Nigerian fintech startup, Cleva, has secured $1.5 million in pre-seed funding to expand its platform, enabling Africans to open U.S. dollar accounts. The round was led by San Francisco-based early-stage venture capital firm, 1984 Ventures, The Raba Partnership, Byld Ventures, FirstCheck Africa, and several angel investors.
Cleva aims to facilitate international payments for African freelancers, remote workers, and businesses. Users can sign up for a dollar-denominated account using local IDs.
The Lagos-based company then allows withdrawing, sending, and exchanging dollars seamlessly. Cleva says it has already on-boarded thousands of customers and processed over $1 million monthly since launching in 2022.
“We believe our product provides a means to overcome challenges receiving international payments due to hyperinflation,” co-founder and CEO, Tolu Alabi, said.
Cleva is also part of the winter 2023 batch of Silicon Valley accelerator Y Combinator. The renowned program has backed other African fintechs in the same digital banking space.
To stand out in the competitive landscape, Cleva says it caps transaction fees at $20 unlike rivals charging unlimited rates. The founders’ experience building financial products for Stripe, Amazon and Twilio also fuels their ambition.
“This impressive early growth validates Cleva’s strong product-market fit,” lead investor Aaron Michael of 1984 Ventures, said.
Cleva now plans expansion across Africa and beyond, aiming to enable international payments globally.
Speaking in the business, CEO Tolu Alabi, said:
“The problem that we’re trying to solve, which is enabling people to receive international payments, is not a Nigerian problem nor an African one. It’s a global problem; people in Latin America, Asia, and even Canada need to receive dollars for their work and service. We’re starting with Nigeria because we know the market and it’s also a big market. But we feel like because of our backgrounds, we’re very well positioned to solve this problem at a global scale.”
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The startup also plans to offer dollar debit cards, savings features, and a payment API to third parties. These additions will further diversify revenue streams.
Africa’s tech ecosystem continues drawing investment, with Nigerian fintech and payment startups leading funding across the continent.
Cleva’s backers bet its embedded cross-border finance solutions can capitalize on Africa’s growth needs. And the founders say enhanced customer experience will keep differentiating their offering.
Across frontier markets worldwide, innovative models to access digital banking and foreign currencies present a $18 billion opportunity according to Cleva’s estimates.