September 5, 2021

Flight Plan #005— Our Investment in Chipper Cash

Our investment notes for Chipper Cash a cross-border mobile payments solution for Africa

Written by

Stew Glynn

TEN13 has completed it’s 5th investment into exciting African fintech Chipper Cash, who’s mission is to make sending money across Africa as fast, easy and safe as possible. We’re excited to join their latest US$13.8m Series A round as announced on TechCrunch here.

Growing up in Africa (Zimbabwe), I saw the problems first-hand of poor financial infrastructure and limited financial access. The transfer of money within country in Africa is hard and transferring money across borders is even harder. There are limited solutions available and either involve legacy providers with exorbitant fees (think: Western Union) or unofficial and unregulated markets which increase risk (think: black market dealing).

I met Ham and Maijid in early 2019 in San Francisco, and after hearing them talk about their plans — it was clear of the potential opportunity they were working on. Chipper Cash has the vision to create and connect an international cross-border payments network across Africa, making the US$300bn transferred annually across mobile money providers and currencies as seamless as sending a text message. They are a payments company, headquartered in the US, that is building the cash app of Africa like WeChatPay (China), PayTM (India), Venmo & CashApp (US).

We invested in their Seed Round lead by Deciens in February 2019 post 500 Startups graduation and followed-on in their US$6m post-seed financing round in October as reported by TechCrunch. Having seen them surpass 1.5 million users, increase their monthly transaction volume to over US$100m per month and become the #1 Fintech app in the Play Store in Nigeria, we are back again to triple down on Chipper Cash in their Series A through our new investment brand TEN13

The Problem:

High transaction costs: Sub-Saharan Africa (SSA) has the highest transaction costs anywhere in the world. This is because organisations such as Western Union and MoneyGram have extensive agent networks and that need to be paid at both ends of the transactions plus take their own fee, and are usually via cash-based transactions. This all results in material costs to the end-user and a high friction process.

Interoperability: Transferring money is a painful process because most mobile money providers do not integrate with each other and you cannot transfer money between mobile wallets. Governments in Africa have been pushing mobile money providers to become interoperable but this process is still in its infancy. Most mobile money providers are still not interoperable and the process of transferring money both locally and abroad is cumbersome.

The Solution:

Chipper Cash has developed a mobile payments platform that sits a layer above the mobile money providers, allowing users to seamlessly pull money from their mobile money accounts and then transfer that money across borders and across different mobile money wallets in a seamless manner.

Users can download the app, create an account, and immediately begin syncing each of the mobile money wallets and bank accounts, bringing everything into the one platform. Once onboard, the experience is seamless for transferring funds — their product experience is reflective of their plans; making the exchange of payments as easy as sending a text message.

They’ve started with cross-border payments, but are expanding into other exciting verticals soon — watch this space.

Market Timing:

We believe that it is a great time for Chipper to be going after this market. They are benefiting from the rising tide of smartphone penetration and financial access as more and more people gain access to mobile money and mobile transactions. This trend is growing the mobile market in SSA by 5% annually (20m new users year) and is forecasted to reach 600m Sub-Saharan Africans by 2025 (or 2/3 of the African continent), with the fastest growth occurring in Nigeria (Chipper Cash’s largest market) at 19% per year.

World-class team:

We love backing founders who have strong technical nous, a deeply product-centric focus and ambition to execute on a truly world-changing vision. Having spent time with co-founders Ham Serunjogi — CEO (ex-Facebook) and Maijid Moujaled — Head of Product (ex-Yahoo, Flickr & Imgur) — we were sold that the co-founding duo had the right intensity, skillset and ambition to change the way Africa transacts money across borders.

The founders are homegrown in Africa (Uganda and Ghana), but have first-world experience in leading technology companies and are extremely passionate about their mission to solve this problem on their home continent.

They have a compelling story to tell and are attracting world-class talent to their team as a result. Here are just some of the amazing talent they have brought onboard:

  • Patrick Triest — CTO (ex Google)
  • Marc Gottschalk — General Counsel (25 year lawyer — Ex Partner at Sidley Austin LLC)
  • Lisa Dawson: Chief Compliance Officer (ex Global Head AML Advisory at Citi, Booz Allen Hamilton)
  • Alicia Levine: COO (ex Twilio; BRCK, ex-COO of Kenyan broadband company)
  • Hasan Luongo: VP Growth (ex Honey, Voicea, Fairy)

We are super excited to be partnering with Chipper Cash once again. It is rare to see a company which so regularly outgrows its own forecasts and continues to scale month after month. On a personal note, it is rarer still in VC to invest in a company which hits so close to home. I look forward to using Chipper on my next family trip to Africa.

Safe Travels,
Stew Glynn, Partner @ TEN13.

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