Flutterwave’s CEO on executive hires, the company’s product focus and IPO plans
Popat was appointed after the resignation of Oneal Bhambani, who resigned ten months ago for personal reasons. The company, valued at $3 billion when it raised a Series D in 2022, appointed Popat after the resignation of Oneal Bhambani, who stepped down ten months ago for personal reasons.
Bhambani joined Flutterwave in mid-2022, during a turbulent time when the fintech faced allegations of employee mistreatment and financial misconduct. He played a major role in stabilizing the operations of Flutterwave during his 18-month tenure. Flutterwave was able to resolve a money laundering case in Kenya where the authorities had frozen more than $50 million. He also led the fintech to Rwanda as a licensed money transfer provider, and he initiated its application for a Kenyan license. Under his watch, Flutterwave laid plans to invest $50 million to strengthen its presence in Kenya, South Africa, Nigeria, Rwanda, Tanzania, and Cameroon.
Surely, Flutterwave’s expansion plans and next growth phase will partly be Popat’s responsibility. Again, while Bhambani’s departure and the exits of other ex-Kabbage executives reignited concerns about Flutterwave’s leadership and IPO plans, Popat’s arrival, along with the hiring of six additional executives in finance, risk, legal, and compliance, could help put those concerns to rest and turn the company’s narrative around.
“Mitesh brings the right balance of global and emerging markets experience as we optimize for sustainable growth,” said CEO Olugbenga Agboola to TechCrunch. “Our recently acquired licenses in Malawi, Uganda, Ghana, and Mozambique, as well as our expansion to 49 states in the U.S., will further extend our solutions of bridging the gap between Africa and the global economy.”
Meanwhile, Flutterwave recently undertook its first major restructuring since its founding in 2016, when it laid off 3% of its workforce in June. Barter, a consumer finance app that allowed users to pay bills and send money, was also closed. The reason for this is to focus on the core products of Flutterwave: enterprise solutions, and remittances. The flagship enterprise product Flutterwave for Business (FFB), used by banks, startups and companies such as e-commerce, FMCG, transportation and telecommunications to accept payments generates 90% the fintech’s revenues. He expressed a clear ambition for Flutterwave: “We want to be that infrastructure layer that powers all the who’s who of payments on the continent; I would say we want to be the Adyen of Africa.” Agboola expressed a strong ambition for Flutterwave, “We want to become the infrastructure layer for all of the major players in payments on the continent. I would say that we want to become the Adyen for Africa.” You said Flutterwave wants to be the Ayden of Africa. I agree. Adyen has a global reach of over 100 countries, while Flutterwave only covers 30 African countries. Flutterwave, unlike Ayden still relies on partnerships banking licenses. Flutterwave has recently acquired licenses for certain markets. Does this mean that Flutterwave is looking to change the current model? Once you have aligned yourself with the banks, you can start your fintech in partnership. The banks will provide all the infrastructure that you need to get started. To go deeper, you must eliminate as many layers of third parties as possible. You also need to be the owner of the infrastructure. You can then offer your customers more. We cannot afford to have third-party systems down, so we must hold onto our licenses. It depends on the market. It depends on the market. Some markets are more important to our customers than others. But our goal is that any market where our top customers think about us is one we want to be in. We must hold our license there. It’s a play at providing better customer experience and being that reliable payment infrastructure is so crucial for us, and that’s how we want to scale that business.
What would you say are key markets for Flutterwave right now?
Our core key markets in Africa are Egypt, Morocco in North Africa; Nigeria and Ghana in West Africa; Rwanda, Tanzania, Uganda, and Kenya in the East Africa corridor. You can also look at Central Africa which includes Cameroon and Senegal. Cote d’Ivoire, DR Congo, and Tanzania are all part of this region.
I am aware that these markets are important for Flutterwave’s enterprise business, and to a certain extent, its remittance products. You reduced your staff by 3% in June to focus on these two segments, and you deprioritized Barter because it was popular among consumers. Can you explain the reasoning behind that decision?
Barter was sunsetted because our focus shifted toward where the majority of our customers were. We are very good at following our customers’ journeys, and we value the voices of our customers, mainly businesses. They said, “Look, We want to Make More Enterprise Payments.” Retail consumers were more concerned with sending money to Nigeria from another country, Ghana, Uganda or Rwanda, and receiving money from US. What about Flutterwave’s agency banking, where it provides POS terminals to businesses for offline payments? Does that business still exist? Flutterwave is an omnichannel company. We provide our services to customers in the way they prefer. Some businesses in Lagos, Nigeria use our POS devices. Both online and in store, we serve our customers. We are focused on the customer experience, which is why our POS devices are only used by high-value retailers. You won’t find us in every store. It’s part of our strategy to serve businesses digitally first, and then in-store when necessary.
How many merchants are using Flutterwave omnichannel payment gateways?
We’ve got over 1 million businesses signed up on our platform today.
I understand Flutterwave’s revenue split between enterprise and remittance is currently 9 to 1. Given the exponential growth of remittances to Africa, which reached $100 billion in 2022, do you anticipate this split will change significantly in the coming years?
Interestingly, I was looking at Square numbers recently, and Cash App is now bigger than Square business by revenue, which says a lot. But I don’t think that will happen here as our business will continue to grow. This is where we are betting, and I do not see it changing. We will also continue to grow in remittance. Last December we received 13 money-transmission licenses, and now they have been doubled. We can cover the whole of the U.S. using our remittance service. However, we’re yet to scratch the surface when it comes to payment and enterprise infrastructure in Africa.
Is Flutterwave currently working on new products outside enterprise and remittance?
Most of the category leaders on the continent are our customers. We are investing and building in the sectors that our customers operate in, such as hospitality, entertainment, travel and transport, and TMT. We invest in R&D, and build features that help our customers grow, because their growth is also ours. The fintech’s recent hiring has been strategic, if you look at the big picture. In the last year, the majority of your executives came from Stripe Cash App PayPal Western Union and Western Union. Mitesh popat, from Citi, is the latest addition. This lineup could be argued to be a good one to bring Flutterwave to the public market soon. We don’t have a priority to raise more capital. We want to go deeper than wider as we double down on our key business segments of enterprise payments and remittances. We want to go deeper than wider as we double down on our key business segments of enterprise payments and remittances.
We want to be better in every segment for our customers because we want them to keep scaling with our platform; these are my current corporate priorities, including scaling risk management and investing in high-performing talent. Flutterwave’s news coverage has not been limited to this. According to local reports, fintech is attempting to recover millions of dollars that were diverted due three separate security breaches. What’s being done to prevent further occurrences?
As a financial infrastructure, things like that will happen from time to time–not that we want them to, but obviously, because two things are involved there. We constantly inform our customers about the importance of protecting their infrastructure keys. We have no control if a merchant API is compromised. We constantly scale our infrastructure to allow our merchants the ability to protect themselves even as we grow. When this occurs, we are obligated to assist our customers in recovering the money that they have lost. We can do so by working with law enforcement or the police. This type of event reinforces the need for responsible reporting so that the public doesn’t think Flutterwave has been hacked due to a court order blocking certain accounts, when it wasn’t. We are just doing our job.
Clearly, fraud is best tackled at an industry level. We’re helping to build the ecosystem through collaboration with other fintechs, banks, and NIBBS, Nigeria’s national switch, and the EFCC, the law enforcement and crime agency, in order to combat cybercrime. As a partner with EFCC, we invested in a plan to build a Cyber Security Research Center where, as a resource, we offer support and advice and share trends and data on the state of fintech within the country. This is how we are helping to reduce the prevalence of fraud in our collective networks.
