Tiger-Backed Flutterwave Becomes Latest Nigeria Tech Unicorn

LAGOS (Capital Markets in Africa) — Flutterwave Inc. said its valuation passed $1 billion after raising funds from investors including billionaire Chase Coleman’s Tiger Global Management LLC, making the payments firm the third in a spate of Africa-focused tech firms to become so-called unicorns.

U.S. hedge fund Tiger was joined by New York private equity firm Avenir Growth Capital in leading the $170 million round, according to a statement on Wednesday. That took total investment to $225 million in five years and pushed the valuation beyond the mark that bestows prestigious unicorn status.

Based in both Lagos and San Francisco, Flutterwave facilitates cross-border transactions across Africa for companies including Facebook Inc. and Uber Technologies Inc. The group will use the fresh capital to grow the customer base and add products such as mobile payments, it said.

Flutterwave achieved unicorn status 15 months after Nigerian digital-payments group Interswitch got thereby selling a 20% stake to Visa Inc. for $200 million. Jumia Technologies AG, based in Berlin but focused on e-commerce in African countries, was also valued at more than $1 billion ahead of its initial public offering in New York.

Flutterwave may also seek a New York listing at some stage, co-founder and Chief Executive Officer Olugbenga Agboola was quoted by Reuters as saying.

On a smaller scale, U.S. payment-services firm Stripe Inc. agreed to pay $200 million to buy Lagos-based Paystack last October, making it Nigeria’s biggest startup acquisition. The boom in payments firms is a reflection of the rapid take up of smartphones and faster internet speeds across Africa, as well as a lack of banking infrastructure.

The latest Flutterwave funding is seen as a “huge win for us in the African tech ecosystem,” said Tomi Davies, president of the African Business Angels Network. The company is the first from Africa to become a unicorn within five years, he said.

Tiger founder Coleman was the world’s highest-earning hedge fund manager last year, according to a list compiled by Bloomberg, taking home $3 billion.

Source: Bloomberg Business News