US-Nigerian fintech company Flutterwave has created an e-commerce platform to help African companies during the Covid-19 pandemic. Flutterwave is the latest start-up to see opportunities in the restrictions imposed as a result of the coronavirus.
Flutterwave CEO Olugbenga Agboola witnessed how the temporary lockdowns across the continent were disrupting businesses it worked with. He also noted the impact on smaller shops, many of which were not yet operating online, along with the greater demand for e-commerce.
In response, Flutterwave devised an e-commerce platform to enable businesses set up their shops online, with payments and delivery integrated.
According to the International Finance Corporation, up to 90% of businesses in sub-Saharan Africa are small- and medium-sized enterprises.
Meanwhile, a study by the market research firm Kantar found that nearly three in five consumers in Nigeria planned to increase their online shopping in the future. This represented the biggest increase of all the countries in its survey, which polled 45,000 consumers globally.
How Covid-19 has Affected Flutterwave and other Start-ups.
Since its launch in April, Flutterwave said that more than 1,000 businesses had created accounts on its e-commerce platform. These businesses are in Ghana, Nigeria, Kenya, and some other countries in Africa.
Agboola said that one of the biggest lessons he had learned from developing and launching a new part of the business while in lockdown was to “over communicate and be upfront with the team” about how the coronavirus pandemic had impacted the company.
While most businesses were experiencing negative effects from the pandemic, Agboola said it was also a great time to re-evaluate your strategy. Get to know your product and fix what is not working.
Flutterwave is not the only technology company tapping into the e-commerce boom during the pandemic in Africa. Jumia, dubbed the “Amazon of Africa,” has expanded and launched its platform in South Africa in April, selling essential products.
Old and New Grounds
Flutterwave’s expansion into e-commerce builds on its existing payments services business, facilitating global transactions in local currencies in Africa.
Sub-Saharan Africa is thought to be one of the world’s fastest-growing digital payments markets. It has the largest population of underbanked and unbanked people in the world.
Flutterwave was established in 2016 by a team of ex-bankers, entrepreneurs, engineers. This included Agboola, whose background is as a software engineer working for the likes of PayPal. He took over as CEO from co-founder Iyinoluwa Aboyeji in 2018.
The fintech firm started out in San Francisco. However, after taking part in the prestigious start-up accelerator YCombinator, it set up its operational headquarters in Lagos, Nigeria.
Flutterwave says it is now worth over $200 million having raised $35 million in its last fundraising round in January in partnership with WorldPay and Visa.