Flutterwave: The Making of the African Unicorn

The fintech revolution is a pedestal for online retail in the African continent and the firm in the ecosystem charting the course is Flutterwave. Digital payment awareness is gaining momentum in the continent and Flutterwave is providing a platform for merchants to do their business digitally without bottlenecks. The young firm has created a bridge for businesses to do business digitally through its innovative platform. It is practically unachievable to receive funds from PayPal in some African countries but Flutterwave came with a truly Pan African concept by partnering with PayPal to boost digital payments in countries with insufficient financial regulations and weak banking security.

This unpalatable experience might be over for African businesses by the announcement of the collaboration by Flutterwave with PayPal. This enduring relationship would allow PayPal customers globally to do business with African merchants effortlessly through its “Pay with PayPal” platform. The alliance with PayPal would prompt African businesses to connect with over 377 million PayPal accounts globally. The milestone collaboration commands a thorough resilience against the digital payment challenges and a weak banking infrastructure on the continent.

This innovative posture by Flutterwave shall unlock collaborative expression PayPal offers which is more than 300million PayPal users connecting with African merchants through payments in the continent. Flutterwave’s mission of simplifying digital payments for the customers is achievable though the possibility shall be challenged by government’s policies of high uncertain regulations that tend to box innovation. The rapid growth of fintech services in the continent is good news for investors despite the fickle regulations by bureaucrats. The opportunities fintech service providers present would continually get bullish, increase the GDP and boost FDI.

The unicorn status of Flutterwave took the industry by surprise, the company just announced that it has closed a deal of $170M increasing the firm’s valuation to $1Billion.This valuation makes Flutterwave an African payment giant. Launched in 2016 as a Nigerian and U.S based company with offices in Lagos and San Francisco, Flutterwave aid businesses to build tailor-made payment applications via its APIs. Recently Flutterwave processed over 140million worth of transactions which was more than $9Billion. Flutterwave has grown leaps and bounds according to the CEO; the company’s revenue has grown more than 100% year on year without the company releasing the financial details.

The compound annual rate growth (CAGR) of 226% since 2018 is investors’ delight. The awareness it brought to e-commerce platforms is improving digital payments across the continents. Flutterwave has more than 290,000 customers that use its platform and more businesses are getting aware of the great opportunities it offers. Flutterwave’s reaction to Covid 19 was creating Flutterwave store for businesses which dominated 15 African countries aiding over 20,000 firms to create business windows and sell their products digitally. Flutterwave’s desire of becoming a global digital payment was prompted by the commitment of investors through Series of investment by investors. The company has been able to raise $225million which shows investors confidence in a startup that is just 6years.

According to the CEO’s assertions that the company is already present in 20 African countries with an existing structure in over 33 countries in the continent. The other fintech company that has certainly scaled to a unicorn status like Flutterwave is Interswitch which had 20% of its equity acquired by Visa in 2019. Flutterwave and Interswitch are the only fintech companies in Nigeria which has $1Billion valuations. The giant stride of fintech and e-commerce growth in Africa has customers’ confidence in digital payments. The digital firms are the vanguard in the fintech and e-commerce progress in Africa. The valuation status fintech and e-commerce firms have enjoyed in Africa shows that digital payment has a financial momentum in the continent. Flutterwave, Interswitch, Jumia and Fawry an Egyptian payment firm have all reached the $1Billion valuation status.

Revenue, customer growth and retention is always the driving motivations of enduring valuations which most start-ups have exhibited in the continent. Looking into the future more companies shall have unicorn valuations in Sub-Saharan Africa. Three Nigerian companies have created the path and model for aspiring entrepreneurs to dream big.

Africa needs more entrepreneurs to unlock the potentials of the continent. The politicians should know that creating the desired environment is the right policy to implement. Technology should be the foundation of the continent’s economic rejuvenation. The young population of the continent would do better if the right policies were put in place for budding entrepreneurs. Flutterwave has shown in short time that Africa is the next thing when it comes to tech entrepreneurship.