Stitch acquired $21 million in Series A funding to develop its API and finance platforms
- ByStartupStory | February 15, 2022
As firms use APIs to access consumers’ bank accounts and deliver a variety of integrated and embedded financial services, open finance is a major subject in the fintech sector. Stitch, one of the leading companies developing and running these APIs in Africa, just disclosed to TechCrunch that it had secured $21 million in Series A investment.
This announcement comes after Stitch raised $4 million in a secret round in February 2021, which was a prelude to the $2 million extension round it received four months earlier, bringing its seed round to $6 million. Stitch has raised a total of $27 million so far.
The API fintech in South Africa allows organizations to create, develop, and grow financial solutions. With the additional capital, the firm wants to develop a “financial graph” ecosystem across Africa, according to a statement made by the company.
Stitch’s specializes in e-commerce, marketplaces, and platforms, as well as fintechs, which are its most important clients. As in previous years, African fintech outpaced other firms in terms of raising venture money, notably in 2021, when they raised 50-60% of overall VC financing, according to reports. Infrastructure players like Stitch, Mono, Okra, Plaid, and OnePipe — all of which raised money within the last year, some in seed and others in Series A — are critical to the continent’s collective growth of pushing financial inclusion and convenience of payments.
Stitch debuted its payments solution in South Africa in April 2021, and the next six months saw a 50 per cent increase in payments volume month over month. Stitch launched its payment service in Nigeria in October, with plans to process $10 million in monthly payments by the end of the year.
Pillay, who co-founded Stitch with Natalie Cuthbert and Priyen Pillay, didn’t provide an update on this measure during the call but did say that since introducing the product last April, Stitch has witnessed a 104 per cent month-over-month rise in payments value. In Q4 2021, the platform had a 44 per cent month-over-month rise in customers and a 72 per cent increase in connected bank accounts.
The Spruce House Partnership, a long-term investment business located in New York, led this round of fundraising. PayPal Ventures, TrueLayer, first-minute capital, The Raba Partnership, CRE Venture Capital, Village Global, as well as fintech founders and firms including TrueLayer, creators of Chipper Cash, Quovo, and Unit, and Guillaume Pousaz’s Zinal Growth, all participated in the round.
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