Investor Updates: March 4 2022 - Africa-focused Stax gets $2m for its automated USSD app

Africa-focused Stax gets $2m for its automated USSD app

Highlights

• Stax, a startup that allows Africans to buy airtime, send and request money, and transfer funds between accounts via automated USSD codes, has raised a $2.2 million seed extension round.
• Stax has employees working from the US, the UK, Nigeria, and Kenya. Its platform is active in 10 African markets but it fully supports six countries, where over 100 banks and mobile money accounts are available for customers to use.
• U.S.-based VC firms World Within Ventures and Noemis Ventures co-led the round, which equips Stax to develop new features and expand its services from 10 African countries to 50 when it closes its Series A round.

Source: TechBuild

Our Takeaway

While internet- and application-enabled banking reaches 300 million subscribers in Africa, USSD technology which is mostly offline and used mainly by feature phones is far more popular, boasting more than 850 million connections. Per reports, over 90% of digital transactions in sub-Saharan Africa are performed through USSD, ranging from sending and receiving money to bill payments and data subscriptions.

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Egyptian legal edtech startup Kouncel raises $1.2m

Highlights

• Egyptian legal-focused edtech startup Kouncel has raised a $1.2 million pre-seed funding round to help it scale.
• Founded by Ibrahim Saleh, Kouncel is an online video education platform for lawyers, offering courses on topics like arbitration, legal drafting, and intellectual property based on different jurisdictions.
• The funding round will be used to help the startup reach more users both in Egypt and across the wider MENA region. 

Source: MyStartupWorld

Our Takeaway

As technology innovations increasingly spring up across multiple sectors and industries in Africa, the education industry has not been left out. Almost 60% of Africa’s population are under the age of 25 while the continent has an average literacy rate of 70%, lagging behind other parts of the world. These conditions indicate the region is ripe for disruptions in education, and many tech startups like Kouncel have emerged to capture this opportunity with backing from international investors too. 

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Nigerian fintech Paga expands to Ethiopia

Highlights

• Nigerian mobile payments company Paga has partnered with the Bank of Abyssinia and received regulatory approval from the National Bank of Ethiopia to launch its online payment gateway in Ethiopia.
• Founded in 2009, Paga provides Nigerians with safe and convenient ways of making payments, allowing money to be sent to any phone number for the beneficiary to redeem at a Paga agent or at an ATM via a cardless withdrawal.
• Through its online payment gateway, Paga will help drive the digital economy in Ethiopia by enabling sellers to pay and get paid easily online.

Source: Disrupt Africa

Our Takeaway

Paga’s move comes at a time when Ethiopia is moving to open up its state-controlled economy as well as accelerate the integration of banks and mobile wallets. Last May, state-run Ethio Telecom launched its mobile money service, Telebirr, which has since recorded millions of users and is connected to the Commercial Bank of Ethiopia and Bank of Abyssinia. As well as broadening access to financial services, the government aims to tap into the local payments and international remittance markets.