Chipper Cash is tapping into the social payments space and has recently raised $150 million in a Series C extension round Singhtechcrunch. The company is also tapping into the market for social payments through the acquisition of a stake in a payment network called Nestcoin. In addition, the firm is laying off 12.5% of its workforce.
Chipper Cash raises $150 million in a Series C extension round
Chipper Cash is an African fintech startup with an aim to make payments in Africa easier and cheaper. The service provides no-fee peer-to-peer cross-border mobile-money transfers and facilitates intra-Africa payments in seven key Sub-Saharan countries. Its user base currently stands at four million.
In a recent funding round, Chipper Cash secured a valuation of over $2 billion. This is a significant boost to the company, which has raised US$305 million to date.
Chipper Cash offers no-fee cross-border payment services and has a customer base of four million users. Currently, the company operates in seven African nations, including Kenya, Ghana, Nigeria, Tanzania, and Uganda. Soon, the company will also be available in South Africa.
According to the latest figures, the number of international remittances to sub-Saharan Africa surpassed $42 billion last year. This figure is forecast to reach $48 billion by 2020.
Chipper Cash taps into the world of social payments
Chipper Cash is an African cross-border payments company that helps customers send money to and from Africa. It offers fee-free transactions for personal and business payments. In May, the company expanded its services to the United Kingdom.
The company’s founders, Ham Serunjogi and Maijid Moujaled, founded the company after realizing how expensive sending money to Africa was. The company is currently available in five countries, including Rwanda, Uganda, Kenya, Tanzania and South Africa.
Founded in 2011, Chipper has been on a mission to make sending and receiving money easy. Using a phone number, users can securely link a bank account or a mobile money account and collect payment. Currently, the company processes 80,000 payments per day.
The company recently partnered with Highnote, a card issuance platform, to introduce a payment solution in the US. Users will be able to open an account and transfer funds to countries where Chipper is present, like Nigeria and Zambia.
Chipper Cash’s valuation skyrocketed from $2 billion to $1.25 billion before FTX’s bankruptcy
The valuation of African fintech startup Chipper Cash fell by more than half after the insolvency of crypto exchange FTX. FTX had invested $35 million in Chipper Cash and provided another $34 million in its SAFE (Security Alliance for Financial Exchanges) scheme. In the weeks before FTX’s collapse, Chipper Cash was valued at $2 billion.
FTX was the first African-focused investment made by a crypto exchange and the first in the region. The group has processed billions of dollars in monthly remittances across Africa.
However, it is unclear whether Chipper Cash will maintain its valuation. While the firm claims to be fully unaffected by FTX’s insolvency, it has reportedly laid off a significant amount of staff to deal with a weak macroeconomic climate.
Although the company hasn’t confirmed the news, TechCrunch reported that it was laid off a significant portion of its workforce. This included 50 employees, according to the site.
Nestcoin receives venture capital from FTX and Alameda Research
Nestcoin is an African crypto startup that bills itself as a web3 gateway for Nigerians. The startup has received venture capital from FTX and Alameda Research. This has created some controversy.
Nestcoin has a mission to democratize access to economic opportunities. To achieve this, the company invests in products that make cryptocurrencies accessible. In a recent interview, the company’s CEO said that a portion of the money raised in the company’s pre-seed round is currently stuck in the now-bankrupt FTX.
Nestcoin CEO Sam Bademosi, who founded the company with Taiwo Orilogbon, is reportedly forgoing compensation for this period. However, he has no idea how much of the company’s funds are stuck in FTX.
The company is in the process of implementing a 40% pay cut for its remaining employees. They will also be furloughed for up to two months.
Chipper Cash layoffs 12.5% of its workforce
FTX is a now defunct crypto exchange that made the news for the wrong reasons. The now shuttered company was the first large investment in Africa. Aside from the fact that it may have gotten its aces up for a while, it may have also had to pay the piper for a large part of its operational expenses.
To help it recover from its loss of revenue, FTX offered to invest USD 35 M in Chipper Cash in the form of a SAFE (short for Secure, Augmented, and Formidable) fund. Although the aforementioned fund was a huge boost, it also meant that the crypto startup’s headcount was down by a full 13 percent. Its VP of Engineering, Erin Fusaro, confirmed the layoffs on LinkedIn.