Stripe has acquired Nigerian fintech startup Paystack for over $200 million. The deal will see the global market leaders in online transactions expand to the African markets.
Paystack has been a Nigerian success story in the making for the last five years, after emerging from the Y combinator incubator. In fact, it was the first Nigerian company to come out of the highly revered start-up incubator.
Stripe acquisition of Paystack
Its founders, Shola Akinlade and Ezra Olubi, launched the company in January 2016 in Nigeria, promising to deliver a safe and secure way of integrating payment services for both online and offline transactions.
Five years later, the company has attracted a buyer who has seen the company’s potential as it tries to expand into other regions of Africa.
Stripe and Paystack reached a deal worth more than $200 million that will see the global online payment gateway leader own the Nigerian startup as part of its long term goal of expanding to other geographics. Paystack, which currently has more than 60,000 customers, and used by institutions such as governments, fintech, small businesses and larger corporations, has stamped its mark in Africa’s largest country by population and economy.
Patrick Collison, Stripe’s co-founder and CEO, said that the acquisition would help Stripe expand to other geographics. He continued by saying that Africa’s internet payment market was one of the fastest-growing in the world at 30 percent per annum. He also indicated that the pace of online shoppers in Africa was growing at twice the rate for the rest of the world, further highlighting an important aspect of why the deal made sense.
Stripe and Paystack have engaged in business in the past, whereby in 2018, Stripe led Paystack $8 million for expansion and Stripe has already indicated that it will allow the company to continue its growth in Africa independently. They have also indicated that in the future, they will consider adding the company to their Global Payments and Treasury Network (GPTN), a programmable platform for global money movement that currently spans 42 countries as part of their expansion project.
Featured image by Pixabay