The belief that 9 out of 10 startups are bound to fail due to reasons tied to stiff competition, flawed business model, cost issues and failure to raise capital is fast becoming a cliché. This is owing to the changing business landscape around funding, providing avenues for startups all around the world to show resilience, scale and expand across board and possibly clinch a unicorn status.
A new report by CBInsight shows that the total number of startups globally reached 1,000 as of the 2nd of February 2022. This is led by Chinese Bytedace and American Space X, each valued at over $100 billion and another 46 companies boasts decacorn status (over $10 billion valuations), while roughly 31% of unicorns are valued at exactly $1 billion.
The digit shows that the total number of the world’s billion-dollar companies jumped from 563 in 2020 to 957 in 2021 also improving to reach 1,000 in the early days of 2022, as the world added 43 unicorns across the globe in the first 33 days of the year.
While the US and China dominate the list, accounting for 51% and 17% respectively, African startups as well have joined the rest of the world, proving that they are here to stay, expanding with time, improving their performances and even reaching a billion-dollar valuation.
About six years ago, Africa had not a single unicorn, but today, the continent accounts for about 7 startups worth over $1 billion. While this translates into a significant improvement, it also spells a prosperous future for the up and coming startups.
Investors are beginning to show confidence in African ideation, thereby placing a bet on the continent’s brain in expectation of positive development. Nairametrics spotlights unicorn status startups operating in Africa or owned by Africans in diaspora, and they are as follows:
Chippers Cash (over $2 billion)
Chippers cash is a fintech startup that facilitates cross-border payment across Africa. The venture-capital-backed financial technology company builds software to enable free and instant peer-to-peer cross-border payments.
Last year, the company hit a $2 billion valuation after raising its first Series C round of $100 million led by SVB Capital. This was further strengthened after six months by another $150 million in a Series C extension round led by Sam Bankman-Fried’s cryptocurrency exchange platform, summing the total of Series C capital to $250 million.
The company was founded in 2018 by two African entrepreneurs; Ugandan Ham Serunjogi and Ghanaian Maijid Moujaled in San Francisco to provide a no-fee peer-to-peer cross-border payment service in Africa via their app. Amongst countries that use its services are; Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa, and Kenya.
Andela – ($1.5 billion)
Andela is a global talent network that connects companies with engineering talent in emerging markets. Andela is a global company with operations across 5 continents.
The fintech was founded in 2014 by four professionals working in the online education and recruitment business; Iyinoluwa Aboyeji, Ian Carnevale, Jeremy Johnson and Christiana Sass, as a training company to match developers in emerging markets now known as technology hubs.
The company has raised a total of $381 million funding in multiple rounds with the latest funding raised in September 2021 from a Series E round bringing the company’s valuation to $1.5 billion. The fintech is funded by Generation Investment Management and Spark Capital as the most recent investors.
OPay (over $2 billion)
OPay is a company that enables users to accomplish more with their money by providing smart financial services by designing a mobile payment service and consumer platform for users to send and receive money, pay bills and other online transactions. The neobank based in Nigeria offers personal accounts including a debit card, with all transactions being managed from an iPhone or Android application.
The company raised a total of $570 million in funding over 3 rounds with its latest funding raised in August 2021 from a Series C round and is currently worth over $2 billion.
The company was founded in 2018 by Yahul Zhou, a Chinese billionaire entrepreneur.
Wave ($1.7 billion)
Wave is a US and Senegal-based mobile money provider that promises low fees on accounts, deposits, bills payments and withdrawals for users who want to send money
The African mobile money provider recently raised $200 million in a Series A round valuing the company at $1.7 billion. The funding is the largest Series A round raised for the region, making it the first francophone African unicorn
Wave was launched in 2018 by Drew Durbin and Lincoln Quirk, the founders of remittance and YC-backed company, SendWave, a company that allows users to safely and instantly send money from North America and Europe to numerous countries across Africa and Asia.
