Published On: Mon, Feb 24th, 2020

Nigeria’s Paga acquires Apposit, confirms Mexico and Ethiopia expansion

Nigerian digital payments startup Paga has acquired Apposit, a program growth association formed in Ethiopia, for an undisclosed amount.

That’s only partial of Paga’s news. The Lagos formed startup will also launch a remuneration products in Mexico this year and in Ethiopia imminently, CEO Tayo Oviosu told TechCrunch

The moves come a tiny over a year after Paga lifted a $10 million Series B turn and Oviosu announced a company’s vigilant to enhance globally, while vocalization during Disrupt San Francisco.

Paga will precedence Apposit — that is U.S. incorporated yet operates in Addis Ababa — to support that enlargement into East Africa and Latin America.

Repat founders

Behind a merger is a story threaded with serendipity, return, and collaboration.

Both Paga and Apposit were founded by repatriate entrepreneurs. Oviosu did his MBA during Stanford University and worked during Cisco Systems before returning to Nigeria.

Apposit CEO Adam Abate changed behind to Ethiopia 17 years ago for an assignment in a country’s Ministry of Finance, after study during Brown University and operative in fintech in New York.

“I put together a team…to build…public financial government systems for a country. And during a process…brought in my best crony Eric Chijioke…to be a technical engineer,” pronounced Abate.

The dual teamed adult with Simon Solomon in 2007 to co-found Apposit, with a concentration on building large-scale craving program for Africa.

Apposit partners (L-R) Adam Abate, Simon Solomon, Eric Chijioke, Gideon Abate

A year later, Oviosu met Chijioke when he crashed during his residence while visiting Ethiopia for a wedding. It only so happened Chijioke’s hermit was his roommate during Stanford.

That assembly began an extended review between a dual on digital-finance creation in Africa and eventually led to a Paga partnership with Apposit in 2010.

Apposit dedicated an engineering group to build Paga’s remuneration platform, Eric Chijioke became Paga’s CTO (while progressing his Apposit role) and Apposit corroborated Paga.

“We aligned ourselves as African entrepreneurs…which afterwards grown into a tighten attribute where we became…investors in Paga and strategically aligned,” pronounced Abate.

African roots, tellurian ambitions

Fast brazen a decade, and a dual companies have come flattering far. Apposit has grown a business into a group of 63 engineers and technicians and has racked adult a list of customer partnerships. The association helped record a Ethiopian Commodities Exchange and has engaged on IT and program solutions with banks non-profits and section and trebuchet companies.

For a decade, Apposit has also upheld Paga’s remuneration product development.

Paga Interfaces

Over that period, Oviosu and group went to work building Paga’s height and pushing digital remuneration adoption in Nigeria, home to Africa’s largest economy and race of 200 million.

That’s been no tiny charge deliberation Nigeria’s commission of unbanked was pegged as high as during 70% in 2011 and still lingers around 60%, according to The Global Findex database.

Paga has combined a multi-channel network to send money, pay-bills, and buy things digitally. The association has 14 million business in Nigeria who can send supports from one of Paga’s 24,411 agents or by a startup’s mobile apps.

Paga products work on iOS, Android, and simple USSD phones regulating a star, hashtag option. The association has remittance partnerships with a likes of Western Union and allows for third-party arrangement of a app.

Since inception, a startup has processed 104 million exchange value $6.6 billion, according to Oviosu.

With a acquisition, Paga absorbs Apposit’s tech capabilities and group of 63 engineers.  The association will proceed a increased capabilities and sum workforce of 530 to support expansion.

Paga skeleton a Mexico launch in 2020, according to Oviosu.

Adam Abate is now CEO of Paga Ethiopia, where Paga skeleton to go live as shortly as it gains internal regulatory approval. The East African republic of 100 million, with a continent’s seventh largest economy, is behest to turn Africa’s subsequent startup hub, yet it still lags a continent’s tech standouts — like Nigeria and Kenya — in startup formation, ISP options and VC.

Ethiopia’s bid to turn an African startup heart hinges on connectivity

Ethiopia has also been delayed to adopt digital finance, with reduction than 1% of a race regulating mobile-money, compared to 73% for Kenya, Africa’s mobile-payments leader.

Paga aims to change a financial needle in a country. “The idea is straight-forward. We wish Ethiopians to use a Paga wallet as their remuneration account. So it’s about digitizing money exchange and pushing financial services,” pronounced Oviosu.

Paga CEO Tayo Oviosu

With a Apposit merger and republic expansion, he also looks to grow Paga’s indication in Africa and beyond, as an rising markets fintech solution.

“There are several really vast countries around a universe in Africa, Latin America, Asia where these [financial inclusion] problems still exist. So a plan is not an African strategy…We wish to go where these problems exist in a vast proceed and build a tellurian payments business,” Oviosu said.

Fintech foe in Nigeria

As it grows abroad, Paga faces larger foe in Nigeria. For a final decade, South Africa and Kenya — with a success of Safaricom’s  M-Pesa product — have been Africa’s standouts in digital payments.

But over a final several years, Nigeria has turn a magnet for VC and fintech startups. This trend reached a high-point in 2019 when Chinese investors put $220 million into Opera owned OPay and Transsion corroborated PalmPay — dual fledgling startups with skeleton to scale in Nigeria and broader Africa.

That’s a large fight chest compared to Paga’s sum VC transport of $34 million, according to Crunchbase.

Oviosu names product marketplace fit and advantages from a company’s enlargement as factors that will keep it forward of these well-funded new entrants.

“That’s where a world-class record comes in,” he said.

“We also take a viewpoint that we can't build each use-case,” he pronounced — resisting Paga’s indication to Opera in Africa, that has launched mixed startup verticals around a OPay product, from ride-hailing to food-delivery.

Oviosu compares Paga’s proceed to PayPal, that allows third-party developers to figure businesses around PayPal as a remuneration solution.

With a Apposit merger and continued expansion, PayPal might turn some-more than a indication for Paga.

Founder Tayo Oviosu sees large fintech players, such as PayPal and Alipay, as destiny competitors with Paga’s skeleton to pierce into some-more rising markets.

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