Ashley Brindamour AVG Blog April 1, 2021

Paystack: A Case Study in Emerging Markets Dynamics

Investing in Promising Ventures Beyond Silicon Valley and Across the World

Paystack: A Case Study in Emerging Markets Dynamics

April 1, 2021 | Ashley Brindamour

Alumni Ventures’ new Emerging Markets Fund (EMF) posits that there’s tremendous opportunity outside of Silicon Valley and across the world. Our new fund invites investors to own ~20-30 venture deals in diversified companies from U.S. and international emerging markets.

To bring to life the vibrancy of emerging markets, today we’re focusing on the story of one successful Nigerian fintech: Paystack. Note that this is not an AVG investment, but it typifies the types of companies we will consider for the EMF portfolio. Paystack provides a fast way to integrate payments services into either online or offline transactions through its API. They give businesses the ability to accept payments through credit card, debit card, money transform, and mobile money.


Fund Now Open

The Emerging Markets Fund will offer investors a way to further diversify their portfolio: through geography. The fund will invest in ~20-30 companies headquartered outside of the major U.S. venture capital hubs — Silicon Valley, NYC, Boston — or are based/largely doing business internationally. To learn more, click below to review fund materials or book a call with a Senior Partner.

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Explosively Growing Ecosystem

To set the story of the company’s rise, let’s first explore the ecosystem.

  • Africa is a standout in the emerging world, with seven out of 10 of the fastest-growing economies on the continent.
  • Further, Nigeria is the most active venture investing market in Africa. In fact, Nigeria’s 2019 share of the African VC markets was ~50%.
  • Zeroing in on Paystack’s mobile payments sector, online commerce in the region is increasing 21% year over year. That’s at a 75% faster pace than the worldwide average.


Paystack’s 5-Year Road to Success

Paystack got its start in 2015 when CEO & Co-Founder Shola Akinlade built a sway to integrate a card transaction into a web page — and from there, started to imagine how it could work for others. In 2016, that idea took him and his company to Y Combinator, the first Nigerian startup to enroll. A seed round followed that year, and then an $8M Series A in 2018. Stripe led the round, with other investors including Y Combinator and Visa.


The Paystack Team. Photo Credit: Paystack


Then in 2020, Paystack was acquired by Stripe for reportedly $200M — a record for a Nigerian startup. It was also a natural fit for Paystack, which has earned the moniker of “the Stripe of Africa.” Paystack will keep operating independently, though longer-term, their capabilities will likely be folded into Stripe’s global platform.

As Stripe’s Co-Founder and CEO Patrick Collison frames it, this is an investment in not only current success but an even bigger future: “In absolute numbers, Africa may be smaller right now than other regions, but online commerce will grow about 30% every year. And even with wider global declines, online shoppers are growing twice as fast.”


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While the first 50 years of venture investing were confined to a few U.S. hubs, we believe that the next 50 will be different. Alumni Ventures’ Emerging Markets Fund will offer investors a way to further diversify their venture portfolio: by investing in emerging markets in the U.S. and around the globe. Join us on Wednesday, April 7, at 3:00 PM ET to learn more about our newest fund during a 45-minute live session, led by CEO Mike Collins and CIO Anton Simunovic. 

Register Here  »


The Ecosystem Impact

The Paystack example is inspiring not only as the account of one company’s rise, but for its ecosystem ripple effectsA few quotes illustrate the impact. Katlego Maphai, CEO of Yoco in Cape Town, a digital payments company for small businesses, observes, “For many people, it was seen as a validation of the ecosystem and a recognition from Silicon Valley tech that there’s actually a lot of potential in Africa.”

Maya Horgan Famodu, Managing Director at VC fund Ingressive Capital, who backs African startups and was an early investor in Paystack, says, “Since the acquisition happened, not only are we having an increase in foreign investors approach, but we’re also seeing African institutional funds.” She also notes that there’s been a yearly 2X increase in VC dollars in Nigeria since 2016. And after Paystack became Nigeria’s first Y Combinator graduate, ~40 other African startups have been admitted.

Given that kind of increasing VC commitment and growing entrepreneurial excitement, there’s good potential for more Paystacks in Africa’s vital emerging market — and for forward-leaning venture investors.


Alumni Ventures’ Emerging Markets Fund offers a portfolio of ~20-30 promising, venture-backed companies from emerging markets in the U.S. and internationally. It’s a chance to further diversify your portfolio, seeking opportunities in rapidly growing regions where there are outsized opportunities.

Interested in learning more? Click below to review fund materials.

View Fund Materials

Contact for additional information. To see additional risk factors and investment considerations, visit


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