Stripe, a global payments leader,financial services and software company has acquired Nigeria’s start-up, Paystack in a deal estimated to be about $200 million.
The acquisition is expected to make online and offline payments easier for African businesses, and enable more global companies to enter the fast-growing region.
Paystack powers payments for thousands of companies of all sizes – including FedEx, UPS and MTN – and processes over 50% of all online payments in Nigeria, Africa’s largest market.
Stripe is a technology company that builds economic infrastructure for the internet. Millions of businesses in 42 countries are using Stripe to process hundreds of billions of dollars across the globe
The African internet economy is growing quickly, with online commerce in the region growing 21% year-over-year, 75% faster than the global average. In order to help grow Africa’s online GDP, Stripe has entered into an agreement to acquire Paystack, a technology company based in Lagos that makes it easy for organizations of all sizes to collect payments from around the world.
Today, more than 60,000 businesses in Nigeria and Ghana use Paystack to securely collect online and offline payments, launch new business models, and deepen customer relationships. Incredibly, Paystack already processes more than half of all online transactions in Nigeria. Paystack has ambitious plans to expand across the continent and recently started a pilot with businesses in South Africa.
Stripe and Paystack have been working closely together for some time. In 2018, Stripe led Paystack’s Series A financing round and has provided ongoing guidance as the company rapidly scaled.
“In just five years, Paystack has done what many companies could not achieve in decades. Their tech-first approach, values, and ambition greatly align with our own. This acquisition will give Paystack resources to develop new products, support more businesses and consolidate the hyper-fragmented African payments market,” said Matt Henderson, Stripe’s business lead in EMEA. “We can’t wait to see what they will build next and how their growth can turbocharge the African tech ecosystem.”
Paystack will continue to operate independently, growing their operations in Africa and adding more international payment methods. Over time, Paystack’s capabilities will be embedded in Stripe’s Global Payments and Treasury Network (GPTN), a programmable platform for global money movement that currently spans 42 countries.
“Paystack is a growth engine for modern businesses in Africa, and we couldn’t be more excited to join forces with Stripe, whose mission and values are so aligned with ours, to nurture transformative businesses on the continent,” said Shola Akinlade, CEO and co-founder of Paystack.
“We believe deeply that with the right tools, African creators, developers, and entrepreneurs can do incredible things. Leveraging Stripe’s resources and deep expertise, we’re excited to accelerate our geographic expansion and introduce more payment channels, more value-added services, and deeper integrations with global platforms.”
Stripe’s co-founder and CEO, Patrick Collison, said: “In absolute numbers, Africa may be smaller right now than other regions, but online commerce will grow about 30 per cent every year. And even with wider global declines, online shoppers are growing twice as fast. 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.”
The acquisition is subject to standard closing conditions, including regulatory approvals.
Paystack is a technology company powering growth for incredible businesses in Africa. Paystack helps businesses in Africa get paid by anyone, anywhere in the world. Paystack processes over 50% of all web payments in Nigeria, powering payments for over 60,000 organizations, including FedEx, UPS, MTN, and many others.
Businesses use Paystack to accept both online and offline payments through payment channels such as ATM cards, mobile money, USSD, QR code, and more. Businesses also rely on Paystack’s powerful APIs for everything from transfers to automated user verification. Founded in 2015 and launched in January 2016 by Shola Akinlade (CEO) and Ezra Olubi (CTO), Paystack was the first Nigerian company to be accepted into Y Combinator. The company is headquartered in Lagos, Nigeria and has raised over $10 million from both international and local investors including Stripe, Visa, Tencent, Y Combinator, Comcast Ventures Catalyst Fund, Blue Haven Ventures, and Ventures Platform.