What happened with the billion dollar unicorn that Iyin built ? 

It was a small idea born in a tiny office to tackle a massive problem – how to help Africans pay their bills across borders. It was giving everyone a headache, payments were slow, sometimes taking weeks for a bank to transfer money at great cost.

In that office sat down co-founders Iyin Aboyeji and Olugbenga GB Agboola with a team of techpreneurs with backgrounds in some of the largest players in banking in Africa – Standard Bank, Google Wallet, Andela and PayPal – it was anything but easy.

“It all started in a small office space in Lagos, Nigeria – with only a handful of us as a team. We thought of ourselves as a formidable team. A team that did not take “No” for an answer. A team of doers, movers, thinkers, builders and most importantly, Wavers,” writes Agboola, co-founder and CEO of Flutterwave.

What emerged was technology that made it easier for home-grown entrepreneurs Africans to build global businesses by helping them to make and take payments from anywhere across Africa and around the world. This was 2016 and the idea was unheard of.

“Before Flutterwave, the payments ecosystem was highly fragmented. It was difficult for a customer in Kenya to pay a business in South Africa. Most cross-border payments within Africa would typically be processed in North America or Europe. This drastically increased cost and ease of transfer,” says Munya Chiura, Head of Growth, Rest of Africa at Flutterwave.

They decided to call it Flutterwave – after the butterfly effect, that suggests with just one small action a greater impact can be felt in the future – much like how the fluttering wings of a butterfly in one part of the world could lead to a chain reaction leading to a tornado in another.

Like a tornado, the team at Flutterwave has grown in power by the day. They are far cry from the little office in Lagos and serve more than 300,000 customers across 34 countries including Kenya, South African, Uganda, and Tanzania. Over time they have made a staggering 140 million transactions, worth more than $9 billion. They joined an elite handful of other fintech unicorns like Interswitch, Chippa Cash and e-commerce site Jumia in March 2021

“We have the goal of making Africa feel like a country by simplifying cross-border payments…We wouldn’t want geography to limit their expansion,” says Chiura.

Key to Flutterwave’s initial success was their ability to facilitate international payments across platforms like Facebook and Uber. But it has been cheap smartphone penetration where things really kicked off.

Now, more than ever, Africa’s largely unbanked population, most in the informal sector, are getting their hands on cheap smartphones with which they can make payments and run their businesses.

“Africa itself has seen a massive leap in mobile and smartphone penetration. Smartphone sales in Africa made up 6.6% of the global smartphone market in 2019, compared with 6.3% in 2018 and 5.9% in 2017, according to IDC. The continent’s mobile usage is growing and we’re building for that,” said Chiura.

“Great strides have been made especially with brands like Mara, Tecno and Samsung as they have continued to drive down prices for devices for African consumers.”

So much so, that by2025 the African mobile market is expected to have 850 million customers driving some $2.5 trillion to $3 trillion in transaction volumes annually. 

“The future of Africa is smart. The future of Africa is technology. From payments to commerce to other consumer services, Africans can access all these opportunities with their smartphones. As people continue to see the importance of the smartphone, the rate of smartphone usage will continue to increase,” said Chiura.

One of the biggest drivers for success for the companies has come from the unlikeliest of hardships; the Covid-19 pandemic which brought about lockdowns, travel restrictions and social distancing measures. On the other side of the smartphone, these tough times have seen an increase in the number of Africans using phones to make payments.

“The pandemic has been such a surreal period sparking so many emotions for individuals and businesses across the globe. Many businesses have closed shop while others have survived or even thrived. We work with a spectrum of businesses from hospitality to transportation to e-commerce. Traditional brick and mortar businesses have struggled while e-commerce has significantly grown during the pandemic. To date, we have ove r25,000 businesses on our Flutterwave Store,” says Chiura.

The impact was felt across the continent with the likes of Chippa Cash, O-pay, Fawry, Jumia and Interswitch – that also report seeing a jump in user numbers and the value of the transactions being processed.

There is even more optimism to bank on in the future. For one, Africa is getting more connected with the likes of Google and Facebook building undersea cables; Liquid Intelligent Technologies owned by Zimbabwean entrepreneur Strive Masiyiwa’s Econet Global intends to link east to west Africa with fibre optic cable; and the likes of Elon Musk’s satellite system Starlink expected to come online within the next few years, reports the Financial Times.

Cross border payments are looking especially promising with the introduction of the Africa Continental Free Trade Area (AfCFTA) that Chiura believes will reduce the complexity of cross border payments and support businesses who will be able to transact in intra-regional trade in their local currencies.

“The Internet is a crucial part of what we do. We’re always happy with growth in internet speed and access in Africa. Of course, like every other sector, the work continues,” said Chiura.

Another flap from the butterfly wings.