Nigerian fintech startup, Paystack has been acquired by Stripe, a US-based fintech company. Though the terms of the deal are undisclosed, reports have it that the company was acquired for a deal of about $200 million. This is the biggest acquisition deal to come out of sub-Saharan Africa.
Founded by Shola Akinlade and Ezra Olubi, the five-year-old startup enables businesses to accept payments via credit card, debit card, money transfer and mobile money on their websites or mobile apps. Currently, the Paystack suite which includes collections, disbursements, identity verification, reporting and commerce tools, is said to be used by 60,000 small businesses, larger corporates, fintech, educational institutions, and online betting companies across Nigeria and Ghana.
In 2016, Paystack got accepted into Y Combinator — US-based seed-stage accelerator — and it received $120k in funding as well as access to global investors. It also raised a seed funding of $1.3 million from Tencent, Michael Seibel, Comcast Ventures, Singularity Investments and other investors. Interestingly, in 2018, Stripe led an $8 million Series A funding round for Paystack. The round was joined by global payments company Visa, with follow-on investment from Tencent and Y Combinator. All of these brought the total investment raised by the company to a little over $10 million.
In the midst of a tough week in Nigeria, we have some positive news to share.
— Paystack (@paystack) October 15, 2020
Commenting on the acquisition, CEO and co-founder of Paystack, Shola Akinlade stated that “Paystack is a growth engine for modern businesses in Africa, and we couldn’t be more excited to join forces with Stripe, whose mission and values are so aligned with ours, to nurture transformative businesses on the continent.”
The acquisition will help Paystack continue to build its products in Nigeria as well as expanding into the African continent. Stripe’s business lead in Europe, the Middle East and Africa (EMEA), Matt Henderson, said: “This acquisition will give Paystack resources to develop new products, support more businesses and consolidate the hyper-fragmented African payments market.”
It’s worth mentioning that Stripe which raised $600m earlier this year has invested in startups across the world, some of which include the Philippines-based payment platform PayMongo. With its acquisition, Paystack has stated that it will continue to operate independently and there will be no disruption of service.
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