South African API fintech startup, Stitch has announced today that it has raised the sum of $21 million in Series A funding round. The round was led by The Spruce House Partnership. Also participating in the funding round were PayPal Ventures, TrueLayer, Firstminute Capital, The Raba Partnership, CRE Venture Capital, Village Global, Zinal Growth (the investment vehicle of Checkout.com founder Guillaume Pousaz) and others, including founders of Chipper Cash, Quovo, and Unit.
This new funding raised has set the company’s total funding at $27 million after it launched out of stealth mode in February 2021 with $4 million seed and the $2 million extensions round that followed up in October.
Stitch said that the funds raise will also be going into significantly expanding the team, launching new product offerings, and entering new markets across the continent. It’s already operating in 2 out of Africa’s 4 largest fintech markets—South Africa and Nigeria.
The company offers data and payments solutions that reduces the effort required for businesses to connect to their users’ financial accounts and enable bank-to-bank payments without leaving the existing app interface.
Their infrastructure-led approach supports several use cases, including KYC and onboarding, personal and business financial management, lending, wallet top-ups, e-commerce checkouts, and more.
Stitch co-founder and CEO Kiaan Pillay said, “We are incredibly fortunate to be supported by some of the best investors, founders, and builders in the fintech space globally”.
He added, “They are working closely with us to enable the boom we’re seeing in financial technology on the continent. Across the hundreds of customers we work with, big and small, we’re witnessing a record pace of development of new financial products.”
In October 2021, while announcing their expansion into Nigeria, Pillay said that the goal of Stitch is to become the go-to partner for any business’ building financial products in Africa.
Pillay also introduced what he best describes as “financial graphs” – an infrastructure for financial building blocks that can interoperate across regions, providers, banks, and other types of financial accounts, allowing businesses to write code once, launch in multiple markets, and scale more quickly.
Currently, the company is achieving its laid goals following the new funds raised as it will go into creating the financial graph, while continuing to build the future of money movement by linking bank accounts, wallets, and other stores of value across Africa.
As fintech is gradually becoming the largest sector in Africa, it is quite important to build a connecting trail for payment powerhouses, and that’s where fintech companies like Mono, Okra, and Stitch has plugged themselves.
The company, via its statement, listed fast-growing businesses from wallet-based companies like Chipper Cash, Luno and Zapper, to financial services providers like ImaliPay, to subscription and e-commerce players like FlexClub, to PSPs and payment aggregators like Peach and Yoco as its partners.
“We have been following startups in Africa for many years. Our diligence was very clear that this is one of the most talented teams on the continent, and we are excited to be a part of what they are building at Stitch”,Ben Stein, co-founder of The Spruce House Partnership said.
In the last quarter alone, the company said that it saw 44% month-on-month (MoM) customer growth and a 72% MoM increase in linked financial accounts on the platform. It’s had 104% MoM growth in payments value since launch.
Ashish Aggarwal, Director at PayPal Ventures said, “Stitch is building critical infrastructure to enable faster, easier, and more secure payments across Africa”.
“We believe they will play a significant role in contributing to the overall growth of the fintech space in Africa, and we are excited to be investing at this important moment in their journey”, Aggarwal added.