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Waffarx, First-Ever Cashback Website in North Africa, Raises New Capital

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WaffarX

WaffarX, the first-ever cashback shopping service in the Middle East and North Africa (MENA) region, announces it has completed a multi-million dollar financing round led by the Silicon Valley venture capital firm, Lobby Capital – for whom it is their first investment in the MENA region.

The endorsement by San Francisco-based Lobby Capital is significant for WaffarX. Lobby Capital is experienced in investing in successful cashback platforms, having been an early investor in the US firm Ebates, which was successfully sold to Japanese company, Rakuten, in 2014 – in what was Japan’s largest ecommerce deal at the time.

WaffarX will use the proceeds to expand its platform, drive user acquisition and enter new markets in the MENA region.

Founded in 2018 by Ezz Fayek, Mahmoud Montasser and Ahmed Kamal, WaffarX uses cutting-edge technology to distribute cash back rewards, helping shoppers save on every dollar they spend. WaffarX’s secure channel helps brands shift advertising spend directly to consumers via cashback rewards. This creates deeper loyalty for brands, whilst customers monetize their own data, instead of third parties.

Consumers want seamless, personalized engagement rather than disruptive advertisements – with easy-to-achieve, tangible cash rewards – transforming everyday transactions into savings. Brands want cost-effective digital advertising solutions and loyalty programs which focus on customers first and resonate with them. Brands can then incentive customers without discounting or devaluing products.

WaffarX has grown exponentially, and now has over 260 merchant partners and over 450,000 members. The company’s cutting-edge technology provides what modern consumers and merchants/brands want, and benefit both groups.

Ezz Fayek, Co-Founder and CEO of WaffarX, said:

“We’re delighted to have completed this latest funding round. The support of an esteemed Silicon Valley firm such as Lobby Capital, and existing investors – A15, are a huge endorsement of WaffarX’s business model and strategy.

“We have always been pioneers in our industry and our solutions are a win-win for consumers and brands. This capital raise will help us maintain our market leadership, break new ground in our platform, increase our user base and expand our geographic presence.”

David Hornik, General Partner of Lobby Capital, commented:

At Lobby Capital, we know the power of the cash back shopping model to drive growth for merchants, savings for consumers, and positive returns for investors. We also know the benefit of working with great founders like Ezz Fayek. We are very excited that the right business model and right people can come together for Lobby’s first investment in the region.

Karim Beshara, General Partner of A15, commented:

As early investors in WaffarX we are excited to see their continued success. Ezz and the team have been thought leaders in the cash back space in MENA and we are excited to see how they continue to innovate and bring new, exciting products to market.”

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Moniepoint Becomes Nigeria’s Newest Unicorn with $1 Billion Valuation After $110M Fundraising

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Moniepoint, a Nigerian-based fintech startup, has attained unicorn status after raising $110 million at over $1 billion valuation, according to the Financial Times.

The company now joined a small club of unicorns with members like MNT-Halan, Interswitch, Flutterwave, Chipper, OPay, and Wave.

The funding round also included a secondary sale with a discounted valuation, which was ideal for many investors.

The funding round led by the London-based private equity firm, Development Partners International, was supported by Google’s Africa Investment Fund.

According to Moniepoint, which had previously raised $55 million from investors, the new fund will be used to further its expansion.

Moniepoint and other peer-to-peer payment platforms experienced rapid growth in recent years following the decision of the Central Bank of Nigeria (CBN) to enforce its cashless policy in order to reduce cash transactions and encourage digital transactions.

This development saw many businesses and individuals open accounts with fintech companies, especially in regions without banks, and an increase in Point of Sales (PoS) agents.

Chief executive of Moniepoint, Mr. Tosin Eniolorunda said the company planned to use the funds to expand into other countries in Africa including Kenya.

He also noted that the company will continue to invest in Nigeria, where it is headquartered.

“The opportunities that exist in Nigeria also exist in multiple countries,” Mr Eniolorunda told the Financial Times.

“They are at different scales and levels of development; some countries are 10 to 15 years behind Nigeria and very few are ahead. We are looking at options in our toolkit and finding which ones would be the best to launch into a country and that’s the work we’re doing right now.”

In 2023 alone, Moniepoint reportedly processed $150 billion in transaction value across 5 billion transactions as its transaction value rose by 205 percent.

 

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US Continues to dominate Global FinTech Landscape in Q3 2024, Witnesses Funding of $2.7B

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The US boasts of a bustling FinTech landscape with more than 7K funded companies and 137 active FinTech Unicorns. Though the US ranks first globally in terms of funding in the FinTech sector in Q3 2024, this is the least funded quarter in the past five years.

Q4 2021 was the highest funded quarter in this space, after which the funding started to experience a steady decline.

Tracxn, a leading global SaaS-based market intelligence platform, stated in its Geo Quarterly Report: US FinTech Q3 2024.

