An increasing crop of successful African fintech startups have previously taken part in the Y Combinator series. Leading examples are Flutterwave, Flux, Bamboo, Cowrywise, Credpal, Paystack, among others.
Another Y Combinator prodigee of it’s Summer 2020 batch, Afriex has raised $1.2 million in a seed round led by Launch Africa, an Africa-focussed VC fund, alongside Future Africa, Uncommon Ventures, SoftBank Opportunity Fund, Precursor Ventures, Ivernet Holdings, Y Combinator, A$AP Capital, and Brightstone VC. Several noteworthy angel investors also took part in the round. The funding will go into additional team members, and the entry into new markets with a large number of African immigrants.
The San Fransisco-based fintech was founded in 2019 by John Obirije and Tope Alabi to provide P2P money transfer services for Africans in the diaspora to those in the continent at zero transfer fees. Users can easily deposit cash on the app, then transfer the money to another user. The funds can then be withdrawn to any connected bank or debit card.
Afriex is a crypto remittance platform targeting immigrants of African descent. The company has reported a growth of 20X in 2020 alone. App users can deposit cash, send money to bank accounts and other users, or withdraw funds from bank or debit cards.
Afriex runs a similar model to other crypto remittance platforms. It bases its business foundation on stablecoins (that are dollar-backed). This is different from othe rfintechs such as WesternUnion and TransferWise whose business model operates on the tradional banking systems.
According to TechCrunch, the startup claims to move over $500,000 worth of transaction fees every month and is widely used across 30 countries. What began operating in Nigeria and the US has now opened offices in Kenya, Ghana, and Uganda, handling a combined transition volume in the millions of dollars every month.