Zepz, the parent company of money transfer service Sendwave, has successfully raised $267 million in a fresh round of funding, aimed at fueling its expansion efforts across key African regions and beyond. This latest capital infusion came from a blend of both new and existing investors, underscoring the company’s robust appeal and growth potential in the financial technology space.
Leading the investment was Accel, a prominent venture capital firm, with additional contributions from Leapfrog Investments and TCV. Moreover, the International Finance Corporation (IFC), a division of the World Bank, has committed up to $20 million to further support Zepz’s strategic growth. This significant backing reflects investor confidence in Zepz’s future trajectory, particularly within its core African markets, such as Uganda, Kenya, Rwanda, Tanzania, and South Africa, where remittance services are crucial.
Zepz, which was originally known as WorldRemit, was founded in 2010 by Ismail Ahmed, a Somali-born entrepreneur who experienced firsthand the high costs of sending money to family members in East Africa. His frustration with the exorbitant fees in the remittance industry inspired him to create a solution, which ultimately grew into a pioneering UK fintech. By 2022, Zepz achieved full-year profitability and had become the first UK fintech company established by a black founder to reach a valuation of $1 billion.
The company has since expanded its operations, now providing money transfer services in over 150 countries. Some of its most active markets are located in Africa, where the need for affordable, reliable remittances is crucial for millions of families who depend on financial support from relatives abroad.
Despite its growth and strong market presence, Zepz has opted to delay its plans for an initial public offering (IPO). According to Bloomberg, this decision came as investors are in no hurry for the company to enter public markets. Accel’s partner, Harry Nelis, confirmed this sentiment, stating that while fintech funding has seen a resurgence, it primarily benefits more established firms like Zepz. The company’s decision to hold off on going public allows it to focus on its expansion plans without the pressure of meeting quarterly market expectations.
Nelis further emphasized that the remittance sector remains highly fragmented, with many smaller players still relying on cash-based services. This fragmentation presents opportunities for Zepz not only to grow organically but also to potentially acquire other firms, further consolidating its position as a leader in digital remittances.
CEO Mark Lenhard highlighted the continued relevance of Zepz’s services in times of crisis. Whether in response to global events such as natural disasters, political instability, or public health emergencies like the COVID-19 pandemic, people turn to remittance services to support their loved ones. According to Lenhard, these moments of uncertainty drive an increase in money transfers as individuals seek to provide for their families and communities in times of need.
Zepz’s most recent valuation was pegged at $5 billion during a funding round in 2021, following its acquisition of Sendwave, a cross-border payments platform. The acquisition marked a turning point for the company, not only by strengthening its operational capabilities but also by leading to its rebranding from WorldRemit to Zepz.
With its latest funding secured, Zepz is well-positioned to accelerate its growth across Africa and beyond. The company’s leadership in the digital remittance sector, combined with its innovative approach to addressing the needs of underserved markets, ensures that it will continue to play a critical role in global financial inclusion efforts.
Please note that this communication is for informational purposes only and does not constitute financial or legal advice; always consult with a qualified professional before making any financial or legal decisions.
