SoftBank’s first foray into Africa🔥; Spend management is growing on steroids 🚀; Crypto mining unicorn 🦄

Good Morning FinTech. 30/30

Good morning Everyone,

And happy Wednesday! We are already in the middle of the week, those days are passing way too fast…

Today is the Day as it marks the last free issue, and starting tomorrow daily newsletters will be available to subscribers only. If you enjoyed my daily newsletters and want to be part of the community, hit that subscribe button, and let’s roll 😎

And here’s a mix of 3 great stories for the last, the 30th issue:

SoftBank’s first foray into Africa🔥

FinTech in Nigeria🇳🇬 Giant technology investor SoftBank has made its first foray into Africa, making its first bet in Nigerian mobile payments platform OPay. The firm’s Vision Fund 2 led a $400M funding round for the FinTech company, valuing it at $2 billion and making it one of the most valuable private companies in the continent 🦄

The capital injection from SoftBank also drew participation from existing investors including Sequoia Capital China, Redpoint China, Source Code Capital, and SoftBank Ventures Asia.

The pivot 😎 Founded in 2018, the company started off by providing customers with digital services in their everyday life, from mobility and logistics to e-commerce and FinTech at cheap rates. The “super-app” strategy OPay once had was cut short after its ride-hailing and bike-sharing services were closed down following a government ban in Nigeria and the impact of the COVID-19 pandemic.

Right now, it’s the company’s mobile money and payment arm that thrives the most. By simply allowing unbanked and underbanked users in Nigeria to send and receive money and pay bills through a network of thousands of agents.

The growth 🚀 OPay has grown at an exponential rate. Parent company Opera reported that OPay’s monthly transactions grew 4.5x to over $2 billion in December last year. OPay also claims to process about 80% of bank transfers among mobile money operators in Nigeria and 20% of the country’s nonmerchant point of sales transactions. Per Bloomberg, the company’s monthly transaction volumes exceed $3B at the moment.

✈️ THE TAKEAWAY

I’ve said this multiple times, and I will say it again… Africa is the next BIG Thing (especially when it comes to FinTech). Still few understand that. After the latest fundraise, OPay is now bigger than GT Bank, the biggest bank in Nigeria (in terms of valuation). FinTech is growing strong in Africa, and it will only get stronger.

Spend management is growing on steroids 🚀

The funding 💸 Spend management startup Ramp has raised $300M in a Series C round of funding that values the company at $3.9B.

The crazy part? That’s more than double the $1.6B that US-based Ramp was valued at in April 2021 at the time of its Series B. Founders Fund led the latest round, which brings the FinTech’s total equity and debt raised to date to over $625M since its March 2019 inception.

Massive demand & growth 🚀 Since the beginning of 2021, the company says it has seen its number of cardholders on its platform increase by 5x, with more than 2,000 businesses currently using Ramp as their ‘primary spend management solution’.

The transaction volume on its corporate cards has tripled since April 2021, when its last raise was announced. Also,  Ramp has seen its transaction volume increase year over year by 1,000%, according to its CEO.

The biz model 👀 Ramp makes money mostly off interchange fees. It saw its revenue increase by the same amount as transaction volume 🤯

✈️ THE TAKEAWAY

B2B payments space is very hot lately. Especially when it comes to the spend management space. Founded in 2017, San Francisco-based Ramp’s rival Brex earlier this year was valued at whopping $7.4B after raising a $425M Series D. Yet, Brex is more focused on earlier-stage startups, whereas Ramp tends to serve larger, more established companies. Either way, B2B payments is worth trillions globally and it’s yet to be properly disrupted by FinTech. More challengers should join the race soon.

Crypto mining unicorn 🦄

The funding 💸 Bitcoin technology firm Blockstream has raised $210M in a Series B funding round that values the company at $3.2B and will fund an expansion into manufacturing mining chips.  

U.K. investment management firm Baillie Gifford and iFinex, the parent company of cryptocurrency exchange Bitfinex and stablecoin issuer Tether, participated in the round.

The USP 🥊 Blockstream was founded in 2014 with a focus on building infrastructure and applications based upon the Bitcoin network. The firm was co-founded by CEO Adam Back (inventor of Hashcash, a system for discouraging spam emails that influenced Satoshi Nakamoto’s proof-of-work consensus mechanism design for Bitcoin) and nine others, including Bitcoin Core developer Gregory Maxwell.

