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African fintech startup Chipper Cash raises $30M backed by Jeff Bezos

African cross-border fintech startup Chipper Cash has raised a $30 million Series B funding round led by Ribbit Capital with participation of Bezos Expeditions — the personal VC fund of Amazon CEO Jeff Bezos.

Chipper Cash was founded in San Francisco in 2018 by Ugandan Ham Serunjogi and Ghanaian Maijid Moujaled. The company offers mobile-based, no fee, P2P payment services in seven countries: Ghana, Uganda, Nigeria, Tanzania, Rwanda, South Africa and Kenya.

Parallel to its P2P app, the startup also runs Chipper Checkout — a merchant-focused, fee-based payment product that generates the revenue to support Chipper Cash’s free mobile-money business. The company has scaled to 3 million users on its platform and processes an average of 80,000 transactions daily. In June 2020, Chipper Cash reached a monthly payments value of $100 million, according to CEO Ham Serunjogi .

As part of the Series B raise, the startup plans to expand its products and geographic scope. On the product side, that entails offering more business payment solutions, crypto-currency trading options, and investment services.

“We’ll always be a P2P financial transfer platform at our core. But we’ve had demand from our users to offer other value services…like purchasing cryptocurrency assets and making investments in stocks,” Serunjogi told TechCrunch on a call.

Image Credits: Chipper Cash

Chipper Cash has added beta dropdowns on its website and app to buy and sell Bitcoin and invest in U.S. stocks from Africa — the latter through a partnership with U.S. financial services company DriveWealth.

“We’ll launch [the stock product] in Nigeria first so Nigerians have the option to buy fractional stocks — Tesla shares, Apple shares or Amazon shares and others — through our app. We’ll expand into other countries thereafter,” said Serunjogi.

On the business financial services side, the startup plans to offer more API payments solutions. “We’ve been getting a lot of requests from people on our P2P platform, who also have business enterprises, to be able to collect payments for sale of goods,” explained Serunjogi.

Chipper Cash also plans to use its Series B financing for additional country expansion, which the company will announce by the end of 2021.

Jeff Bezos’s backing of Chipper Cash follows a recent string of events that has elevated the visibility of Africa’s startup scene. Over the past decade, the continent’s tech ecosystem has been one of the fastest growing in the world by year year-over-year expansion in venture capital and startup formation, concentrated in countries such as Nigeria, Kenya, and South Africa.

Image Credits: TechCrunch/Bryce Durbin

Bringing Africa’s large unbanked population and underbanked consumers and SMEs online has factored prominently. Roughly 66% of Sub-Saharan Africa’s 1 billion people don’t have a bank account, according to World Bank data.

As such, fintech has become Africa’s highest-funded tech sector, receiving the bulk of an estimated $2 billion in VC that went to startups in 2019. Even with the rapid venture funding growth over the last decade, Africa’s tech scene had been performance light, with only one known unicorn (e-commerce venture Jumia) a handful of exits, and no major public share offerings. That changed last year.

In April 2019, Jumia — backed by investors including Goldman Sachs and Mastercard — went public in an NYSE IPO. Later in the year, Nigerian fintech company Interswitch achieved unicorn status after a $200 million investment by Visa.

This year, Network International purchased East African payments startup DPO for $288 million and in August WorldRemit acquired Africa focused remittance company Sendwave for $500 million.

One of the more significant liquidity events in African tech occurred last month, when Stripe acquired Nigerian payment gateway startup Paystack for a reported $200 million.

In an email to TechCrunch, a spokesperson for Bezos Expeditions confirmed the fund’s investment in Chipper Cash, but declined to comment on further plans to back African startups. Per Crunchbase data, the investment would be the first in Africa for the fund. It’s worth noting Bezos Expeditions is not connected to Jeff Bezo’s hallmark business venture, Amazon.

For Chipper Cash, the $30 million Series B raise caps an event-filled two years for the San Francisco-based payments company and founders Ham Serunjogi and Maijid Moujaled. The two came to America for academics, met in Iowa while studying at Grinnell College and ventured out to Silicon Valley for stints in big tech: Facebook for Serunjogi and Flickr and Yahoo! for Moujaled.

Chipper Cash founders Ham Serunjogi (R) and Maijid Moujaled; Image Credits: Chipper Cash

The startup call beckoned and after launching Chipper Cash in 2018, the duo convinced 500 Startups and Liquid 2 Ventures — co-founded by American football legend Joe Montana — to back their company with seed funds. The startup expanded into Nigeria and Southern Africa in 2019, entered a payments partnership with Visa in April and raised a $13.8 million Series A in June.

Chipper Cash founder Ham Serunjogi believes the backing of his company by a notable tech figure, such as Jeff Bezos (the world’s richest person), has benefits beyond his venture.

“It’s a big deal when a world class investor like Bezos or Ribbit goes out of their sweet spot to a new area where they previously haven’t done investments,” he said. “Ultimately, the winner of those things happening is the African tech ecosystem overall, as it will bring more investment from firms of that caliber to African startups.”

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LA-based A-Frame, a developer of celebrity-led personal care brands, raises cash for its brand incubator

A-Frame, a Los Angeles-based developer of personal care brands supported by celebrities, has raised $2 million in a new round of funding led by Initialized Capital.

Joining Initialized in the round is the serial entrepreneur Moise Emquies, whose previous clothing lines, Ella Moss and Splendid, were acquired by the fashion holding company VFC in 2017.

A-Frame previously raised a seed round backed by cannabis dispensary Columbia Care. The company’s first product is a hand soap, Keeper. Other brands in suncare and skincare, children and babycare, and bath and body will follow, the company said.

