Telecoms firm Orange has invested in cash-to-goods money transfer startup Afrimarket, which has become a market leader in facilitating remittances from the African diaspora since it was founded two years ago.
The size of the contribution by Orange to the fundraising programme initiated by Afrimarket has not been disclosed, but the investment comes months after the operator’s chairman and chief executive officer (CEO) Stéphane Richard announced the two companies had entered into a commercial partnership.
Aside from the investment, Orange will participate in Afrimarket’s development through the sharing of market knowledge and other benefits of its strong brand.
Afrimarket facilitates money transfers in the form of “cash-to-goods” that enable individuals in Europe to pay directly for everyday goods or services in partner retail outlets for contacts living in Africa.
Orange said this type of service has grown into one of the most promising segments in the international money transfer market, and that its decision to take a minority stake in the company reflected its new strategy of funding startups through vehicles such as Orange Digital Ventures.
Pierre Louette, deputy CEO of Orange, said: “Afrimarket is a startup in the development phase with an original and promising offer. It’s a good example of the type of project that our new Orange Digital Ventures fund is interested in investing in. We’re supplementing Orange’s existing open innovation initiatives, such as Orange Fab”.
Disrupt Africa reported earlier this week on the launch of the Digital Ventures fund. The company has earmarked EUR20 million (US$22.4 million) for the fund in its first year, and made it available to any country in which it is present.
This includes 17 African countries, namely Botswana, Cameroon, Ivory Coast, Egypt, Equatorial Guinea, Guinea-Bissau, Guinea Conakry, Kenya, Madagascar, Mali, Morocco, Mauritius, Niger, Central African Republic (CAR), Democratic Republic of Congo (DRC), Senegal and Tunisia.
Orange Digital Ventures will focus in particular on startups in the fields of communication, connectivity, cloud, payments, the Internet of Things and big data, e-health and security services.
Orange is the latest operator to announce a desire to invest in African tech startups. Millicom in October launched the US$10 million Millicom Foundation, aimed at supporting digital innovators in Africa and Latin America, while the company’s ‘think’ accelerator programme launched in Kigali, Rwanda.
Leading Kenyan operator Safaricom launched a US$1 million investment fund aimed at supporting mobile ICT startups, while Airtel launched ‘Catapult-a-Startup’ in Nigeria, which will assist mobile app developers in scaling their businesses.