Stripe's Paystack Acquisition a Big Deal for African eCommerce

The global online payments platform Stripe recently raised $600 million. And one of the top priorities for deploying this new batch of cash was to expand its API-based payments service into new regions.


The company, now valued at $36 billion, has acquired Nigerian payments startup Paystack for an undisclosed sum. TechCrunch is reporting that the sale price was roughly $200 million. 


It's fitting that San Francisco-based Stripe has targeted Lagos-based Paystack. After all, the latter is often referred to as the "Stripe of Africa." In fact, Paystack's founders launched the business on that principle. 


Both organizations operate API-based platforms. This common approach likely contributed to Stripe's decision to enter the African market via this acquisition.  Stripe has already been a Paystack investor, leading the Nigerian company's 2018 A Round. And both companies are alumni of the vaunted startup incubator YCombinator. 


Paystack was founded in 2015 by Shola Akinlade and Ezra Olubi. The company has since expanded into Ghana and South Africa. Paystack has 114 employees spread across nine countries. 


Paystack currently serves 60,000 customers in Africa, ranging from SMMEs to enterprises. MTN is among its major enterprise customers. Both companies say Paystack will continue to operate as an independent business under Stripe's ownership. 


So what does this acquisition say about Africa's fintech future? According to Stripe's deal announcement, online commerce in Africa is growing 75% faster than the rest of the globe.


And with its large and very young population, it's natural that a large global payments company like Stripe would deploy its capital on the continent. And given the existing linkages between the two companies, the deal makes abundant sense. 


We encourage you to read more about the deal on Paystack's blog. Co-founder Shola Akinlade also discussed the deal in this YouTube video


Fintech is one of the key topics to be addressed in BigFive Digital's upcoming Virtual Summit on 4 November. We encourage you to attend for free. 



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