News
South African API startup Stitch raises $21M in series A
- Stitch, an API infrastructure company that enables simple, easy access to user financial accounts, has raised $21M in a Series A funding round for its API infrastructure & embedded finance platform.
- Launched in South Africa in early 2021 and expanded to Nigeria in October 2021, Stitch makes it easier for businesses across Africa to build, optimize and scale financial solutions.
- Founded by Kiaan Pillay, Natalie Cuthbert, and Priyen Pillay, Stitch plans to create a “financial graph” ecosystem across Africa with the new funding.
Available finance continues to be a significant theme in the world of fintech as businesses tap APIs to access customers’ financial accounts and provide a gamut of integrated and embedded financial services. In the latest development, Stitch — one of the prominent players building and operating these APIs in Africa — confirmed to TechCrunch that it has raised $21 million in Series A funding.
This news follows the $4 million Stitch raised out of stealth in February 2021, a prequel to the $2 million extensions round it secured four months ago, bringing its seed round to $6 million. In total, Stitch has raised $27 million to date.
The South African API fintech enables businesses to build, optimize, and scale financial products. Per a statement released by the company, it plans to create a “financial graph” ecosystem across Africa with the new funding.
The company describes the financial graph as an infrastructure for financial building blocks that allow businesses to write code once, launch in multiple markets and scale faster based on interoperability across regions, providers, banks, and other types of financial accounts.
“We sort of view the broader financial ecosystem as a bunch of different nodes–bank accounts, merchants such as fintechs or end-users–which are all intrinsically connected,” Stitch CEO Kiaan Pillay said to TechCrunch in an interview. “Often, we think about the fact that these connections between geographies and institutions don’t exist yet. And a lot of what we try to do is to bridge those connections and to make those connections ubiquitous.”
Stitch views this graph in three stages. The first is what it launched from stealth: the pure infrastructural play of connecting financial and bank accounts with an API. The second seeks to acquire merchants and businesses to build use cases and applications on top of that infrastructure. And the last is getting end consumers to link their accounts via these businesses.
“On the high level, people moving from cash to digital for the very first time causes more fragmentation. Our view is that encompassing this all in one network or graph helps to open the space up and break down the silos,” said Pillay. “And the way we ultimately think about that is that people can easily move money between various applications between various geographies and institutions.”
Stitch provides solutions for e-commerce companies, marketplaces & platforms, and its leading clientele, fintechs. As with other years, African fintechs outperformed other startups in raising venture capital, particularly in a record-breaking 2021 where they raised 50-60% of total VC funding per reports.
Their importance can’t be overstated, and infrastructural players such Stitch, Mono, Okra, Plaid, and OnePipe —all who raised money within the past year, some in seed and others, Series A — are pivotal to that collective growth of driving financial inclusion and ease of payments across the continent.
These business customers use Stitch for use cases such as KYC & onboarding, personal and business financial management, lending, wallet top-ups, and e-commerce checkouts. The platform’s data and identity products allow businesses to access customer transaction histories and balance data, verify account information, and perform fraud checks. The payments product enables bank-to-bank transfers for one-click pay-ins and payouts.
Some customers include wallet-based companies such as Chipper Cash and Luno; embedded finance providers like ImaliPay; subscription platforms like FlexClub; and payment aggregators like Yoco.
In April 2021, Stitch launched its payments product in South Africa and noticed a 50% month-on-month growth in payments volume the following six months. In October, Stitch expanded the payment product to Nigeria and, at the time, was on track to facilitate $10 million in monthly payments by December.
On the call, Pillay, who co-founded Stitch with Natalie Cuthbert and Priyen Pillay, didn’t give any update on this metric but said Stitch had seen a 104% month-on-month growth in payments value since launching the product last April. And in Q4 2021, the platform witnessed a 44% month-on-month customer growth and a 72% month-on-month increase in linked financial accounts.
