Stitch, a South African API fintech company, announced today that it has closed a $21 million Series A funding round, led by The Spruce House Partnership.
The funding round also saw participation from 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 sets 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 in October.
Stitch offers data and payments solutions that reduce 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.
“We are incredibly fortunate to be supported by some of the best investors, founders, and builders in the fintech space globally,” said Stitch co-founder and CEO Kiaan Pillay. “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 Stitch would use APIs to “dramatically reduce the challenges that come with building across African geographies.’’ He also introduced what he refers to 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.
Today the company is walking the talk as it said the new investment 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.
Fintech is gradually becoming the largest sector in Africa, having brought the biggest cheque into the country last year and that before. So, it’s very important to build a connecting trail between these products, and that’s where fintech products like Mono, Okra, and Stitch has plugged themselves.
The company, in a 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,” said Ben Stein, co-founder of The Spruce House Partnership.
The company said the funding 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.
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.
“Stitch is building critical infrastructure to enable faster, easier, and more secure payments across Africa,” said Ashish Aggarwal, Director at PayPal Ventures. “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.”