In a significant development for the African fintech sector, Lipa Later, a leading fintech platform, launched a global crowdfunding campaign after securing regulatory greenlight in the USA. The company aims to raise $1.24 million in capital through Republic, a renowned global investor ecosystem at a $30m valuation cap. So far, the startup has raised $26,000 as per its Republic page. This move marks a significant milestone for Lipa Later, placing it among a select group of African startups that have successfully ventured into the realm of global crowdfunding.
Crowdfunding is a method of raising capital through the collective effort of friends, family, customers, and individual investors. This approach taps into the collective efforts of a large pool of individuals—primarily online via social media and crowdfunding platforms—and leverages their networks for greater reach and exposure.
Republic, the chosen platform for Lipa Later’s campaign, is a well-established global investor ecosystem that offers retail investors access to diverse investment opportunities. These opportunities span startups, cryptocurrencies, real estate, art, music, and more, often at the early stages of development.
The approval for public crowdfunding in the United States was a significant achievement for Lipa Later. It opens the doors to investors from across the globe, potentially accelerating the company’s expansion initiatives throughout Africa.
Founded in 2018 by Eric Muli and Michael Maina in Kenya, Lipa Later has carved a niche for itself in the fintech space. The company specializes in providing merchant solutions, including consumer credit, working capital, and e-commerce solutions. Its innovative Lipa Later Buy Now Pay Later (BNPL) product, which allows consumers to make purchases and pay for them in convenient instalments, has been widely recognized.
Lipa Later’s core mission is to empower African businesses by facilitating e-commerce, promoting financial inclusion, and offering a fully integrated and centralized shopping platform. Since its inception, the company has successfully secured $25 million in funding and operates in four key markets: Kenya, Uganda, Rwanda, and Nigeria.
The company’s recent achievement of raising $12 million in pre-Series A funding has significantly bolstered its expansion plans, allowing it to set its sights on a broader African presence. Lipa Later boasts an impressive customer base exceeding 350,000 individuals and collaborates with over 30,000 merchants. It has also forged an exclusive partnership with Mastercard for point-of-sale (POS) financing in East Africa.
Despite the global decline in funding, Lipa Later maintains profitability and has achieved a remarkable year-over-year growth rate of 558%. The company’s ambitious goal is to provide banking services to 100,000 SMEs (Small and Medium-sized Enterprises) across Africa and achieve a revenue milestone of $20 million by the end of 2024 as it positions itself to acquire a tier-two banking license in 2026.
Lipa Later’s endeavours not only signify a remarkable achievement for the fintech sector but also underline its commitment to driving economic growth and financial inclusion on the African continent. The company follows in the footsteps of startups like Asaak and Eversend, which have successfully raised funding via crowdfunding campaigns in the past. Asaak, which expanded to Latin America this month by acquiring a Mexican startup, raised almost $1.2m in January 2023 across two campaigns from over 2,500 investors. Eversend, the cross-border money transfer fintech, raised $706,000 in May 2020 in crowdfunding and followed it up with another crowdfunding round in July 2020 raising $313,000.