BusinessDay

How 10 Nigerian startups have fared after Y Combinator funding

Since 2016, when Y Combinator made its first investment in Nigerian-based Flutterwave, it has not looked back. It now counts 30 Nigerian tech companies as part of its portfolio.

Year on year, the startup accelerator runs two categories of funding projects known as the summer (S) and winter (W) batches, and some beneficiaries including Nigerian owned startups- 54Gene, Mono, Paystack, Flutterwave, Helium Health, among others have participated.

Founded in March 2005, Y Combinator is a famous startup accelerator, which selects tech startups to take part in its programme twice yearly. Seed funding is the accelerator’s earliest stage of venture funding used to pay companies’ expenses while getting started.

While some companies may need no more than seed funding, others go through several rounds. For the purpose of this, 10 startups who have featured in Y Combinator’s funding are being highlighted in terms of their expansion and acquisitions.

Nigeria accounts for 50 percent of the 60 tech companies from Africa that have received funding from Y Combinator. Out of the 30 are Nigerian-based and owned companies, fintechs make up 50 percent, healthtech-16.6 percent, Agritech-10 percent, crypto, logistics and autotech-6.6 percent each, while edutech makes up 3.3 percent.

We looked at how ten of the startups have grown since they got investment from Y Combinator.

54Gene (healthtech)

54Gene participated in the W19 funding project shortly after its inception in 2019 by Abasi Ene-Obong and Ogochukwu Francis Osifo. 54Gene is African genomics research, services, and development company that addresses the need to include under-represented African genomic data in research that could lead to medical breakthroughs and new healthcare solutions worldwide.

The startup raised $150,000 twice in March 2019 as its first funding, and is seen to be making progress. It made the Time Magazine list of 12 innovations that would change healthcare in the 2020s and was listed as one of five innovations that would improve healthcare for Africans.

In January 2021, it unveiled a new lab in Lagos, capable of human whole-genome sequencing and a variety of other scientific investigations, and started operations immediately. This is to enable Africans to conduct genomics research. In September 2021, 54Gene announced it raised $25 million in a Series B funding round which happens to be their latest funding.

Helium Health (healthtech)

Helium Health provides a range of technology for healthcare providers, payers and patients across Africa which include maiden electronic medical records (EMR) and hospital management information system (HMIS) for emerging markets.

Founded in 2016 by Adegoke Olubisi as ‘One medical’, the company was accepted into Y Combinator having joined the S17 funding batch and rebranded to Helium Health in May 2017 and a two million seed round was closed in the same year.

In 2018, Helium health launched its EMR product widely to great adoption by private and public facilities across Nigeria which led to their acquisition of MedicPlus and SmartDoctor who are EMR providers in Nigeria.

With a total of $12.2 million in funding over 5 rounds, the company recently acquired Meddy on November 10, 2021.

Cowrywise (fintech)

Cowrywise leverages technology and investment management to re-imagine how financial planning, savings, and investment products are delivered to people in a simple, secure and affordable manner.

Co-founded by Razaq Ahmed and Edward Popoola in 2017, Cowrywise has raised a total of $3.3 million in funding over 6 rounds. Their latest funding was raised on January 28, 2021, from a Seed round.

After its participation in S18 of Y Combinator’s funding, the company launched various retail investment schemes, and it says it now has up to 21 mutual funds with various risk categories, and up to 300,000 people now use Cowrywise in 2021.

A major milestone for the company was when it secured an asset management licence from the Securities and Exchange Commission (SEC). This enabled the company to manage funds and investment portfolios on behalf of retail investors, as only companies with such a licence can develop and operate any product that pools investor funds.

Paystack (fintech)

Paystack as a fintech company allows businesses to accept payments via credit card, debit card, money transfer, and mobile money on their websites or mobile applications.

Founded in 2015, co-founders include Shola Akinlade and Ezra Olubi, with its total funding raised at $10.4 million over five rounds as of August 2018, after it joined the W16 funding batch.

Following the acquisition of Paystack by Stripe in October 2020, the company relaunched its eCommerce store for sole entrepreneurs and small businesses, updated a feature for subscription-based businesses to better track customer cards that are about to expire, and has become a payment option for vendors

using WooCommerce, a plug-in owned by WordPress.

In September 2021, Paystack became the first payment gateway in Africa to become an Apple Pay partner. The integration allowed businesses that use Paystack to receive payments from 380 million Apple Pay users in about 60 countries.

Flutterwave (fintech)

Flutterwave is a payment company that enables businesses to make and accept payments from anywhere in Africa. It participated in the S16 funding batch months after it began operations.