The US FinTech startup ecosystem raised $2.7 billion in Q3 2024, a 30% decline compared with $3.9 billion raised in Q3 2023 and a 40% decline from $4.5 billion in Q2 2024.

Late-stage funding in Q3 2024 fell 32% to $1.3 billion, from $1.9 billion raised in Q3 2023. Early-stage investments stood at $1.2 billion in Q3 2024, a drop of 29% from $1.7 billion in Q3 2023. Seed-stage funding, too, fell 49% to $186 million from $364 million in Q3 2023.

Three companies attracted funding of $200 million and above. Human Interest raised $267 million in a Series D round at a post-money valuation of $1.33 billion, while FLYR raised $225 million in a Series D round. Earned Wealth secured $200 million in a Series B round.

Three other companies reported $100M+ rounds, with Aven becoming the only new unicorn in the third quarter of this year, after raising $142 million at a valuation of $1 billion.

Finance and Accounting Tech, Payments and Investment Tech were the top-performing sectors based on funding in Q3 2024 in this space.

The Finance & Accounting Tech segment witnessed total funding of $643 million in Q3 2024, a drop of 34% compared to $967 million raised in Q3 2023.

Funding raised by the Payments sector fell 22% to $573 million in Q3 2024 from $737 million in Q3 2023. Investment Tech companies raised a total funding of $547 million in Q3 2024, 18% lower than the $669 million raised in Q3 2023.

The third quarter of 2024 was weak in terms of exits. None of the companies from the US FinTech sector went public in Q3 2024, as against one IPO each in Q3 2023 and Q2 2024.

The number of acquisitions too, fell to 48 in Q3 2024 from 54 in Q3 2023 and 62 in Q2 2024. ShareFile was acquired by Progress at a price of $875 million, and Stronghold Digital Mining was acquired by Bitfarms for $175 million.

Among US cities, San Francisco and New York City together accounted for 50% of the total funding raised by the sector in the third quarter of this year.

FinTech startups based in San Francisco raised $750.2 million, while those headquartered in New York City and Santa Monica raised $610.1 million and $225 million.

Y Combinator, Techstars and a16z are the overall top investors in this space. Y Combinator, Castle Island Ventures & Plug and Play Tech Center were the top seed-stage investors in Q3 2024, while Curql, Redpoint Ventures and Brewer Lane Ventures took the lead in early-stage investments.

The US government is taking several initiatives to stimulate investment and innovation in the FinTech sector, which could give a boost to these startups in the coming years.

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Kazang Pay Launches Card Acquiring Service in Zambia

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Kazang, the prepaid value-added services (VAS) and card acquiring business within JSE-listed fintech Lesaka Technologies, has launched its Kazang Pay card acceptance solution for merchants in Zambia. Kazang Pay makes it affordable for merchants to accept card payments on the same Kazang terminal they use to sell prepaid products and services.

The Kazang Pay enabled terminal in Zambia accepts VISA debit and credit cards as well as mobile wallet payments. Payments are settled to the merchant’s Kazang wallet on the same day. It’s as easy as letting the customer tap or insert their bank card and enter their PIN on the secure scramble PIN pad.

Kazang operates around 12,000 VAS terminals in Zambia. The goal is to enable the majority to accept card payments over the next six months. Benefits to merchants include low transaction fees and no monthly terminal rental fee for those that meet a modest monthly transaction threshold as well as the opportunity to grow their business through card acceptance.

Kazang is Zambia’s largest VAS point-of-sale terminal provider, enabling mobile money payments, bank and mobile money cash in and out, bill payments, airtime, Zesco, and many other prepaid services on one platform. The addition of card acceptance makes the platform even more comprehensive for merchants and consumers alike.

The launch of Kazang Pay in Zambia follows the introduction of the solution in South Africa, where around 60,000 small and micro merchants use Kazang Pay to accept card payments.  In Zambia, there are around 3.8 million debit, credit and ATM cards in issue and 41,000 point of sale (POS) terminals in place. The value of POS transactions has grown to K 111.4 billion by 2022 from less than K 20 billion in 2018, according to the Bank of Zambia.

Says Leon de Wit, managing director at Kazang Zambia: “Zambia has made enormous strides in terms of financial inclusion, with card usage and penetration growing at a rapid pace. With Kazang Pay, merchants can now easily accept card payments on the same all-in-one terminal they already use for vending of VAS products.

“Card transactions help merchants to grow basket sizes and potentially attract more customers, and at the same time, reduce the risks and costs of handling cash. Moving towards digitalised payments will also enable merchants to track sales, manage cash flow,  and create a footprint that could make it easier for them to access loans.”

Ashley Naidoo, director of Kazang Pay in South Africa says: “Our Zambian merchants have eagerly embraced our card acquiring service as a valuable part of our one-stop solution. Following the launch of Kazang Pay in Zambia, we have seen higher VAS sales across our merchant base and much-improved merchant retention and with our card acquiring solution we now appeal to a broader merchant base.”

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