Leading pan-African banking-as-a-service (BaaS) provider Anchor announces a $2.4 million seed round to launch new products, upgrade its infrastructure for licensing and compliance, and assess potential new markets.
Goat Capital served as the round’s lead investor, with participation from FoundersX, Rebel Fund, and other renowned investors like Y Combinator. The pre-seed round’s lead investor, Byld Ventures, also took part in the seed round.
Segun Adeyemi, CEO and co-founder of Anchor claims that the business has grown incredibly and increased its impact across various clients and customer segments in Africa.
“We are thrilled to have gathered such strong support from investors who share our vision of expanding access to financial choices through BaaS and embedded finance. This has been a significant journey for the Anchor team after our pre-seed raise last year. We have grown tremendously and increased our impact across various clients and customer segments in Africa.”
Anchor launched in August 2022, when it came out of stealth with a $1 million pre-seed and some early customers. Since joining the Y-combinator S22 batch, it has hit over $550 million in annualized total transaction volume (TTV), with revenue growing 30% month-on-month (MoM).
By cutting the development time for financial products from years to days, the firm streamlines the process for businesses. Anchor’s APIs allow its clients to create bank accounts, issue cards, send and receive payments without any issues, and provide savings and investment products through partnerships with licensed banking institutions. The business recently agreed to a relationship with MTN MoMo PSB, the largest telecom firm in Africa, whose fintech division is based in Nigeria.
“It’s no news that companies of all kinds are embedding financial products into their offerings, and we have seen this play out over the last few years in Africa. At Anchor, we are going beyond just offering these banking APIs to our customers. But also empowering them with insights into customer behaviours, preferences, and financial trends that will enable them to serve their customers better.”
Justin Kan, Partner at Goat Capital, speaking on the investment, said: “The embedded finance market in Africa is nascent but growing fast at over 30% CAGR. Anchor’s growth rate is impressive and shows signs of becoming the category leader, which is something we look out for in our portfolio companies. We are excited to partner with Segun and the team to leverage BaaS solutions to create financial prosperity for the continent”.
Adeyemi claims that the latest funding allows the startup to build out complementary parts of its core BaaS platform, strengthen its compliance infrastructure, and offer other value-added services.
