Chipper Africa, a cross-border payments startup, announced on Wednesday it has raised a $100 million Series C round of funding led by Silicon Valley Bank’s investment arm SVB Capital, Bezos Expeditions, Ribbit Capital, Decidens Capital, and TymeBank. The company, which already had a substantial presence in Africa, plans to use the money to expand its product portfolio and employee headcount.
When Ham Serunjogi and Maijid Moujaled founded Chipper in 2017, they were just two young Ugandans with a big idea: to create an app that would allow Africans to send and receive money across borders. Their goal was to take advantage of the lack of liquidity in African markets, which made it difficult for consumers to move money between countries.
They decided to start off with a free, simple mobile app that allowed people to send and receive money between Uganda and Ghana. That first version, launched in July, enabled people to transfer funds between the two countries for free. But as the app gained popularity, Serunjogi and Moujaled realized that their users wanted more. So they added a virtual Visa card, launched a crypto product, and introduced money transfers to six other African nations.
In mid-2019, the startup launched in Nigeria and Rwanda. By the end of the year, it had 600,000 users and over three million active users. According to TechCrunch, Chipper’s user base grew 33% over the year. This week, the company closed its $100 million Series C round of funding, making it one of the top private African ventures.
With the new funding, the company will be able to expand its geographical reach and workforce by 50%. It is also planning to launch a US stocks product in Africa in the coming months. While the majority of its operations are in Nigeria, the company has also entered other African markets including Kenya, Rwanda, and Tanzania.
Among other things, Chipper has offered peer-to-peer payment services and is now expanding its offerings to the UK. In the meantime, it will continue to develop its product lineup and offer investing products. And, according to CEO Olugbenga Agboola, the company is aiming to be on the right side of the apex bank policies in each country where it operates.
Chipper Cash has become the latest African tech venture to raise more than $100 million. Two other startups, Flutterwave and OPay, have also raised large rounds of investment this year. Despite the high stakes, however, the fintech boom is still relatively young in Africa. There are about 605 million registered mobile money accounts in sub-Saharan Africa, and these can be used to transfer cash via text message.
The financial inclusion boom in Africa continues to drive investment, especially in the fintech space. According to CB Insights, in 2018 African fintech companies received $1.5 billion in investments. As more people use smartphones and digital literacy increases, the boom is expected to continue. However, even with the increase in funds, funding gaps remain. Because of this, it is crucial for companies to be able to cover the costs of operating in each African country.