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FMO will co-invest USD 1.7 Million alongside Accion Frontier Inclusion Fund, managed by Quona Capital, in South African-based Point of Sale payments Provider Yoco in a joint funding round totaling USD 16 Million. It marks the first direct equity investment in a fintech by FMO.
Yoco will leverage this Series B funding, led by Partech, a Venture Capital Firm based in Silicon Valley, Europe and Africa, to grow its network of small business merchants, invest in product development, and to attract top-tier fintech talent.
Yoco builds tools and services to help small businesses accept card payments and manage their day to day activities. Since launching its first product in late 2015, a card reader that connects with a merchant’s smartphone or tablet, the company has grown its base to over 27,000 South African small businesses, 75% of which had never accepted cards previously.
Founded by associates Katlego Maphai (CEO), Carl Wazen (Chief Business Officer), Bradley Wattrus (CFO) and Lungisa Matshoba (CTO), the fintech company was built to address the pain points that small businesses face when trying to get a card machine. Less than 10% of South African SME’s accept card payments, despite South Africa having a card penetration of 75%, with debit cards being the dominant wallet in the country.
Ronald Janse, Manager Private Equity at FMO, said: “FMO supports the massive opportunity in the African fintech space to improve the quality of financial services through creation of a digital footprint for SME’s. This creates greater transparency and enables SME’s to access value added services like working capital. Through their proprietary payment solution, Yoco enables over 27,000 small and medium sized enterprises in South Africa to get access to a portable, and convenient payment solution where it has become the market leader.”
Katlego Maphai, Yoco Co-founder and CEO, said: “Small businesses, fundamental to sustainable economic growth, are generally underserved in our part of the world due to their size. Running a business is hard enough, we believe accepting money shouldn't be. We built Yoco on the key pillars of access and trust. Transforming the long and prohibitive process of applying for a card machine into a simple consumer-like product purchase that can happen online or at the store in minutes. Our Series B investment allows us to continue to scale our operations and deliver a world-class product experience that enables small businesses to thrive.”
The Series B round of US$16M is led by Partech and with participation from Orange Digital Ventures, FMO and existing Series A investors Quona Capital and Velocity Capital. It brings the company’s total investment to US$23M.
Yoco (www.yoco.com) is committed to empowering the growth of entrepreneurs in South Africa through smart technology. Yoco launched its first product in late 2015, a mobile card reader that connects to a merchant’s smartphone or tablet. Today, over 27,000 South African small businesses use Yoco’s card readers and point of sale software to get paid and manage their businesses.