Flutterwave – ($1 billion)
Flutterwave is a fintech company based in Africa and provides a payment infrastructure for global merchants and payment service providers across the continent. The fintech, headquartered in San Fransisco, California with operations in 10 african countries including Nigeria, Kenya and Ghana, was founded by Iyinoluwa Aboyeji, Olugbenga Agboola and Adeleke Adekoya in 2016.
According to Disrupt Africa, Flutterwaves has raised a total of $234.7 million in funding in over 11 rounds as of today. Their latest funding was raised in March 2021 from a Series C round which pushed the company’s valuation to over $1 billion.
In March last year, it acquired Disha, a creative platform helping creators to make a living by offering them simple tools to create In December 2021. It also invested in Cinetpay in a seed round valued at $2.4 million.
Interswitch ($1 billion)
Interswitch is an integrated digital payments and commerce company designed to make payments an easy and enjoyable experience. It was established as a common African financial services provider and maintains exclusively, a wide array of interconnected data centres in Africa.
The fintech achieved unicorn status in 2019 after a $200 million equity investment by Visa gave it a $1 billion valuation however, its latest funding was raised in November 2019 from a corporate round.
The Nigeria financial services company headquartered in Lagos and founded by Mitchell Elegbe in 2002, pioneered the infrastructure to digitize Nigeria’s then predominantly cash-based economy.
Esusu ($1 billion)
Esusu is the most recent unicorn traced to the continent. The credit building startup reached unicorn late January after a $130 million Series B funding led by Softbank and reflecting a more than ten-fold increase in Esusu’s valuation from its previous funding round last July. The startup was named to the Forbes Fintech 50 list last year.
The financial technology platform that reports rental data to build tenants’ credit scores while helping property owners increase revenue, was founded in 2018 by Indian Samir Goel and Nigerian Abbey Wemimo, as the co-founders and co-CEOs of Esusu.
The company helps report rent payments for more than two million rental units across all 50 states in the U.S., up from 1 million units last year by partnering with some top property managers in the country like Mercy Housing, WinnResidential, Goldman Sachs Asset Management amongst others.
Jumia ($1 billion)
Jumia was launched in Nigeria in 2012 led by ex-Mckinsey consultants, Jérémy Hodara (CEO) and Sacha Poignonnec (CEO) and has since spread to African countries including; Egypt, Morocco, Ivory Coast, Kenya and South Africa and others also expanding and launching platforms like Jumia Food, Jumia Travel, Jumia Deals, Jumia One, Jumia Pay and others.
In 2016, the company rose to become the continent’s first unicorn valued at over $1 billion and in April 2019, it went public on the New York Stock Exchange (NYSE), raising $196 million in net proceeds. The share price, initially offered at $14.50, rose more than 200% in the first three trading sessions. But after reaching a peak of nearly $50 on 1 May 2019, the share value has declined to under $5/share by year’s end.
In recent times, however, the valuation has continued to alter. As of the time of writing the company is valued at $907 million, depicting less than a billion valuation, but the value rose last Wednesday to about $984 million at $9.99 per share price.
So far this year, the company gained its highest on the first trading day of the year at $11.97 per share price to value at $1.18 billion.
Fawry ($1 billion)
Fawry is the biggest e-payment network in Egypt providing payment services to clients through several canals and more than 60,000 service points.
The company was founded in 2008 and launched in December 2009 by Ashraf Sabry, to meet the need for convenience and easy payments in Egypt where traffic congestion and complex procedures were daily challenges for individuals and business owners.
Fawry surpassed a $2 billion market valuation, a milestone achieved after the company went public in 2019 and attracted the support of major investors which led to its stock price shooting up significantly from EGP 6.46 ($0.4) opening price to over 7 times after about eighteen months later.
As of today, however, the price market cap of the banks is valued at $989 million (EGP 15.5 million).
Conclusion
Notably, Jumia and Fawry’s valuation continues to fluctuate as a result of market volatility in the New York Stock Exchange (NYSE) and Egypt Exchange (EXG) respectively. While both are currently valued under $1 billion, at different points in the past, they had risen to hit over $2 billion.