“We partner with the investment groups at the agencies,” said company founder and chief executive, Ari Bloom. “We start interviewing different talent, speaking with their agents and their managers. We create an entity that we spin out. I wouldn’t say that we compete with the agencies.”

So far, the company has worked with CAA, UTA and WME on all of the brands in development, Bloom said. Two new brands should launch in the next couple of weeks.

As part of the round, actor, activist, and author Hill Harper has joined the company as a co-founder and as the company’s chief strategy officer. Emquies is also joining the company as its chief brand officer.

“Hill is my co-founder. He and I have worked together for a number of years. He’s with me at the holding company level. Identifying the opportunities,” said Bloom. “He’s bridging the gap between business and talent. He’s a part of the conversations when we talk to the agencies, managers and the talent. He’s a great guy that I think has a lot of respect in the agency and talent world.”

Initialized General Partner Alda Leu Dennis took point on the investment for Initialized and will take a seat on the company’s board of directors alongside Emquies. Other directors include Columbia Care chief executive, Nicholas Vita, and John D. Howard, the chief executive of Irving Place Capital.

“For us the calculus was to look at personal care and see what categories need to be reinvented because of sustainability,” said Bloom. “It was important to us once we get to a category what is the demographic opportunity. Even if categories were somewhat evolved they’re not all the way there… everything is in non-ingestible personal care. When you have a celebrity focused brand you want to focus on franchise items.”

The Keeper product is a subscription-based model for soap concentrates and cleansing hand sprays.

A serial entrepreneur, Bloom’s last business was the AR imaging company, Avametric, which was backed by Khosla Ventures and Y Combinator and wound up getting acquired by Gerber Technology in 2018. Bloom is also a founder of the Wise Sons Delicatessen in San Francisco.

“We first invested in Avametric at Initialized in 2013 and he had experience prior to that as well. From a venture perspective I think of these all around real defensibility of brand building,” said Dennis.

The investors believe that between Bloom’s software for determining market preferences, A-Frame’s roster of celebrities and the company’s structure as a brand incubator, all of the ingredients are in place for a successful direct to consumer business.

However, venture capitalists have been down this road before. The Honest Co. was an early attempt to build a sustainable brand around sustainable personal care products. Bloom said Honest provided several lessons for his young startup, one of them being a knowledge of when a company has reached the peak of its growth trajectory and created an opportunity for other, larger companies to take a business to the next level.

“Our goal is a three-to-seven year horizon that is big enough at a national scale that a global player can come in and internationally scale it,” said Bloom.

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London and SF have become Impact Tech hubs, with 280% increase in VC in 5 years

New research has found that San Francisco and London have become two of the world’s leading hubs for VC investment into tech solutions that address one or more of the 17 UN’s Sustainable Development Goals (SDG), more commonly referred to as “Impact Tech”. They are followed by Paris, Berlin, Stockholm, Shanghai and Beijing.

Tech solutions for such pressing issues as the climate crisis and social inequality have seen a 280% increase in global VC investment from 2015 to 2020, while investment in this space more than doubled in both cities over the past five years. The report was put together by London & Partners and Dealroom as part of this week’s Silicon Valley Comes to the UK virtual event. More than 5,000 startups were surveyed to create the data.

According to the research, VC investment into London-based impact tech startups has grown by almost 800% (7.8 times) since 2015, compared to 3.1 times in Europe as a whole. 2020 is set to be a record year for London’s impact tech companies, which have received $1.2 billion in VC investment from January to October, already matching 2019 levels. London’s impact firms have also secured 429 deals between 2015 and 2020, more than any other city globally.

San Francisco’s impact-based tech companies have also shown strong growth over the past five years, with the data revealing that VC investment into its impact tech companies has almost tripled (2.8 times) from 2015 to 2020. So far this year, SF-based impact tech companies attracted $1.7 billion of VC investment in 2020 — more than any other city globally. At a national level, the United States received more VC funding for impact tech companies than any other country in the past five years, with investors pumping $35.8 billion into U.S. firms since 2015, double the amount invested into China ($16.8 billion) and the United Kingdom ($6.1 billion).

The research also found that the U.K. capital has produced 241 impact startups since 2006, with 95 companies founded in San Francisco. In London, “impact unicorns” include Octopus Energy (green energy), Arrival (zero-emission, public transportation vehicles), Gousto (food) and Babylon Health (AI health tech).

Climate change and clean energy solutions have attracted the most interest from investors in both cities, making up over 50% of overall VC investment over the last five years. Funding rounds including at least one North American investor made up $234 million of VC investment so far this year in London, up from $85 million in 2018, and equating to a fifth of all VC investment into London’s impact startups.

Funding rounds for London impact companies involving North American investors in 2020 include a $118 million growth equity round into Arrival by BlackRock, an $80 million Series B round for COMPASS Pathways and a $25 million Series C funding for Tractable.

Meanwhile, impact startups are crossing the pond in both directions. Arrival is now operating in Los Angeles, while Octopus Energy launched in the U.S. market in September after closing a $360 million funding round in April and acquiring Silicon Valley-based startup Evolve Energy. And San Francisco-based Allbirds, the sustainable shoe retailer, opened its first European flagship store in London in July 2018.

Commenting, Janet Coyle, managing director for business, London & Partners said: “San Francisco and London are two of the world’s top hubs for innovation and technology. But today’s figures also show that they are leading the way in creating purpose-driven companies striving to tackle some of the most pressing environmental and social challenges.”

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