Stripe and Visa join $8m funding round in African start-up Paystack
Nigeria-based payments start-up Paystack has raised $8 million in Series A funding.
The round was led by Stripe, and includes Visa, follow-on funding from Tencent and Y Combinator, as well as angel investors Tom Stafford (managing partner at DST Global), Gbenga Oyebode (founding partner of Aluko & Oyebode and board member of MTN Nigeria), and Dale Mathias (co-founder, Innovation Partners Africa).
This brings Paystack’s total investment to date to more than $10 million. Existing investors include Comcast Ventures Catalyst Fund, Blue Haven Ventures, and Ventures Platform.
Shola Akinlade, CEO and co-founder of Paystack, says: “We think of Paystack as an amplifier of the incredible work that African business owners are already doing. With better technology tools, African businesses can be better equipped to play a growing role in the global economy.”
“Africa is central to Visa’s long-term growth strategy, especially when you consider how cash is still a primary payment option for millions on the continent,” adds Otto Williams, head for strategic partnerships, fintechs and ventures for Visa in Central and Eastern Europe, Middle East and Africa (CEMEA).
Paystack will invest the new round of funding in scaling its engineering team, improving its payments infrastructure, and looking for expansion across the continent.
According to the start-up, within two years, its all-African team has grown to process nearly 15% of all online payments in Africa’s largest economy (i.e. Nigeria), powering tens of thousands of businesses of all sizes including telcos, airlines, and government agencies.
Paystack provides APIs to help developers build payment solutions online.
Via lines of code, developers can create custom checkout options, build automated recurring billing systems for subscription products, send bulk transfers to any bank account in Nigeria, and verify the identity of customers through five different verification APIs.
Customers can pay with local and international cards, or directly from their bank accounts. Paystack also supports localised payment channels, including mobile money, QR code, and USSD payments.
Launched in January 2016 by Akinlade and Ezra Olubi (CTO), Paystack was the first Nigerian company to be accepted into Y Combinator. The company is headquartered in Lagos.