“We’re proud of the partners and customers we have here as we continue to deepen the payments product and look at monthly and recurring payments, which are interesting feature sets for us,” said Pillay.
“We recently had a few customers go live in Nigeria, which has been very exciting for us. We offer payments there but are eager to deepen the products. We will look at adding data and identity this year, as well as deepening the payments set similarly to how we have it in South Africa.”
New York-based long-term investment firm The Spruce House Partnership led this round of funding. The round also welcomed participation from new and existing investors like PayPal Ventures, TrueLayer, first-minute capital, The Raba Partnership, CRE Venture Capital, Village Global, as well as fintech founders and companies such as TrueLayer, founders of Chipper Cash, Quovo and Unit, and Guillaume Pousaz’s Zinal Growth.
“We have been following startups in Africa for many years. Our diligence was very clear that this is one of the most talented teams on the continent, and we are excited to be a part of what they are building at Stitch,” said Ben Stein, co-founder of The Spruce House Partnership.
Pillay says raising money from VC firms and operators that have scaled fintech products across multiple geographies gives the company “something pretty special” as it enters its next growth phase. The funding, Stitch said, will allow it to expand its team across offices in Cape Town, Johannesburg, and Lagos, launch new product offerings, and enter new markets across the continent.
Lendo, a Saudi Arabia-based Shariah-compliant crowdlending marketplace, has signed a Memorandum of Understanding (MOU) today with J.P. Morgan to improve access to financing for small and medium-sized enterprises (SMEs) across the country.
The MOU was signed during 24 Fintech, a premier fintech event that brings together industry leaders, innovators, and investors in Riyadh.
J.P. Morgan and Lendo are working together on potential opportunities to support the SME sector in Saudi Arabia in growing and sustaining the remarkable demand in this market.
“This strategic collaboration with J.P. Morgan, a pioneer in the financial industry, marks a significant milestone for Lendo,” said Osama Alraee, CEO and co-founder of Lendo. “By combining our strengths, we’ll deliver cutting-edge financial solutions to SMEs, supporting their growth and contributing directly to the realization of Saudi Arabia’s Vision 2030.”
The SME financing landscape in MENA presents a substantial market opportunity as limited financial access continues to restrict the growth of the region’s businesses, with commercial banks hesitant to issue loans to SMEs at scale, resulting in a high percentage of declined financing requests annually.
The total SME financing gap in developing countries is estimated to be approximately $5.2 trillion, according to the International Finance Corporation (IFC).
Lendo’s debt crowdfunding platform aims to bridge the financing gap for SMEs, aligning with Saudi Vision 2030’s goal to significantly expand SME lending from 4% in 2018 to 20% by 2030.
According to the latest available report from the Saudi Central Bank (SAMA), the total value of debt crowdfunding in Saudi Arabia surged from SAR 1.4 million in 2019 to SAR 771 million in 2022, marking a remarkable growth.
Lendo raised SAR 132 million ($35.2 million) in total funding from leading investors, including the most recent Series B led by Sanabil Investments, a wholly-owned company by the Public Investment Fund (PIF).
Since its inception in December 2019, Saudi fintech Lendo has processed over 5,000 financing transactions on its platform, providing over SAR 2 billion ($600 million) in financing to SMEs and generating SAR 280 million ($74 million) in returns for investors.
TA Telecom, a prominent player in the Middle East’s tech sector, has unveiled AnteThink, an AI-driven tool designed to enhance decision-making processes for individuals and businesses alike.
With a history of influencing the tech landscape through various initiatives, including advanced mobile solutions, high-volume payment platforms, and ventures in e-commerce, fintech, and analytics, TA Telecom has carved a niche for itself. Serving a vast user base of 40 million and processing an impressive 15 billion transactions across its platforms, TA Telecom has cemented its position as a tech industry leader, with some of its ventures achieving the status of Y Combinator companies.
