Stripe Acquires Nigerian Startup Paystack to Accelerate Online and Offline Commerce Across Africa
Photo Credit: Twitter / @TechCabal
TechCrunch reports earlier this year, Stripe announced they had picked up an additional $600 million in funding and is standing on its reason – to expand its API-based payments services into more geographies.
Currently, Paystack has around 60,000 customers which include fintechs, educational institutions, larger corporates, and online betting companies. According to the company, their plan is to continue to operate independently.
While the terms of the deal have not been disclosed — according to TechCrunch — sources close have confirmed that it’s over $200 million. The new deal is Stripe’s largest acquisition to date anywhere, and the biggest startup acquisition — to date — to come out of Nigeria.
“There is enormous opportunity,” said Stripe’s co-founder and CEO, Patrick Collision, in an interview with TechCrunch. “In absolute numbers, Africa may be smaller right now than other regions, but online commerce will grow about 30% every year. And even with wider global declines, online shoppers are growing twice as fast.”
He also adds: “Stripe thinks on a longer time horizon than others because we are an infrastructure company. We are thinking of what the world will look like in 2040-2050.”
With Paystack, this deal gives the company more fuel to further build out in Nigeria and expand to other markets, per the company’s CEO Shola Akinlade.
“Paystack was not for sale when Stripe approached us,” said Akinlade. “For us, it’s about the mission to accelerate payments on the continent, and I am convinced that Stripe will help us get there faster. It is a very natural move.”
This deal emphasizes two unique points about Stripe which is now valued at $36 billion, and regularly tipped as an IPO candidate. One focus is on how it is putting a bet on the emerging markets of Africa, mainly the future of its own growth. The second point to note is how Stripe doubles down on geographic expansion.
For the last several years, Stripe has made a number of investments into startups building businesses or technology in areas where Stripe has yet to move. This year’s investments include backing the Philippines-based payment platform, PayMongo, and universal checkout service, Fast.