Flutterwave;The Journey to a $3bn Valuation

On 16th February 2022, Flutterwave raised a $250m Series D at a $3bn valuation tripling its valuation in just 12 months and becoming Africa’s most valuable startup overtaking fellow Nigerian fintech OPay and Chipper Cash.

Investors in this funding round included B Capital Group, Alta Park Capital, Whale Rock Capital, Lux Capital, Avenir Growth Capital, Tiger Global Management, Glynn Capital Management, Green Visor Capital and Salesforce Ventures. Flutterwave has now raised about $475m since its inception.

The startup claims to have operations in 34 African countries and processed 200m transactions in 2021 that were valued at $16bn. It has 900,000 businesses that use the various payment methods on the platform. 

In April 2020, Flutterwave launched its store that has since been rebranded to Flutterwave Market and it has attracted 30,000 merchants so far. This market enables merchants to sell their ware online. 

In December last year, it launched Send, a remittance service tapping Nigerian superstar Wizkid as its ambassador. It is currently its fastest-growing product and completed 4,729 transactions worth $3.59m in its first month. 

After being successful in Sub-Saharan Africa, Flutterwave expanded to North Africa with Morocco and Egypt as its first markets. This is part of its plan to expand to other emerging markets like the Middle East and Latin America.

Flutterwave has also started making inroads in the USA. Despite having its headquarters in San Francisco,  the startup had no operations there. But this has changed. Merchants can now use the platform to make ACH Payments, collections and payouts in the USA.  

It also launched Grow in September 2021, a product that helps African businesses to register and incorporate in the US and UK. Flutterwave plans to use its Series D to fuel an expansion drive into new markets and launch complementary products in its efforts to be much more than just a payments company. 

The Series D was a huge coup for the startup and the entire African ecosystem in general. In this article, we explore Flutterwave’s previous funding rounds and metrics that have contributed to its journey of becoming the continent’s most valuable startup. 

Flutterwave is a Nigerian fintech company that provides end to end payments technology and infrastructure. It enables payment service providers, global merchants, licensed money transfer operators and Pan-African banks to process payments to and from Africa with just one API integration. 

Flutterwave was founded in 2016 by Iyinoluwa Aboyeji, Olugbenga Agboola and Adeleke Adekoya after raising a $230,000 seed round from Y Combinator. Other investors in this round included Zillionize, Green Visor Capital and Golden Palm Investments among others. 

In April 2017,  it raised $250,000 from LoftyInc Capital Management in what might arguably be Idris Adoyeji Bello’s greatest investment to date. It also received a $50,000 Grant on May 23 2017 from the Google Launchpad Accelerator Africa which helps startups from around the world in developing the world’s greatest apps. 

On 1st August 2017, Flutterwave raised $10m for its Series A attracting existing investors like Y Combinator and Green Visor Capital back into the fold. Other investors included Plug & Play, Greycroft and Glynn Capital Management.

Flutterwave claimed to have processed 14m payments valued at $1.5bn. The funds were to be used to fund a rapid expansion across Africa and globally as well as hiring more talent.

This funding round was followed by another $10m in a Series A extension on 18th October 2018. This brought the amount raised by the then two-year-old startup to over $20m. Investors in this round were Raba Capital, Mastercard, FinTech Collective, CRE Venture Capital and 4Dx Ventures.

As a result of this raise, former VISA Chairman and current General Partner of Green Visor Capital, Joe Saunders joined the startup on its Board. Co-founder Aboyeji, 27 at the time, also announced he was quitting his role as CEO for personal reasons and was replaced by another member of the founding team, Olugbenga Agboola, a financial technology engineer who had previously worked at PayPal, Google, GTBank and Access Bank among others.  

At the time of this investment, Flutterwave had offices in Lagos, Nairobi, Accra and Johannesburg and had clients like Transferwise, Flywire, Booking.com, Jumia, Uber among others. 

On 21st January 2020, the startup kicked off the Olugbenga era with a $35m Series B from Greycroft Ventures, VISA, Green Visor Capital and CRE Venture Capital. The funds were to be used to invest in technology and business development to grow market share in existing countries. 

We also got a glimpse of the new direction under Olugebenga who wanted to expand capabilities to offer more services around payment products. In an interview with TechCrunch, Olugbenga told Tage Ulonna, “We don't just want to be a payment technology company, we have sector expertise around education, travel, gaming, e-commerce, fintech companies. They all use our expertise.”

2019 company data showed that the startup had completed 107m transactions valued at $5.4bn. Among the standout transactions, it did that year was the payment integration for US Popstar Cardi B’s 2019 performances in Ghana and Nigeria. 

It also announced a partnership with WorldPay FIS. Any WorldPay merchant in Europe or USA could now accept any African payment. WorldPay and its mother company, FIS were projected to make $12bn in revenue in 2019 but had almost no presence in Africa. 

This partnership came on the back of another big one after Flutterwave partnered with Alibaba’s Alipay offering digital payments between China and Africa starting in July 2019. 

In March 2021, Flutterwave became Africa's 4th unicorn after Jumia, Interswitch and Fawry. It was also the youngest to attain that status at the time, having taken just 5 years. It raised a monster $170m Series C at a valuation of $1bn led by New York private investment firm Avenir Growth Capital and powerful US Hedge Fund Tiger Global Management. Other investors were DST Global, Green Visor Capital, Greycroft Capital, Insight Partners, PayPal, Salesforce and 9yards Capital. 

At the time of this funding round, it had completed 140m transactions valued at $9bn in 2020 profiting from the growth of online transactions during the COVID19 pandemic. It also has more than 290,000 businesses that use the platform to make payments in 150 currencies using multiple payment modes like local and international cards, mobile wallets, bank transfers and barter by Flutterwave. 

Flutterwave was live in 20 African countries but could be used in 33 countries in total. It had also launched the Flutterwave Store on which merchants could sell their wares. It was available in 15 countries and had attracted 20,000 merchants already. Flutterwave wanted to use this investment to become a global payments company, not just African. It also wanted to speed up its customer acquisition in markets where it was operating and improve existing product offerings like Barter which had over 500,000 users at the time. 

But the more interesting thing Flutterwave wanted to do was to introduce Flutterwave Mobile that could turn merchants' mobile devices into a point of sale, allowing them to accept payments and make sales.

The number of days between each funding round has reduced steeply. It took the startup 791 days between its $230,000 seed round on 15th August 2016 and finalizing its $20m Series A on 15th October 2018. However, it would raise a $35m Series B just 463 days later. From its Series B to its $170m Series A announced on 1st March 2021, it was just 405 days and it would wait only 352 days before it announced its $250m Series D.

The number of transactions grew exponentially at each funding round from 60m transactions (valued at $2bn) at its Series A point in 2018 to 107m transactions (valued at $5.4bn) at its Series B point in 2020. By its Series C, this figure stood at 140m transactions (valued at $9bn) and 200m (valued at $16bn) at its Series D point. 

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