- Flutterwave Inc. bought Mono Technologies Nigeria Ltd. to boost earnings and strengthen its case for a potential initial public offering.
- The purchase will lower costs and expand Flutterwave’s profit margin on account-to-account payments to at least 10%, according to its chief executive Olugbenga Agboola.
- Flutterwave is counting on Mono’s technology to harness broader payment opportunities expected from the recapitalization of Nigeria’s banking industry.
Flutterwave Inc. is betting its purchase of open-banking platform Mono Technologies Nigeria Ltd. will boost earnings and strengthen the case for a potential initial public offering by Africa’s most valuable financial-technology unicorn, its chief executive said.
The Lagos- and San Francisco-based payments company this week bought the startup that it’s worked with since 2021 to leverage its infrastructure, secure access to financial data and enhance identity verification. It didn’t disclose the cost or terms.
“Right now, our focus is profitability, resilience and better infrastructure, and that is why we acquired Mono,” Olugbenga Agboola said in an interview. “It makes us a better candidate for everything,” including the planned IPO, he said.
Since its founding in 2016, Flutterwave has expanded to about 35 African countries, accepts payments in more than 30 currencies and processes about 500,000 payments daily, according to its website. It has also held various funding rounds, with one in January 2022 that tripled the company’s valuation to $3 billion.
Africa’s largest payments startup first announced plans for an offering on New York’s Nasdaq stock exchange in 2022 but delayed them to address issues including high-level staff departures, allegations of financial impropriety and personnel harassment in some of its offices.
It later halted the plan entirely, citing the need to first build profitable and sustainable business. The company also denied the accusations of financial misconduct.
Flutterwave previously paid Mono per transaction for account-to-account payments on its platform. The purchase will lower costs, expanding its profit margin on these particular processes to at least 10%, Agboola said.
Mono emerged as a significant player in Nigeria’s fintech industry, enabling businesses to securely access customer financial data for better credit decisions, as well as faster onboarding, fraud reduction, and seamless payments.
Flutterwave is counting on Mono’s technology to harness broader payment opportunities expected from the recapitalization of Nigeria’s banking industry, which is expected to accelerate lending, trade and e-commerce, Agboola said.
“We are the rail that carries the flow of transactions across the country and across Africa, and part of what we have done by acquiring Mono is to deepen that rail,” he said.“If an IPO knocks, that makes it even easier,” he added, declining to provide a timeline for the move.
