Wave, a U.S. and Senegal-based mobile money provider, has raised $200 million in Series A round of funding. The investment being the largest-ever Series A round for the West African region, and it values Wave at $1.7 billion.
Backed by Sequoia Heritage, a private investment fund and a subsidiary of Sequoia; Founders Fund; payments giant Stripe; and Ribbit Capital. Others in the round include existing investors Partech Africa and Sam Altman, the former CEO of Y Combinator and current CEO of OpenAI.
The mobile money market in sub-Saharan Africa is growing exponentially. This past year, up to $500 billion has moved through the accounts of 300 million active mobile money users in the region. But despite being one of the largest alternative financial infrastructures known globally, this represents only a fraction of the overall market.
The International Monetary Fund says that as of 2017, only 43% of adults in sub-Saharan Africa were “banked” by way of a traditional bank or mobile money account. When it comes to growing that proportion, however, mobile money — based on simpler technology and with an easier onboarding process — wins out, and it is set to capture more market share faster than traditional banking in the region. And this has investors, especially foreign ones, excited and looking to get on board.
The two-year-old startup claims to be the largest mobile money player in Senegal and that over half of the country’s adults are active users.
This sort of growth puts pressure on telecom operators. That has indeed been the case for the leading telecom operator in both regions, Orange. In June, the telecom operator stopped users in Senegal from purchasing Orange airtime via Wave’s mobile application.