Chipper Cash: American network, African success

In depth
This article is part of the dossier: Top 50 tech champions

By Kévin Poireault
Posted on Friday, 29 April 2022 16:17

Having raised $250m and earned itself unicorn status, the fintech firm, which owes its success in part to its founders' close proximity to Silicon Valley, had a wild 2021.

This is part 5 of an 11-part series.

Ranked as one of the startups to watch in 2021 by media like Techgist Africa, African Vibes and the influencer Alex Mitchell, Chipper Cash has delivered. As the business world slowly recovers from a two-year pandemic, the international money-transfer startup, founded in 2018 by Uganda’s Ham Serunjogi and Ghana’s Maijid Moujaled, has been steadily making headlines.

In May 2021, it raised $100m in a funding round led by SVB Capital, which “probably” made it “the most highly valued African start-up”, according to its CEO Ham Serunjogi, who did not reveal the amount of this valuation. Even if his statement left some sceptical, the $150m Series C round in November, this time led by FTX, the cryptocurrency exchange platform of the world’s youngest billionaire, Sam Bankman-Fried, proved the Ugandan CEO right, as Chipper’s valuation had by then reached $2bn.

The startup has officially become Africa’s fourth unicorn of the year, and the sixth in the continent’s history. “It’s an important step, but I think some people are focusing a little too much on the valuation,” Ham Serunjogi said during a virtual roundtable organised by MTN South Sudan in November.

California road trip

The former professional swimmer – who prefers to measure his success “by the longevity” of his startup rather than its short-term performance – used the funds raised to expand into the United Kingdom in May 2021 and the United States in October of the same year. Chipper Cash is now present in nine countries, including seven in Africa (Ghana, Nigeria, Rwanda, Uganda, Kenya, Tanzania and South Africa).

One of the specificities of Chipper Cash’s fundraising, which today amounts to more than $302.2 million, lies in the nature of its investors. Among them are SVB Capital, FTX and Deciens Capital, the latter of which led a seed round in 2019 and has participated in three other funding rounds since – and even Bezos Expeditions, the personal fund of the founder and owner of Amazon, which has been funding Chipper since 2020. None of these investors had previously shown interest in Africa. It is thanks to their American network that Ham Serunjogi and Majid Moulaed managed to finance their start-up’s growth.

This location close to Silicon Valley is definitely a factor in Chipper Cash’s ability to raise money so quickly.

Chipper Cash’s adventure began far from the continent, when the two founders met in the US state of Iowa back in 2013. During a road trip to California, they talked about starting a project together. As the miles passed, with podcasts on fintechs and cryptocurrencies playing in the background, they decided to launch a money transfer solution. “Not just sending money from Western countries, since it already exists, but also between African states,” Ham Serunjogi says.

Consolidation

Two years later, after a stint at Facebook in Dublin, Ham Serunjogi joined Maijid Moujaled, who worked for Imgur in San Francisco. Together, they founded Chipper Cash from the California Bay Area, following in the footsteps of Nigerian Olugbenga Agboola, aka “GB”, whose fintech Flutterwave is also registered in San Francisco. “This location close to Silicon Valley is definitely a factor in Chipper Cash’s ability to raise money so quickly,” says Dario Giuliani of British research firm Briter Bridges. “More than half of the money poured into the top 10 African startups in the last three years has come from the US.”

In this conquest of the West, the boss can count on Nigerian singer Burna Boy, who has also made the US market a major target and whose services Serunjogi has engaged as an ambassador. But if 2021 was a funding year for Chipper Cash, 2022 will be the year of consolidation. In addition to its interstate transfer solution, which offers more than 4 million users fees hovering at 5%, compared to 10 or 15% with remittance solutions (MoneyGram, Western Union, WorldRemit…) and nearly 30% with traditional banks, the startup is developing a handful of new products, such as Chipper Checkout, a payment service for professionals, Visa cards or solutions to invest in the stock market or in cryptocurrencies.

‘Huge’ potential for cryptos

On this topic, the CEO remains cautious: “Cryptos represent a huge potential for African fintech, but we want to integrate them into our products in a safe way in compliance with regulations,” he said at the roundtable organised by MTN. This is why Chipper’s crypto service, limited to bitcoin, is unavailable in Nigeria, where it would be outlawed.

Ham Serunjogi wants to use Chipper Cash’s financial success – frequently cited as a role model – to help expand the African start-up ecosystem: “I wish I had known when I started my career the importance of having a strong network. That’s why, with Chipper, we’re going to invest more and more in African entrepreneurs who haven’t had the chance to access capital as easily as we have.”

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