Africa-focused remittance fintech Zazuu shuts down
Zazuu, the fintech marketplace facilitating cross-border payment networks in Africa, has ceased operations due to its inability to secure additional funding. Despite efforts to explore various options, the company announced its closure through a LinkedIn post.
Founded in 2018, Zazuu initially raised a $200,000 seed round from Launch Africa and ODBA in August 2021. Subsequently, in the following year, the company secured $2 million in funding from investors such as Launch Africa, Founders Factory Africa, ODBA, HoaQ, and several angel investors.
Zazuu, which began as a simple chatbot on platforms like Facebook and Telegram, providing users with daily foreign exchange rates, evolved into a comprehensive aggregator. The platform listed over 17 Africa-focused remittance providers before its closure. The decision to shut down reflects the challenges faced by fintechs in the competitive landscape, despite the significant demand for solutions addressing high remittance costs in Africa, where the average rate for sending money from Europe is notably high.
Key Takeaways
The closure of Zazuu is part of a trend in the African tech ecosystem, where several startups have shut down this year due to drying up funding. By the end of October, the total funding raised by African startups was less than $2.8 billion for the year, representing less than half of the $6 billion raised in the previous year. This trend highlights the challenges that some startups in the region face in sustaining operations and scaling their businesses in a competitive and dynamic environment. Other examples of startups facing closure due to funding issues include Lazerpay, a crypto startup that shut down in April, and WhereIsMyTransport, a South African mobility startup that closed its doors in October, citing difficulties in securing new funding. Zazuu specifically, reportedly encountered challenges in articulating its vision to customers and potential partners as well as securing licensing requirements due to the associated costs, contributing to the complexities of its operations.
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