$360M for Interswitch! Big news for the whole continent <3
Recently I published summary of African FinTech investments in last 3 quarters. And.. 4th quarter will double the size of investments in the continent! Nigeria (arguably) became Africa’s unofficial capital for Fintech investment and digital finance startups.
The November saw $360 million invested in Nigerian-focused payment ventures - Interswitch. That is equivalent to roughly one-third of all the startup VC raised for the entire continent in 2018, according to Partech stats, not mention that it is more than 3 previous quarters raised in the continent in FinTech sector, together!
A notable trend-within-the-trend is that more than half — or $170 million — of the funding to Nigerian fintech ventures in November came from Chinese investors.
Interswitch confirmed its $1 billion valuation after Visa took a minority stake in the company. Interswitch would not disclose the amount to TechCrunch, but Sky News reporting pegged it at $200 million for 20%.
Founded in 2002 by Mitchell Elegbe, Interswitch pioneered the infrastructure to digitize Nigeria’s then predominantly paper-ledger and cash-based economy.
The company now provides much of the tech-wiring for Nigeria’s online banking system that serves Africa’s largest economy and population. Interswitch offers a number of personal and business finance products, including its Verve payment cards and Quickteller payment app.
The financial services firm has expanded its physical presence to Uganda, Gambia and Kenya.
Visa and Interswitch touted the equity investment as a strategic collaboration between the two companies, without a lot of detail on what that will mean.
A source close to the matter (cited by TechCrunch) said the company will list on a major exchange by mid-2020. For the near to medium-term, Interswitch could stand as Africa’s sole tech-unicorn, as e-commerce venture Jumia’s volatile share-price and declining market-cap — since an April IPO — have dropped the company’s valuation below $1 billion.