Yoco raises Series B funding worth $16 million

Yoco raises Series B funding worth $16 million

Yoco, the South African-based Point of Sale payments provider has raised a Series B round of US$16M led by Partech, a Venture Capital firm based in Silicon Valley, Europe and Africa, with participation from Orange Digital Ventures, FMO (The Dutch Development Bank) and existing Series A investors Quona Capital and Velocity Capital.

The company has a presence in Kenya as well and sits in Nairobi Garage’s Kilimani Office Space. In a press statement Yoco said that they will leverage its Series B to grow its network of small business merchants, invest in product development, operational scalability and attracting top-tier fintech talent.

This new investment brings the company’s total investment to US$23M. The company also announced the appointment of Cyril Collon, as the new General Partner at Partech and Co-lead of the Partech Africa Fund who will alsp join Yoco’s Board.

Yoco is a company that 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.

The company is adding more than 1,500 new merchants every month, making it South Africa’s largest and fastest growing independent card payments provider by number of merchants, more than tripling in size since raising its Series A in early 2017.

Founded by 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.

Only 7% of South African small businesses accept card payments, despite South Africa having a card penetration of 75%, with debit cards being the dominant wallet in the country. There are over 1 million small businesses in South Africa ripe for card acceptance.

Yoco is closing this acceptance gap by making card payments more accessible through its trusted and secure platform. It lowered the cost of ownership of a card machine by a factor of seven by removing monthly fees and lock-in contracts. Signing up online takes 10 minutes and over 98% of businesses who apply get approved, thanks to its proprietary fraud management system.

Yoco’s strategy is to partner with small businesses early in their life cycle and actively help them grow. It has been adding services to its payments solution, which now includes point of sale software, business intelligence, accounting integrations, and working capital financing, in its bid to create an operating system for the small business.

Yoco has long-term ambitions to be a pan-African player. The company believes the convergence of digital payments and software driven value-added services is inevitable in Africa. It has explored various Sub-Saharan markets in the past year, including running pilots in two markets.

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