Payments-led Ivorian fintech startup Julaya extended its $5 million pre-Series A round. The company, which facilitates B2B payments for businesses in Francophone West Africa, primarily through mobile money channels, raised a total of $7 million in the funding round.
In 2019, West Africa reported the most active mobile money services of any region, with 56 million active accounts. In Côte d’Ivoire, one of the largest mobile money markets in Francophone Africa, 75% of the population has a mobile money account, compared to 20% who have bank accounts. This is why Julaya launched its services in this West African country and has since expanded to Senegal, where mobile market penetration is around 80%, as well as other countries in the WAEMU (West African Economic and Monetary Union), which also have widespread use of mobile money.
Small and large businesses in these countries can use the Julaya platform to make bulk payments to other businesses and their unbanked employees through existing mobile money channels. But they can now access more services, for example, the startup’s prepaid card – issued by Mastercard – for managing company expenses. The cards are suitable for corporate travel needs, other online spending, and easy import of transactions into their accounting systems, CEO Mathias Leopoldie said Metaverse Marketing in an interview.
“Our direction or our strategy with the cards is to provide a full range of services. Because if you only have cards, I don’t think you can create a big startup with a lot of traction like you would like, for example, in the United States, ”said the managing director, who founded the business with Charles Talbot. “The card payment industry, with the exception of South Africa, maybe Nigeria and a bit of Egypt, is developing and even if you can develop a business on that, it’s is almost impossible in our area. [Francophone Africa].”
Leopoldie said offering cards — most of which are physical (at customer demand) — isn’t Julaya’s main strategy for revenue growth. It’s a cost-shifting strategy that he says differentiates fintech from competitors such as YC-backed, which see cards as the primary driver.
More than 40% of Julaya’s 500 small and medium-sized enterprises (SMEs), startups, large enterprises, and government institutions use its enterprise expense management feature. While the largest volumes come from medium and large enterprises, fintech has surprisingly seen greater adoption from its small traditional and non-digitalized customers, Leopoldie noted.
Over the past year, the Franco-Ivorian startup has also expanded its product range to include a “Cash & Collect” solution that allows for “fast and secure” collection, particularly in the FMCG sector. Here, businesses can deposit their money from physical and field sales into their Julaya account through a mobile money agent branch without going to a bank.
Last July, Leopoldie said the fintech was processing more than $1.5 million per month. Those numbers increased five-fold to more than $7.5 million, with revenue seeing an identical growth of more than 500% year-over-year. Brands such as Jumia and Sendy are among Julaya’s clients.
European venture capital fund Speedinvest led Julaya’s pre-Series A expansion round. EQ2 Ventures, Kibo Ventures, angel syndicates Unpopular Ventures and Jedar Capital, existing investors Orange Ventures, Saviu, 50 Partners and Ivorian business angel Mohamed Diabi and professional footballer Édouard Mendy also invested in the round.
Mendy’s participation – his first in Africa and second worldwide – highlights the growing involvement of athletes in the venture capital scene in Africa. This week, Metaverse Marketing introduced Byld Ventures, a $15 million fund for African fintechs. A striking news observation was the number of athletes involved as corporate sponsors; some have also made direct investments from various reports. Mendy is African, unlike the others who are mainly European. While he could be one of the first African athletes to support startups, Leopoldie assumes there will be more examples for the foreseeable future.
“I think he’s a bit ahead of the curve. We see that football stars, or wealthy people in the sports industry, are beginning to realize that they need to invest in venture capital for two reasons. The first is that although it is a risky asset, it brings excellent returns. And second, they should use their image to show that they don’t just care about their sporting career, but want to be an inspiration to their home country. It was significant for Édouard Mendy because he is Senegalese.
Julaya also received an investment from its CFO and country manager in Senegal. Proceeds from this funding round will help the fintech continue its expansion plans across Francophone West Africa as it plans to open offices in Benin, Togo and Burkina Faso, hire talent and stimulate product development.
Enrique Martinez-Hausmann, director of lead investor Speedinvest, said the firm’s holding company is changing the way businesses operate in a complex payments landscape across the Francophonie, which also includes well-known players such as CinetPay. and Bizao. « Going forward, the potential of Julaya’s technology goes well beyond its payment capabilities, having the opportunity to become a close banking partner for West African businesses,” Martinez- Hausmann.