FinTech news in Chipper Cash category
FTX marked down Chipper Cash’s $2B valuation to $1.25B The company says it has over 5 million customers across Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa and Kenya — and more recently, the U.S. and U.K., where the FTX-backed startup expanded last year to facilitate peer-to-peer money movement from both countries to select regions in Africa.
Other African startups on the list include: OVEX, a South African digital asset exchange and OTC trading desk ($5 million from FTX at a $122 million valuation); Kenya-based payment automation and settlement company AZA Finance ($25 million promissory note/loan); African mobile money unicorn Wave ($10 million in equity); South African crypto exchange platform VALR ($4 million equity); Nigerian crypto exchange startup Bitnob ($500,000 from FTX at a $20 million valuation); Nestcoin, a Nigerian web3 platform whose assets got stuck on SBF’s bankrupt crypto exchange platform ($250,000 equity from FTX at a $30 million valuation), and Congolese-based web3 startup Jambo ($500,000 in tokens). According to FT, the four-year-old fintech was one of over 450 investments Sam Bankman-Fried wanted to offer as collateral in an attempt to raise money for the FTX group, which includes 10 holding companies such as Alameda Research, FTX Ventures, FTX Trading, Maclaurin Investments and Clifton Bay Investments (the arm used to invest in Chipper Cash.) FTX processed billions monthly in Africa before going bust It’s not clear if Chipper Cash will maintain this valuation in its next priced round seeing as its lead investor FTX is currently bankrupt. Sam Bankman-Fried’s now-defunct cryptocurrency exchange platform FTX led the round and Chipper Cash’s valuation skyrocketed to $2 billion, becoming one of Africa’s five unicorns last year.
It expanded to the U.K. — allowing people to send money from the European nation to Chipper Cash’s African markets — and the U.S. — to facilitate peer-to-peer money movement from the U.S. to Nigeria and Uganda. CEO Ham Serunjogi founded Chipper Cash with Maijid Moujaled in 2018 to offer a no-fee peer-to-peer cross-border payment service in Africa via its app. The investment came barely six months after Chipper Cash closed its first Series C round of $100 million, led by SVB Capital, the corporate venture capital arm of SVB Financial Group. Chipper Cash, an African cross-border payments company valued at $2.2 billion last year, has laid off a portion of its workforce.
A day after Central Bank of Kenya (CBK), Kenya monetary authority, said that Chipper Cash and Flutterwave were not licensed to operate in the East African country, the regulator has directed all financial institutions to cease doing business with the two fintechs. The CBK’s bank supervision deputy director, Matu Mugo, in a letter, directed all regulated banks, microfinance and mortgage finance institutions to stop their partnerships with the two startups with immediate effect — dealing a blow to Flutterwave and Chipper Cash, some of Africa’s highest valued startups. Flutterwave, which is also facing money laundering allegations in Kenya, in a statement said it has been operating in the country through partnerships with regulated banks and telecoms, as it waits for a payments service provider license it applied for in 2019. The letter to the bank CEOs followed remarks by CBK’s governor, Patrick Njoroge, that the two startups are not licensed remittance or payment service providers in Kenya — one of the biggest fintech hubs in Africa.
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.