Mar 7, 2022 - Economy

Scoop: South African fintech Yoco in talks to raise $150 million

Illustration of South African rand growing like leaves in a Baobab tree.

Illustration: Maura Losch/Axios

Yoco, a South Africa-based fintech helping small businesses take card and mobile payments, is in talks to raise about $150 million in funding, sources tell Axios.

Why it matters: Yoco's funding plans come amid a flurry of African mega-rounds as investors bet that the developing economy is ripe for growth across the fintech sector.

Context: Before 2021, just eight African startups had raised $100 million or more in a single round. Last year, that number shot up to 14, based on data from Partech.

Details: Yoco itself has been growing fast, doubling its revenue to $40-$50 million last year, per the sources.

  • Founded in 2013, Yoco — like the U.S.'s Block — manages payments and sells portable point-of-sale card machines as well as software for tracking sales, inventory, and staff.
  • Its rise comes as consumers in its largest market, South Africa, have increasingly adopted card payments over cash in recent years.

Zoom in: Yoco is now looking to be valued at between $700 million and $1 billion, though the sources caution that the fundraising numbers may shift as a lead investor has not yet been decided on.

  • The talks come eight months after the company raised $83 million Series C round of funding from investors including Dragoneer Investment Group, Partech, and Quona Capital.

Of note: Yoco declined to confirm the fundraise, though co-founder and CEO Katlego Maphai says the company is expanding rapidly in to other parts of Africa and the Middle East. It also plans to be IPO-ready by 2025.

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