✈️ THE TAKEAWAY

Brilliant timing. Giving the growing adoption and popularity of cryptocurrency, it’s a brilliant time to focus on the hardware. The funding will enable Blockstream to build out a business line making specialized mining chips known as ASICs. And they have serious ambitions here as following the fundraiser, Blockstream had acquired the intellectual property and key employees of Israeli Bitcoin mining hardware manufacturer Spondoolies for undisclosed terms.

🔎 What else I’m watching

• Circling in reserves 😵 Circle’s (the company behind the USDC stable coin) latest announcement is all focused on reserves about reserves when it comes to stablecoins. Crypto exchange Coinbase and network Centre are collaborating to support Circle's USD Coin (USDC), in part by shifting the mix of assets and holdings that back the stablecoins themselves. As an effect, the company is backing each coin with $1 in reserves – via cash and short-term U.S. Treasuries.

• Growing institutional demand in the UK for crypto🇬🇧 Research by Nickel Digital, a digital asset hedge fund manager founded by former Goldman Sachs and JPMorgan investment professionals, found that more than 50% of U.K. institutional investors in a survey plan to increase their crypto-asset exposure between now and 2023.

• DeFi adoption is still not mainstream 👀 In its “Global DeFi Adoption Index,” the blockchain data firm Chainalysis found that while DeFi adoption has increased significantly over the past 18 months in both emerging and developed markets, most of that growth has occurred in countries and regions with higher incomes and more professional investors and traders.

• Klarna is dominating the US🇺🇸 Swedish buy now, pay later (BNPL) company Klarna announced that it has doubled its U.S. customer base since June 2020, reaching a whopping 20M customers. The growth has been propelled in large part by the popularity of the Klarna app, which now has 4M monthly active users in the U.S.

• Branding 🙌🏼 The FTX.US exchange has signed a $17.5M, 10-year agreement with Cal Athletics, the athletic department of the University of California Berkeley, for naming rights at the California Memorial Stadium. The field will be known as the “FTX Field” and the deal is FTX.US’s first college-related naming rights sponsorship. 

• India is crushing in payments🇮🇳 A recent report by EIU (The Economist Intelligence Unit) found that India is leading the real-time payments market, followed by China and South Korea. In terms of the mobile payment market, China leads instead, followed by India. According to the report, India offers a prime example of the shift to modernize payments systems in order to keep commerce flowing and sustain economic growth.

• The rebrand 👉 Paxos has announced that it is rebranding its stablecoin from Paxos Standard (PAX) to Pax Dollar (USDP). "The USDP ticker more easily identifies Pax Dollar as a US dollar-backed token," said Paxos head of strategy Walter Hessert.

• Don’t stop till you get enough! Michael Saylor's publicly traded company MicroStrategy has expanded its bitcoin hoard once again, announcing the purchase of 3,907 BTC for a total of $177M. The purchase was disclosed Tuesday. This brings MicroStrategy's total bitcoin supply to 108,992 BTC, an amount worth approximately $5.3B at press time. Saylor said Tuesday morning that the company has spent "~$2.918B at an average price of ~$26,769 per bitcoin" to obtain the digital assets.

💸 Following the Money

• Fractional share & embedded finance firm DriveWealth, which powers FinTechs such as Revolut and Stake, has raised a $450M Series D funding round at a valuation of $2.85B. DriveWealth enables more than 100 global partners to seamlessly embed investment infrastructure through a financial API, enabling customers to invest without ever leaving their platform.

• Blockchain infrastructure startup InfStones raised $10M in a Series A funding round that was led by Shanghai-based Qiming Ventures.

• India-based B2B digital marketplace Zetwerk nets $150M in new funding.

• Financial management platform Pry Financial raised $4.2M in a seed round. The company will use the money to improve collaboration on the platform, which launched last year.

• Nigeria-based B2B e-commerce retail startup Alerzo has raised a $10.5M Series A round led by London-based Nosara Capital. In total, Alerzo has raised more than $20M since its launch.

• India-based FinTech startup Khatabook has closed a $100M Series C funding round led by US-based Tribe Capital and Moore Strategic Ventures (MSV).

👋 That’s it for today! Thank you for reading and have a productive Wednesday! And if you enjoyed this newsletter, invite your friends and colleagues to sign up:

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