Rédaction Africa Links 24 with Grace Ashiru
Published on 2024-03-19 09:45:08
Zone, a Nigerian blockchain startup specializing in payment processing for banks and fintechs, has recently announced the successful close of its first venture capital funding round, securing $8.5 million in investment. This funding comes following its transition into an independent entity in 2022, having previously been a part of its parent company Appzone. The seed round was led by Flourish Ventures and TLcom Capital, with additional support from Digital Currency Group, Verod-Kepple Africa Ventures, and Alter Global, showcasing a mix of international blockchain-focused VC firms backing the company.
In a conversation with TechCabal, Obi Emetarom, CEO and co-founder of Zone, highlighted the importance of raising funds post-separation from the parent company to sustain and accelerate growth. Zone, Africa’s leading regulated blockchain network for payments, is now primed for expansion with the recent funding infusion. The company plans to enhance its domestic network coverage and establish partnerships with more banks and financial services providers. By operating a blockchain infrastructure that enables direct transactions between financial institutions without the need for intermediaries, Zone streamlines settlement, reconciliation, and dispute resolution processes, making it an integral part of processing payments across the continent.
With a client base of over 15 of Africa’s top banks and fintech firms, including major players like Access Bank Plc, Guaranty Trust Bank Plc, and United Bank of Africa, Zone’s network plays a crucial role in facilitating payments in the region. Ameya Upadhyay, Partner at Flourish Ventures, expressed confidence in Zone’s ability to drive payment innovation on a global scale, praising the company’s technology and envisioning its expansion beyond African borders.
Zone’s focus moving forward will be on enhancing its technology to enable instant settlements and expanding the utility of its blockchain network beyond ATMs to attract a wider user base. Emetarom emphasized that the company’s priority lies in developing APIs for seamless integration by banks, fintech firms, and other players in the financial services sector, rather than creating interfaces for end-users.
Despite the challenging funding landscape for African startups, with only $3.2 billion raised in 2023 according to TechCabal’s funding tracker, Zone managed to attract high-caliber investors due to the unique nature of its product and the extensive industry experience of its founders. Emetarom noted that while there are many customer-facing payment startups, Zone’s focus on building payment infrastructure sets it apart and makes it a truly unique player in the market.
Looking ahead, Zone plans to use a portion of the recent funding to conduct an extensive pilot program to assess the cross-border functionalities of its blockchain network in preparation for the launch of a remittance product in 2025. The company is prioritizing the enhancement of its domestic technological capabilities and the development of use cases before pursuing expansion into new markets.
