Afriex, a Nigerian fintech startup has reportedly raised $10 million in a Series A funding round with the raised funds to be used to bolster its blockchain money transfer platform.
The financing was led by Sequoia Capital China and Dragonfly Capital with participation from Goldentree, Stellar Foundation, and Exceptional Capital, among others. This comes after the company raised a $1.3 million seed round last May to scale its payment platform across Africa.
Launched in 2019 by Tope Alabi and John Obirije as a Nigerian fintech company, Afriex, which has further expanded its operations across Uganda, Kenya and Ghana offer a platform that utilizes blockchain to enable users to send funds by converting them into stablecoins — which are cryptocurrencies backed by reserve assets. This process makes the transaction free and quicker than an existing service like Wise which charges a 6.45% fee and can take a few days to process.
Dragonfly Capital managing partner Haseeb Qureshi in an interview with Forbes explains that he met Tope Alabi when he was a mentor at a crypto startup school run by A16z and was impressed by his work but excluded himself from the seed round as he was skeptical about the success of crypto businesses in Africa but he now thinks the company may have cracked that code. “A big strength of the company is being able to straddle the entire corridor between the U.S. and Africa where many others have tried to succeed and have not,” he says. “The reality is that if you want to succeed in emerging markets you need a really strong ground game.”
Afriex, which declined to share its revenue, is valued at $60 million and while it is currently just focused on its core money transfer product, Tope Alabi has made clear his ambitious goals for the platform with the hopes of utilizing it to launch a stablecoin. The company has already struck a partnership with Visa to offer Afriex users credit and debit cards later this year.
“Because we are building this network of connected financial institutions, we have built on-ramps for local Nigerian banks and on-ramps for local currency exchanges,” Tope Alabi says. “We are building this web3 mesh of financial institutions that could almost become something like the next Visa.”
Afriex’s success since its launch cannot be overstated as the company processes more than $5 million in monthly transfers and has grown its customer base by 500% in the last six months with half of its active users using the platform more than once a week.
