive money for their craft, we want to help entrepreneurs incorporate their businesses, we want to help startups build financial technology products easily and we want to create endless possibilities for all through technology,” Agboola said.

Flutterwave says it is also introducing Capital, a technology platform for businesses and consumers to access Buy Now Pay Later (BNPL), and a B2B product that helps entrepreneurs easily incorporate their businesses globally, called Grow. It says it is introducing “Checkout”, a new “experience that is five times faster, reducing drop-off by 60%”.

‘Over 200 million transactions’

The latest fundraise comes after Flutterwave processed over 200 million transactions worth over $16bn to date across 34 countries on the continent Africa in five years. It also follows a year of rapid growth for the brand which now serves over 900,000 businesses across the globe.

It will be recalled that last year, Flutterwave launched a range of new products including Flutterwave Market for merchants to sell their goods via an online marketplace and, most recently, Send, a remittance service that empowers customers to seamlessly send money to recipients to and from Africa. The company also partnered with leading global and pan-African technology and telecommunication companies such as PayPal, MTN, Airtel Africa to drive financial inclusion on the continent.

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