Stitch, a prominent players building and operating APIs in Africa has secured $21 million in Series A funding.
This was after the $4 million Stitch raised out of stealth in February 2021, a prequel to the $2 million extension round it secured four months ago, bringing its seed round to $6 million.
Stitch has raised $27 million in total to date.
The API fintech in South Africa allows organisations to create, develop, and grow financial products. With the new capital, the company wants to develop a “financial graph” ecosystem across Africa, according to a statement made by the company.
The financial graph, according to the company, is an architecture for financial building blocks that enables businesses to develop code once, launch in numerous markets, and scale more quickly thanks to interoperability between geographies, providers, banks, and other forms of financial accounts.
Stitch’s specialises in e-commerce, marketplaces, and platforms, as well as fintechs, which are its most important clients.
As in previous years, African fintechs outpaced other firms in terms of raising venture money, particularly in 2021, when they raised 50-60% of overall VC funding, according to reports.
Stitch debuted its payments solution in South Africa in April 2021, and the next six months saw a 50 percent increase in payments volume month over month.
Stitch launched its payment service in Nigeria in October, with plans to process $10 million in monthly payments by the end of the year.
Pillay, who co-founded Stitch with Natalie Cuthbert and Priyen Pillay, didn’t provide an update on this measure during the call, but did say that since introducing the product last April, Stitch had witnessed a 104 percent month-over-month growth in payments value.
In Q4 2021, the platform had a 44 percent month-over-month increase in customers and a 72 percent increase in linked financial accounts.
“As we continue to develop the payments offering and look at monthly and recurring payments, which are fascinating feature sets for us,” Pillay said, “we’re proud of the partners and customers we have here.”
“A handful of our customers recently went live in Nigeria, which has been quite exciting for us.” We just accept payments there, but we’re keen to expand our offerings. This year, we’ll look into adding data and identity, as well as expanding the payment system in the same way that we do in South Africa.”
The Spruce House Partnership, a long-term investment business based in New York, led this round of fundraising. PayPal Ventures, TrueLayer, firstminute capital, The Raba Partnership, CRE Venture Capital, Village Global, as well as fintech founders and firms including TrueLayer, founders of Chipper Cash, Quovo, and Unit, and Guillaume Pousaz’s Zinal Growth, all participated in the round.
“We’ve been watching African startups for a long time. “Our due diligence revealed that this is one of the most talented teams on the continent, and we are pleased to be a part of what they are creating at Stitch,” Ben Stein, co-founder of The Spruce House Partnership, stated.
Stitch said the funding will allow it to expand its team across offices in Cape Town, Johannesburg and Lagos, create new product offerings and enter new markets across the continent.
