The transaction is being finalized while actively meeting regulatory requirements. This acquisition is a strategic move that will enable Smile Identity to expand its presence in Africa and strengthen its position as the foremost digital KYC and identity verification provider on the continent. Reports revealed that the deal was worth around $20 million, with a significant portion being paid in stock.

Born from Mark Straub’s experience, who co-founded Smile Identity with William Bares in 2017, while travelling to India, during which he noticed how difficult it was to prove his identity, and the same problem arose while he was travelling across Africa. He realized that India was still in the early stages of implementing Aadhar, and this prompted him to create Smile Identity, a solution that would help Africans prove their identities easily anywhere in the world.

Today, Smile Identity is developing advanced tools and software that will revolutionize the way millions of Africans authenticate their identities online. The company’s innovative AI and identity verification tools are tailored to suit African facial features and boast an accuracy rate of 99.8 percent.

Its technology has been adopted by rapidly growing companies across a diverse range of industries in Africa, including Chipper Cash, Paga, Paystack, Twiga, Opay, and many others.

Investors backing the startup include Costanoa Ventures, Future Africa and Norrsken22, among others. 

Appruve on the other hand offers an API for verifying user identity and detecting fraud. The startup places significant emphasis on new datasets that either complement or supplement traditional government data, such as national IDs and international passports. 

Over the past 18 months, the company has focused on analyzing fraud data from global money networks, verifying mobile money financial statements, and acquiring blocklist data from various banks and fintechs. Despite receiving less than $500,000 in venture capital funding since its inception, as well as $450,000 in grant money from DFS Lab, the Bill & Melinda Gates Foundation, and Google’s launchpad studio accelerator, Appruve has managed to establish itself as a four-year-old digital verification upstart.

Smile Identity’s acquisition of Appruve will enable the company to broaden its suite of APIs, which includes mobile money, data, and anti-fraud checks. With this development, Smile Identity affirms that it can now cater to over 1 billion Africans, the African diaspora, and 100 million African businesses. It can support more than 230 types of documents and data, and can integrate with any device and operating system combination in Africa. Before the acquisition, Smile Identity had completed over 60 million verifications.

In partnership with Paystack, Smile Identity and Disrupt Africa, Stitch will enable these businesses to gain access to capital, advice, and product support, ultimately helping them build and scale their dream solutions.

Having recently raised $4,000,000 in seed funding and an extra $2,000,000 seed extension in 2021, Stitch was founded by Kiaan Pillay, Priyen Pillay and Natalie Cuthbert with a goal to offer API access to bank accounts in Africa with a lightweight single Sign-On experience. Essentially, the startup provides a service that enables its clients to connect their apps to users’ financial accounts, reducing the technical and operational effort.

Benefits

Companies accepted into the programme will receive:

• Pitch support from members of the Stitch team

• Office hours with members of the Stitch team

• A 1-hour workshop with members of the Paystack team focused on fundraising and growth

• Free payment processing from Paystack for selected startups operating in Nigeria, South Africa, and Ghana

• Six months of free access to the Stitch API for selected startups operating in Nigeria and South Africa

• Six months of free access to Smile Identity

Note: ALL applicants operating in SA and NG receive 2 months of free access to the Stitch API and Smile Identity

Eligibility

Businesses interested in participating

• Must be headquartered in South Africa, Nigeria, Kenya, Egypt, Ghana, Uganda, Zambia, Tanzania or Rwanda

• Must be at the pre-Series A stage

• Must have a fintech or embedded finance solution

How to apply

Is your business scalable and innovative? Apply to participate in the Stitch Startup Showcase before the deadline on Thursday, February 10, 11:59 pm SAST.