Last week, the mobile payments company executed its venture into the American market with its acquisition of US-based Global Technology Partners. Today, MFS Africa announces the close of a $100 million Series C extension round. This round, which is a combination of debt and equity, raises its entire Series C raise to over $200 million. The company had earlier raised $100 million in November of last year, to drive its expansion across the continent.
The round was led by private equity firm, Admaius Capital Partners, with Vitruvian Partners (its first investment in Africa) and the alternative investments arm of AXA Investment Managers (AXA IM Alts) as new investors in the extension round. Other investors like AfricInvest FIVE and CommerzVentures, also reinvested more money, with Stanbic IBTC Bank Nigeria and Symbiotic providing debt financing. In previous rounds, MFS Africa has been backed by LUN Partners Group, Goodwell Investments, Allan Gray Ventures, Endeavor Catalyst, and Endeavor Harvest, Equator Capital Partners, Ulme B.V., and Vlemeij B.V.
MFS Africa: Driving forward with resilience
As with its acquisition last week, MFS Africa is dedicated to keeping on track with its growth across various geographical markets. Prior to its acquisition of Global Technology Partners, the company had earlier acquired BAXI in Nigeria and had gotten licenses from the Central Bank of Nigeria, including a Payment Service Solution Provider (PSSP) license and a Payment Terminal Service Provider (PTSP) license to execute on its digital payment infrastructure within the country. These licenses also serve to enable it to build payment processing gateways and aggregate merchants, while deploying point-of-sale terminals for its agency banking.
MFS Africa in a press statement, as reported by Techcabal, highlights that this extension will help “accelerate MFS Africa’s expansion plans across Africa, its integration into the global digital payment ecosystem, its expansion into Asia through its joint venture with LUN Partners to enable cross-border digital payments between Africa and China, and its ambitious growth plans for the BAXI network of merchants and agents in Nigeria and beyond.”
MFS Africa also intends to deploy this funding in consolidating its growth in Nigeria through BAXI. The funds are intended to drive four objectives, namely, to continue its expansion plans across Africa, to further integrate its global digital payment ecosystem, to expand into Asia and enable cross-border payments synergies for both continents, and finally to execute its growth plans for BAXI.
Quoted by Techcabal, Dare Okoudjou states,
“We have done something pretty unorthodox which is to do 2 major M&As in two difficult markets,” referring to the BAXI and GTP acquisitions, “For now it’s going to be more about how do we integrate into one company and make sure we realise synergy.”
The company had earlier hired Meghan Taylor, a former partner at Boston Consulting Group, as its Chief of Staff to spearhead the process of integrating the three company visions, and championing its growth. Julian Adkins, formerly Africa CFO at Millicom (Tigo) also joins the team as its Chief Financial Officer.
The company is firm on its goal of building a long-lasting and value-driven digital payments infrastructure that will ensure that payments in Africa are simplified and made easy.
As Okoudjou says further in a statement,
The strength of our business model is grounded on building a lasting digital infrastructure that unleashes and simplifies economic activities across the continent through any-to-any interoperability. Our multiple initiatives and solutions are providing access to Africans, at home and in the diaspora. We are building MFS Africa into a safe, sound, scalable and high-impact pan-African payment infrastructure that will facilitate Africa’s rapidly growing commerce, both now and in the future.
Explaining the reasons for the extension round, Okoudjou highlighted how they had to accommodate other investors who had been interested in joining their Series C round. As quoted by Techcabal, he further highlights, “There were some of these investors who were interested in joining the [Series] C round. They just couldn’t get there at that time when we closed it, so we have kept the conversation going knowing that we would need future capital anyway.”
With global market tempers showing a funding crunch for startups, it is crucial for startups to remain driven for growth while ensuring that they are not burning cash unnecessarily. Part of this demand is that startups are constantly innovating to match the challenges of their proximate markets, so as to continually offer value.