HUB2, a fintech startup based in Ivory Coast, has successfully raised $8.5 million in Series A funding. The round was spearheaded by TLcom Capital, a leading pan-African venture firm, with contributions from FMO, Enza Capital, BPI France, and Eric Barbier, founder of the payment platform Thunes. This capital injection is aimed at scaling HUB2’s operations, expanding its partnerships, and advancing its technology stack to address critical payment challenges in Francophone Africa.
The investment will enable HUB2 to process €1 billion in transaction volume in 2024, a dramatic leap from the €70 million handled in 2022. Part of the funds will be used to introduce new services such as stablecoin-based remittance solutions, expand cross-border payment capabilities, and enhance card payment integrations via CyberSource, Visa’s payment processing platform. These developments are designed to reduce financial fragmentation and promote interoperability in the region’s payment ecosystem.
HUB2 currently partners with 55 financial service providers, including neobanks, mobile money operators like Wave and Orange, and remittance firms. The company plans to extend its footprint across Francophone Africa, targeting markets such as Senegal, Burkina Faso, Benin, Togo, and Cameroon, with the goal of achieving full regional coverage within two years. Its growth strategy also includes exploring the underserved small and medium enterprise (SME) segment, which constitutes 90% of African businesses.
Why the Investors Committed Capital
The decision by investors to back HUB2 reflects the startup’s strategic importance in addressing critical financial bottlenecks in Francophone Africa. The region is characterized by low banking penetration, payment fragmentation, and the lack of interoperable systems, all of which stifle economic development. HUB2’s platform offers a unifying solution, integrating diverse payment methods into a seamless system, making it attractive to investors seeking impactful and scalable innovations.
HUB2’s focus on fintechs, which drive 98% of its transaction volumes, showcases a targeted approach that has yielded significant results. Its steady month-over-month growth in transaction volume and revenue demonstrates scalability and operational efficiency. The company’s pivot to serving fintechs has enabled it to establish product-market fit and position itself as an indispensable partner for financial institutions in the region.
Investors were also likely influenced by the track record and vision of HUB2’s leadership team. Co-founder Ashley Gauzere’s deep understanding of regional challenges, gained from years in the telecom sector, and the expertise of co-CEO Jean-Rémi Kouchakji, who joined in 2023, provide confidence in the company’s ability to navigate complex market dynamics. Furthermore, TLcom Capital’s involvement signals confidence in HUB2’s capacity to replicate the success of similar ventures in Anglophone Africa.
The scalability of HUB2’s model beyond its current focus on fintechs to include SMEs presents an untapped growth opportunity. By addressing the needs of small businesses, HUB2 could emulate competitors like Paystack and Flutterwave, which have successfully blended enterprise and SME strategies to drive growth. This potential for broader market penetration likely factored into the investors’ decision to support HUB2.
A Look at HUB2
HUB2 was founded in 2019 by Ashley Gauzere, a former telecom engineer with extensive experience at Orange Africa and the Middle East. The startup was conceived to solve the pressing issue of payment fragmentation in Francophone Africa, where financial institutions operate in silos, making it challenging to process payments across different systems.
Initially targeting independent e-commerce merchants, HUB2 pivoted to large corporates before eventually finding its niche in serving fintechs. This third pivot has proven highly successful, as fintechs now account for nearly all of the company’s transaction volumes. Today, HUB2 partners with prominent players such as Julaya, NALA, Onafriq, and CinetPay, enabling these companies to collect payments via mobile money, bank transfers, cards, and cryptocurrency through a single API.
The company’s operations are headquartered in Ivory Coast, with additional offices in France and Mauritius. It currently employs a team of 35 and operates in six Francophone African countries, including Senegal, Burkina Faso, Benin, Togo, and Cameroon. HUB2’s roadmap includes expanding its geographical reach to achieve full coverage of Francophone Africa and diversifying its offerings to address evolving market demands.
HUB2’s robust growth trajectory is reflected in its ability to scale transaction volumes and revenue consistently. The company’s commitment to building a unified, interoperable payment infrastructure has positioned it as a pivotal player in Francophone Africa’s fintech ecosystem, making it a standout candidate for investment and a vital driver of financial inclusion in the region.