Established in 2000, TA Telecom has emerged as a prominent player in the technology sector. With over 40 million users and processing 15 billion transactions annually, TA Telecom has made a notable impact. Recognized for its contributions by the Financial Times and featured on Deloitte’s list of fastest-growing tech companies in EMEA, TA Telecom is known for its adaptability and forward-thinking approach in the ever-evolving global tech landscape.
Sameh Ibrahim, CEO of TA Telecom, highlights the potential of AnteThink: “AnteThink reflects our commitment to leverage technology for practical impact. It aims to provide clarity and confidence in decision-making, whether in the professional or personal sphere. AnteThink is a tool that can empower startup founders, executives, and individuals to make more informed choices, alleviating the stress and uncertainty often associated with critical decision-making.”
Mostafa Ashour, CEO of Y Combinator-backed startup NowPay, shared his perspective on AnteThink: “AnteThink transformed our strategic planning, allowing us to explore various scenarios and prepare for different outcomes. It has strengthened our decision-making process, helping us navigate the complexities of the business landscape.”
AnteThink embodies TA Telecom’s commitment to innovation, focusing on supporting the startup ecosystem. The tool is tailored to help leaders and executives navigate the complexities of business management and strategic development by providing a clear picture of potential outcomes.
Key Features of AnteThink include:
1. Second Order Mode: Offering a comprehensive analysis of broader impacts, fostering a strategic mindset for long-term success.
2. Optionality Mode: Enabling detailed evaluation and comparison of different choices to ensure decisions align with strategic objectives and values.
3. Inversion Mode: Focusing on identifying and mitigating potential risks, thereby strengthening risk management strategies.
Credit: Antethink
AnteThink’s advanced AI technology aims to assist decision-makers with insightful analytics, offering guidance through the decision-making process.
Selina Bieber, the Senior Director of Global Markets at GoDaddy, has predicted a significant increase in Egypt’s e-commerce revenue. By 2028, it could reach $9.88 billion.
Godaddy is forming strategic partnerships and launching initiatives to help local entrepreneurs. These efforts align with Egypt’s digital transformation goals and its Vision 2030.
In an interview with the Arabic financial news “Amwal Al Ghad,” Bieber spoke about GoDaddy’s plans and how they match Egypt’s 2023 strategy. She highlighted the company’s aim to provide effective, easy-to-use digital tools and services. By 2024, GoDaddy wants to serve more customers in Egypt by making its digital tools more widespread.
The company is working closely with the Egyptian government, especially the Ministry of Planning. They are offering training programs to improve the digital skills of startups and existing businesses. GoDaddy’s services in Egypt include domain registration, web hosting, e-commerce solutions, and digital marketing tools.
Recent surveys support Bieber’s positive outlook for e-commerce in Egypt. They show a clear trend towards digital strategies among small businesses. Many are realizing the importance of having an online presence for their growth and success.
As GoDaddy continues its partnerships and supports government digital initiatives, its influence on Egypt’s digital landscape is growing. The company is committed to sustainability and reducing its carbon footprint. It aims not just for business growth but also to contribute to a sustainable and thriving digital economy in Egypt.
The 2028 projection indicates a vast potential for e-commerce, with GoDaddy playing a key role in this digital evolution.
-
Startups9 years ago3 Creative Egyptian Women Who Master E-commerce
-
News9 years ago11 Talented Egyptian Photographers on Instagram
-
Campaigns8 years agoVodafone Egypt Brings Generations Together, Unlocks 4G Power
-
Marketing8 years agoWhich categories will suffer most from increased prices in Egypt?
-
Apps8 years agoRadio Garden Live Map of The Globe’s Radio Stations
-
News8 years agoTop 10 Egyptian Fashionistas to Follow on Instagram
-
Campaigns8 years ago7 Big Stats That Show Which Ramadan Advertisements Resonated Most
-
Opinion8 years agoF*** Being a Founder, Be a Follower