Stripe acquires Nigeria’s fintech firm Paystack to expand its business in the African Continent
US-based payment technology firm Stripe has acquired Nigerian payment startup Paystack. The acquisition is in a bid to accelerate online commerce across the African continent. Terms of the deal have yet not been disclosed there are speculations that it is over USD 200 million. This makes it the biggest startup acquisition to date in Nigeria, as well as Stripe’s biggest acquisition to date anywhere.
Despite the acquisition, the Nigerian fintech company will continue to run its business independently, expand its operations in Africa.
The deal underscores two fascinating factors about Stripe, now valued at USD 36 billion and frequently tipped as an IPO candidate. First is how it’s doubling down on geographic enlargement, along with progressive feature expansion. And second is how Stripe is placing a guess on the rising markets of Africa particularly in the way forward for its progress. Stripe has expanded to 17 countries in the last 1.5 years.
Stripe alongside Visa, Tencent, and Y Combinator, was also a part of the USD 8m Series A funding round of the Nigerian fintech firm in August 2018.
Paystack was founded by Shola Akinlade who is the CEO and Ezra Olubi who is the CTO. Presently Paystack has around 60,000 clients, including small companies, larger corporates, fintech, instructional institutions, and on-line betting corporations.
CEO Shola Akinlade stated. “For Paystack, the deal will give the corporate a lot more funding to build out additional in Nigeria and broaden to other markets.”
In the last several years, Stripe has made a lot of investments into startups building know-how or businesses in areas the place Stripe has but to maneuver. This year, those investments have included backing investment in common checkout service Fast and backing the Philippines-based cost platform PayMongo. In 2018, Stripe led the USD 8 million Series A funding round in Paystack.
In general, doing business in Africa requires significant on-the-ground expertise. For Stripe, Paystack brings 60 thousand users and gives it a toehold on the continent, which is projected to have half the world’s population by 2050. While Nigeria is the continent’s biggest economy, it is also the most corrupt per Transparency International. However, these troubles proceed to be worked upon and hopefully ultimately resolved.
Paystack’s acquisition is a notable foil to these themes. Akinlade stated, “Most of what we shall be building in Africa has not been built yet.”