Wave, a francophone fintech startup, recently found its way to be listed in Y Combinator’s top 50 companies that generated the highest revenue in 2022, alongside other companies like Coinbase and Zapier.Â
Y Combinator was established in 2005, and its main aim is to empower entrepreneurs and companies by providing seed funding, mentorship, and resources to startups. Since its establishment, they have helped several African companies that are now household names, like Flutterwave, Cowrywise, and Kobo360.
Fifty companies featured on the list of the highest revenue generated in 2022 have up to 70,000 employees, and 22% of these companies have offices located in the United States. They attained the remarkable success of having been funded with up to $40 billion and also having up to $50 billion in revenue.
How is it possible for Wave, a francophone fintech start-up, to attain such a feat?
About Wave
Wave operates as a mobile phone-based money transfer and payment service app that deviates from the traditional method of mobile banking and adopts an innovative approach.
This remarkable company was founded by two men, Durbin Drew, and Lincoln Quirk, in 2018 in Senegal. Within four years of operations, through a combination of innovative technology and extremely low transaction fees, it became the first Francophone African unicorn to cross the $1 billion mark. Surprisingly, more than half of the accounts opened are in Senegal.
Wave devised a process in which bills are settled without being subjected to additional charges. With this, people rushed to them because they knew that any transactions they did would not incur any expenses; they gathered lots of users and thus increased their revenue.
The problem of inclusive banking has been a significant challenge in Senegal. The majority of Senegalese lacked access to traditional banking services or had limited access to financial resources. This was caused by the following factors: limited physical bank branches in rural areas, high fees associated with traditional banking services, and a lack of familiarity with the formal financial system.
When their rivals were charging 6–10%, they became the first fintech start-up in Francophone Africa to lower their transaction price to 1%. This alarmed their rivals, who decreased their share to 1%, much like Wave, in an effort to stop Wave from luring away both their current and potential customers.
The launch of Wave was able to play a crucial role in addressing and promoting financial inclusion in Senegal.
Turning Point with Wave
As of 2016, Senegal had a population of 15.4 million, and more than half of the population lived below the poverty line. Getting high fees paid for every transaction would be tasking and frustrating for the people. Wave was the turning point for all of these. The fintech introduced a low rate for every transaction that is done online or offline. With this, the problem of financial inclusion was solved and a majority of the people in Senegal now have a bank account as a result of this.
Also, a large majority of the people living in Senegal don’t have an Identity card that they can use to open a bank account this was also a problem and because of this many persons were not involved in the banking system of the country. Wave came around and made banking easy and convenient for people with a phone you can own a bank account.
Even without a smartphone, banking was still made possible with the innovative technology of the complementary Q.R card which can be used for transactions whenever the need arose. This was the first of its kind and it is a different kind of innovation that has never been seen by any fintech startup.
In essence, Wave ruled both offline and online. They became one of the foremost Francophone startups in Africa to achieve this feat.
With these achievements they have gotten, they have moved on to other francophone countries like Ivory Coast, now they are currently in Mali and I see them going worldwide with this.
Despite the domination of several African fintechs, Wave still finds its way ahead. What are your views? Is Wave going to take over the African fintech Industry?
