QED leads $11M investment in Nigerian fintech Raenest

As Africa’s tech ecosystem booms, extra folks from the area are touchdown distant jobs with large tech corporations and international startups. However getting paid stays a problem for a lot of of those freelancers and distant staff — they wrestle to open accounts that settle for U.S. {dollars}, face gradual invoicing and cost processes, and it doesn’t assist when their international employers use incompatible cost platforms.

Lagos-based Raenest is among the many African fintechs which have stepped in to handle this drawback. By its retail product, Geegpay, Raenest affords freelancers digital USD, GBP, and EUR accounts to obtain funds, handle multi-currency wallets and convert currencies. It additionally supplies digital and bodily debit playing cards that settle for a number of currencies like U.S. {dollars}.

Final March, the corporate expanded its platform to cater to companies to streamline worldwide remittance with a brand new model, Raenest for Enterprise. Now, the startup has raised $11 million in Sequence A funding, led by QED Traders, to develop its attain throughout Africa.

Progress past freelancers

Curiously, Raenest didn’t begin with freelancers in thoughts. Victor Alade, together with co-founders Sodruldeen Mustapha and Richard Oyome, launched the corporate in 2022 as an Employer of Document (EOR), serving to international firms pay African workers in compliance with native norms.

However a few months in, the founders realized the actual drawback didn’t lie with the businesses sending funds — it was with people struggling to obtain them.

“A U.S. firm won’t care if a cost is delayed by 5 days, however for somebody in Nigeria or Kenya, that’s an enormous deal — particularly when changing to native foreign money turns into one other hurdle,” Alade, a former software program engineer at Jumia and Andela, advised TechCrunch.

Drawing from his distant work expertise, Alade and his co-founders, who additionally convey expertise working with African fintechs like LemFi and FairMoney, pivoted to handle this ache level.

Geegpay shortly gained traction with freelancers, however enterprise signups started to rise as effectively. The staff realized that African firms additionally wanted international accounts to streamline cross-border transactions. “Companies began asking if they might get mounted financial institution accounts to simplify funds. That’s after we began pondering: How large is this chance? Who else is constructing for Africa?” Alade stated.

Raenest’s addition of enterprise banking couldn’t have come at a greater time. Round this time, U.S.-based fintech Mercury started restricting business accounts from a number of nations, together with elements of Africa. In the meantime, competitors within the EOR house was heating up, with main gamers like Deel starting to consider serving the continent extra carefully.

These occasions spurred Raenest to lean into what it noticed as a greater alternative: Providing African companies a method to obtain and ship worldwide funds.

A viable gambit

The wager appears to be paying off. Since launching in 2022, Raenest has processed over $1 billion in funds — a 160% enhance over the previous two years — to freelancers and companies throughout the continent. Right now, greater than 700,000 people use the platform to obtain funds from international platforms like Upwork, Fiverr and Gusto. Additionally they use it for on-line purchasing and subscriptions.

On the enterprise aspect, over 300 firms depend on Raenest to gather funds from worldwide clients, increase capital from traders, and make cross-border funds. Its shopper checklist consists of startups like Moniepoint, Helium Well being, Fez Supply, and Matta.

Raenest competes with a number of fintech startups providing multi-currency accounts to clients in Africa, together with Afriex, Cleva, Fincra, Grey, Verto and Leatherback. Alade argues that Raenest has an edge as a result of it targets people and companies, in contrast to most gamers that cater completely to a type of buyer personas.

The corporate’s ambitions lengthen past cross-border funds. “We wish to create a secure and seamless monetary ecosystem for Africans — serving to them earn, make investments and develop their wealth, regardless of the place they’re on this planet,” Alade stated, hinting at upcoming product launches.

Growth plans

At the moment, Raenest operates in Nigeria underneath a cash switch license. As a part of its development plans, the corporate will look to deepen its presence in Nigeria and safe licenses in Egypt, Ghana, Kenya and the U.S.

The corporate has banking partnerships within the U.S. and U.Ok., and it is usually working to safe extra in these areas because it scales. Alongside the best way, the corporate goals to draw expertise to help its enlargement because it brings Geegpay and Raenest for Enterprise underneath a single model, Raenest.

The Sequence A spherical brings Raenest’s complete funding to $14.3 million.

Lead investor QED, one of many world’s high fintech VC corporations, has been steadily rising its footprint in Africa since 2022. It has backed 5 fintech startups on the continent: Moniepoint, Remedial Health, Precium, Cedar Money, and now, Raenest.

“We firmly imagine that by bridging the hole between native and international markets, Raenest will unlock new alternatives for African entrepreneurs, freelancers and companies, in the end driving larger financial empowerment throughout the continent,” stated Gbenga Ajayi, accomplice and head of Africa and the Center East at QED Traders.

Different traders within the spherical included pan-African VC corporations Norrsken22, Ventures Platform, P1 Ventures and Seedstars.