Startup snapshot: Nigeria’s Paystack wants to modernise payments, and they’ve raised $10m to do it

Shola Akinlade

Nigeria-based Paystack is a fintech startup that lets businesses accept payments via credit card, debit card, money transfer and mobile money on their websites or mobile apps. Shola Akinlade, co-founder and CEO, answers our questions.

1. Give us your elevator pitch.

Paystack provides modern online and offline payments for businesses in Africa. Over 17,000 organisations of all sizes – from startups to government agencies – trust Paystack to provide a secure, delightful payments experience for customers. In addition to payments, Paystack provides growth tools to help businesses acquire, engage, and retain customers.

2. How did you finance your startup?

We spent the first year in 2015 (before fundraising) building out the software using our personal funds. By the end of the year, we got into Y Combinator, a Silicon Valley accelerator and received US$120,000. Paystack raised a seed round of $1.3m in December 2016 from local and international investors including Tencent, Comcast Ventures Catalyst Fund, Y Combinator, Blue Haven Ventures, and Ventures Platform.

In August 2018, we raised an $8m series A, led by payments leader Stripe, as well as payments giant Visa. The round also included follow on investment from Tencent, Y Combinator, and a number of angel investors.

Paystack has raised a total of over $10m to date.

3. If you were given US$1m to invest in your company now, where would it go?

We’ve just completed a major $8m fundraise, and we’ll be investing that money heavily into building out our payment infrastructure further. Businesses in Africa have numerous needs when it comes to payments – from collecting localised payment methods in different countries, to managing chargebacks seamlessly – and we’ll be investing in systematically solving those issues.

We’ll also be expanding rapidly across the continent, providing businesses across Africa with access to simple but powerful payments tools to accelerate the growth of their businesses

Finally, we’ll be heavily recruiting exceptional talent.

4. What risks does your business face?

The most important constraining factor I see for our business is access to phenomenal talent. To succeed, we’ll need domain experts in numerous fields, and our growth will be a function of our ability to recruit and retain this talent.

5. Describe your most exciting entrepreneurial moment.

A recent highlight was receiving a call out of the blue that the vice president of Nigeria would be visiting our office. It was an opportunity to share both our own story but also the stories of all the incredible businesses whose growth is powered by Paystack, as well as the story of the broader Nigerian technology community.

6. Tell us about your biggest mistake, and what have you’ve learnt from it?

One of the big mistakes we made in the early days was assuming that everyone was like us. We’re a deeply technical company, and our early adopters were developers, so often we would unknowingly design for sophisticated users.

This was until we started seeing people, for example, put their date of birth as the card expiry date. We also realised that some people didn’t know what a CVV (the three numbers at the back of a credit card) was. These experiences made us realise we couldn’t assume anything about customers, and so we now always seek to simplify our solution and customer experience as much as possible.