Co-founded by Olugbenga Agboola and Iyinioluwa Aboyeji in 2016, Flutterwave has grown to become one of the fastest-growing payments companies in the world. Since its inception, Flutterwave has processed close to $2 billion in payments and 25 million transactions across over 33 African countries where it currently operates.

In 2017 Flutterwave was named Africa’s best fintech company at the Apps Africa Innovation Awards. Their latest funding, $170 million was raised in March, 2021 from a Series C round which saw the company attain a Unicorn status.

In November and December of the same year, Flutterwave acquired Disha, and, speaking of investment, the company invested in CINETPAY in a seed round valued at $2.4 million.

Other than payments solutions, several products including Flutterwave Store, an online marketplace for merchants, Flutterwave Grow, which helps users register and incorporate their businesses in the US and UK, and Flutterwave Mobile, an app that allows medium and small medium enterprises use their phones as point-on-sale (POS) machines have been launched.

To round off the year 2021, the company launched its latest product, Send to take payment services to the global level and this will be achieved by its collaboration with popular Nigerian artist Wizkid. With his fanbase, Wizkid will help drive Flutterwave’s goal to increase global awareness of the affordable remittance service.

Mono (fintech)

Mono is an application programming interface (API) startup that allows companies to access data from their customers bank accounts as well as debit money from these same bank accounts.

The one-year-old startup co-founded by Abdul Hassan, a former product manager at Paystack, and Prakhar Singh has raised $17.65 million in total funding to date.

The company’s mission is to go beyond banking, by making it possible to access financial accounts for data from multiple financial and non-financial sources. This can help digital businesses build innovative and more inclusive financial services.

Exactly a year after inception, it raised a $15 million Series A funding round and its API technology acts as a testament to its capabilities. Mono has signed on customers that cut across health and lending. Some of them include Carbon, OnePipe, Swipe, Anyi Health, Flutterwave, and a variety of developers.

Wallets (fintech)

Wallets A is a borderless digital bank for Africa that provides a seamless experience to users and builds on new payments infrastructure. The platform enables people – Africans and foreigners – to spend locally across the continent without having to create an account with a local bank.

After it started operations in 2019 with John Oke as founder, it participated in the W19 funding batch. The startup prides itself as a Y Combinator alumni which contributes greatly to the company’s progress according to the company.

It was recognised as the best electronic payment website in Nigeria in 2019 by Nigeria internet Registration Association (NiRA), as well as one of 100 leading global innovators in financial services by KPMG, and the top 100 small and medium enterprises (SMEs) in Nigeria in 2020 by Business Day.

Kobo360 (logistics)

Kobo is a technology company providing SMEs with solutions to challenges faced with their ability to scale. These solutions drive efficiency and growth in the logistics space by connecting asset owners in the industry with the SMEs that need their services.

Following its participation in the S18 funding batch, Kobo is preparing to enter the agro-trading space by developing a marketplace that connects farmers with buyers all over the world. The marketplace will eliminate the high cost of middlemen for smallholder farmers and increase their profits.

The company was co-founded by Ife Oyedele and Obi Ozor in 2016 and claims it has over 10,000 drivers and trucks operating on its app, as well as clients including Honeywell, Olam, Unilever, Dangote, among others.

Vendease (agritech)

Vendease is a marketplace that lets restaurants in Africa, order directly from farms and food manufacturers.

Instead of going through expensive middlemen, vendors, or sending staff to open markets with hiked prices, restaurants can now get on their platform, click to order and get all their food supplies within 24hrs.

Since its inception in January 2020 by four friends- Tunde Kara, Olumide Fayankin, Gatumi Aliyu and Wale Oyepeju, the startup is solving Africa’s food supply chain problems by digitising procurement processes, storage operations and logistics, and offering flexible payment systems to help food businesses grow.

The most recent Y Combinator’s funding- W21 featured Vendease and in December 2021, the company announced its intention of being the Amazon for Nigeria’s food vendors with the seed round of $3.2 million raised in October 2021.

Its technology doesn’t just allow food businesses to place orders for food supplies, it also tracks them, as well as manage inventory, track expenses and gain access to credit facilities.

Releaf (agritech)

Releaf develops novel industrial processing technology for African crops. This is a pre-processing technology that allows farmers to improve the quality and scale of raw materials provided to African food factories.

The company targets domestic demand in industries where it can develop pre-processing technology to increase the amount of addressable, quality raw material that can be sourced directly from farmers.

Founded in 2017 by Uzoma Ayogu and Ikenna Nzewi, the startup palm nut processing technology has gained popularity with novel financing capabilities to revolutionize the continent’s decentralized food production sector.

It recently secured a $4.2 million seed round in September 2021 to solve the distance and logistics problems between farmers and consumers making its total funding amount at $5.7 million.

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