The great Cape Town drought of the decade may largely be a thing of the past, but it’s not something that should be forgotten…
Lagos-based fintech TeamApt is working on scaling to Latin America by the third quarter of this year, founder and CEO Tosin Eniolorunda has revealed to Ventureburn.
Last month TeamApt — which develops digital banking and payments infrastructure solutions for banks and was founded by Eniolorunda (pictured above) in 2015 — raised $5.5-million in a Series-A round led by Nigerian private equity firm Quantum Capital Partners.
In a statement last month announcing the investment, TeamApt said it would deploy the funding into further product development, talent acquisition and expansion of its internal operations.
The startup last month also told US tech news site Techcrunch (see this article), that it will use the funding to expand its white label digital finance products and pivot to consumer finance with the launch of its AptPay banking app.
TeamApt has worked with 26 African banks, including all the commercial banks in Nigeria
Eniolorunda told Ventureburn last week that TeamApt — which he said has started expanding to Ghana, Kenya, Liberia and South Africa — is looking to enter Senegal, Cameroon and Ethiopia by the second quarter of this year.
TeamApt, he revealed, also has plans to enter a “Latin American country” by the third quarter, with plans to scale to Canada and the US by the first quarter of 2020. He did not disclose which Latin American country this is.
Bootstrapped from inception
Commenting on how the deal with Quantum Capital Partners — TeamApt’s first VC investor — came about, Eniolorunda said the startup’s pitch deck reached the private equity firm and they were “intrigued” by the scale TeamApt has achieved with “little external help”.
“We were also at a stage that we needed strategic funding partners and they fit the profile we needed,” he explained.
Up to that point TeamApt was bootstrapped — starting off with startup capital of 15 million naira ($42 000) — and earning its first revenue from payment projects.
“We were fortunately selected for some important enterprise project for some banks and payment firms. Our clients paid us upfront and this provided the bootstrapping capital,” explained Eniolorunda.
He further explained that in its early days he decided that his startup would not take external funding, as at the time the company remainder liquid enough from the upfront payments it was receiving from clients.
“We were also growing more than 100% year-on-year at that rate. It was also difficult to go through the prospecting process for investors. It takes a lot of resources which I did not have, being a single founder,” he said.
About maintaining identity
Eniolorunda believes he’s always been an engineer and entrepreneur. He told Ventureburn his earliest foray into tech entrepreneurship was when he was in junior secondary school where he repaired electronics.
At some point, he became his family’s breadwinner when they hit financial problems owing to his father’s ailing health. “I had always loved hardware and computers. I moved on from repairing things to building things at my senior secondary school and I remember building a digital display board as a parting gift for the school,” he said.
Later on, while in university, Eniolorunda would build and sell software and hardware projects to other final year students, and even companies. “All these grew the entrepreneurship drive. I, however, knew I had to learn the industry first to succeed,” he said.
In 2009, Eniolorunda joined Lagos-based payment processing firm Interswitch as a software engineer, rising to become a product manager in 2014.
He believes that many entrepreneurs are often “driven to create”, and then “get rich” doing so. However, he adds, they are often content if they can successfully create, even when “the money part is not exactly proportional”.
“I hence left the company when it was becoming harder to create and had to take the leap to start TeamApt to maintain my identity,” he said.
The idea behind the startup came while he was at Interswitch, where he designed and built a “virtual machine” for point of sales (POS).
“Gaining knowledge with projects such as this, enabled me to chart a direction towards my personal goal of creating value to financial prosperity,” said Eniolorunda.
‘Talent acquisition biggest challenge’
Fast forward to the present day, where TeamApt has developed 55 tailored solutions and has worked with 26 African banks — including all of Nigeria’s commercial banks. TeamApt also claims to have on-boarded 100 000 Nigerian businesses serving three million customers, and is currently processing monthly transactions of about $160-million.
In addition, the startup — which employs a team of more than 40 developers — claims to have recorded revenue growth of 4500% over a three-year period between 2015 to 2018. However, as is the case with all ventures, TeamApt hasn’t been without its problems.
Eniolorunda pointed out that talent acquisition is one of the biggest challenges TeamApt has had to face and still faces. He largely attributes this to Nigeria’s economic problems — specifically a devalued Naira — which he says have made local talent “more attractive” to global markets. This he said has increased emigration and remote work opportunities for “quality” software engineers.
“Of course the increased demand also increased the cost of these talents which in turn can affect margins,” he said. One of TeamApt’s lowest point, he explained, was when the startup lost a “key talented” engineer to Microsoft.
“We were at the depth of an important deployment for a key customer with stiff schedules and the engineer was poached with a H1B offer (the US visa for specialty workers – Ed). This delayed the project and the customer was not pleased at all. We almost lost the deal,” said Eniolorunda.
‘Easier, faster, cheaper’
So, what sets TeamApt’s solutions apart from its competition?
Eniolorunda believes key is that his startup’s solutions have more depth and capture customer needs “more succinctly” than his competition.
“We follow the easier, faster, cheaper mantra. This often makes many customers select us even when we were the underdogs,” he said.
‘Future is more digital’
For Eniolorunda, the future of African banking is digital. He believes physical branches will disappear more as products are delivered through mobile and online channels.
“Customers will accept these channels more and will forget that it was once needed to go to a physical location,” he said. He added that local African banking also has “the biggest future opportunities” in the inclusion of more Africans.
Says Eniolorunda: “Banks that find scalable and innovative business models to serve the currently underserved population more profitably will diversify their portfolio and unlock new revenue streams”.
Featured image: TeamApt founder and CEO Tosin Eniolorunda (Supplied)