South African payment startup, Yoco, has raised $83 million in Series C funding to scale up its platform and expand internationally.
The startup raised $16 million back in 2018 in a Series B funding round. This newly-secured funding has taken its total funds raised to $107million. This funding will help increase its market presence beyond South Africa and hasten the development of its financial ecosystem for small companies.
The funding doesn’t come as a surprise as Yoco is regarded as one of the most valuable startups on the African continent right now. This investment is the largest in South Africa and third only to Flutterwave and Chipper cash.
Yoco’s aim is to build tools and provide services to small businesses which are the backbone of most economies as they represent 90% of existing businesses globally and also create over 50% of employment.
The south African fintech launched in 2013 and has since been proactive in helping small businesses access loans, manage their day to day activities, and provide services that help SMEs accept card payments online or in-store. This made it the preferred payment partner for over 150,000 businesses and still adds over 500 merchants per day.
The funding round was backed by a new investor, Dragoneer Investment Group, which is making its debut into the Africa investment market. Breyer Capital, HOF Capital, The Raba Partnership, 4DX Ventures, TO Ventures, and other current and former executives from global digital companies like Coinbase, Revolut, Spotify, and Gojek also participated in the round.
Christian Jensen, co-head of private investments at Dragoneer, said in a statement how excited they are to partner with Yoco.
“At Dragoneer, we look for great teams that are building durable businesses with wonderful economic models, and that is exactly what we’ve found at Yoco. Yoco is already beloved by customers, and the product roadmap that the company is investing behind will drive even more value for merchants. While there is tremendous room for continued growth domestically, the opportunity for Yoco goes well beyond South Africa.”
Katlego Maphai, chief executive officer (CEO) of Yoco, also mentioned that the funding shows how large their potential is as he believes that Yoco has barely scratched the surface in South Africa but nonetheless still plans to expand into the larger African market as well as the Middle East.
Yoco expects to reach a million SMEs in the next four years, with over 100 million SMEs transacting in cash throughout both regions. To achieve these growth plans, it aims to increase its team by 200 people who will be working both remotely and across their offices in Cape Town and Amsterdam within the next year.
The startup is already on the move scouting and attracting some top talents to join its team. Some of them include Monzo’s former VP of product, Paypal’s former product marketing director, and Uber’s former head of communications Juan Fuentes. Also, the former managing director of fintech unicorn Pagseguro, has been appointed as the company’s new chairman.
Furthermore, Yoco’s small business-focused approach, combined with its depth of expertise and now the backing of some of the world’s most prominent investors make Maphai believe that the digital payments platform is on a springboard to considerable and long-term growth.
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