Afriex a Nigerian Based Blockchain FinTech Raises $10 million

Tope Alabi knew he wanted to launch a firm using what he learned working at blockchain consultant Consensys when he returned to Nigeria in 2019 after spending 20 years in the United States.

He and future partner John Obirije began testing a variety of concepts, including a hip hop chatbot and a quiz game, both of which were unsuccessful.

However, they noticed that they were running into the same problem throughout the trial and error: trying to pay business expenses for the numerous start-ups using money held in U.S. bank accounts. They decided to develop a blockchain-based money transfer system that allows users to move money by converting it to stablecoins, which are cryptocurrencies backed by reserve assets.

This approach makes the transaction free and faster than Wise, which has a 6.45 percent fee and can take a few days to process. The service, Afriex, was introduced in 2019 and quickly gained traction. From then, things really took off, 

“I’m not sure if it was the pandemic, but we started growing incredibly fast.” Initially focused
on Nigeria, the program has subsequently expanded to Uganda, Kenya, and Ghana.” Said Alabi

This approach makes the transaction free and faster than Wise, which has a 6.45 percent fee and can take a few days to process. The service, Afriex, was introduced in 2019 and quickly gained traction.

Afriex is part of a wave of fintech startups in Africa that are focusing on underprivileged and frequently forgotten customers. According to CB Insights, over $1.4 billion was invested in African fintech businesses in 2021, about seven times more than in 2020.

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For instance, Wise moves an average of £4 billion ($5.2 billion) per month, but Afriex’s customer base has increased by 500 percent in the last six months, with half of its active users using the site more than once a week. When a customer transacts, the startup makes money by arbitraging currency and crypto exchange rates. Afriex refused to reveal its earnings.

It received $1.3 million in a seed round in May and just concluded a $10 million Series A investment at a valuation of $60 million. Sequoia Capital China and Dragonfly Capital led the round, which also included Goldentree, Stellar Foundation, and Exceptional Capital, as well as others

While speaking, Dragonfly Capital managing partner Haseeb Qureshi met Alabi while serving as a mentor at A16z’s crypto startup school. His group included Alabi. He claims he was blown away by Alabi and Afriex, but he passed on the seed round because he wasn’t sure how the company would scale after witnessing so many startups attempt and fail to develop crypto businesses in Africa.

He assumed Afriex had broken the code after observing the company’s traction. “One of the company’s biggest assets is its ability to span the entire corridor between the United States and Africa, where many others have tried and failed,” he added “The reality is that you need a very strong ground game to succeed in emerging markets.”

As Afriex is concentrating on its main money transfer product, Alabi has big plans for the platform He intends to utilize it to develop a stablecoin, and has already signed a deal with Visa to provide Afriex users with credit and debit cards later this year.

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Tope Alabi expects that Afriex would be able to provide Africans with a safe haven for
their money that isn’t affected by external factors as much as existing currencies are.
Alabi’s uncle in Nigeria, for example, claims that currency swings cause him to lose up to ten percent of each paycheck.

“We’ve constructed on-ramps for local Nigerian banks and on-ramps for local currency
exchanges because we’re developing this network of connected financial institutions,” he added