Mono Raises Funding to Expand African Internet Economy

Mono Secures $2 Million Seed Funding to Expand its African Fintech Platform

In February, the Nigerian fintech company Mono initially aimed to replicate the success of Plaid within the African market. However, the startup’s objectives have evolved. Now, Mono is focused on becoming a driving force behind Africa’s expanding internet economy.

Recent Investment and Funding History

This ambition is supported by a recently secured $2 million seed investment. This funding arrives nine months after a $500,000 pre-seed round concluded last September, and two months following a $125,000 investment from Y Combinator.

Mono’s cumulative funding now totals $2.625 million. Key investors in this latest round include Entrée Capital, known for its investment in Kuda’s seed round, Babs Ogundeyi – co-founder and CEO of Kuda, Gbenga Oyebode – a partner at TCVP, and Eric Idiahi – co-founder and partner at Verod Capital.

Lateral Capital, a New York and Africa-based venture capital firm, also participated, having previously invested during Mono’s pre-seed stage.

Addressing Financial Inclusion in Africa

Across the African continent, a significant portion of the population remains unbanked or underbanked. Companies like Mono are actively working to enhance financial inclusion and connectivity.

Open finance is predicated on the idea that readily accessible financial ecosystems, facilitated by open APIs, can lower barriers to entry and reduce costs for those currently underserved by traditional financial institutions.

Mono’s Core Functionality and Growth

Established in August 2020, Mono provides a streamlined API that consolidates diverse financial data for businesses and developers.

With user consent, the platform enables access to crucial information such as account statements, real-time balances, transaction history, income details, expense tracking, and account holder verification.

Early this year, Mono had already established partnerships with over 16 financial institutions within Nigeria. More than 100 businesses, including Carbon, Aella Credit, Credpal, Renmoney, Autochek, and Inflow Finance, are utilizing Mono to access customer bank statements, identity data, and account balances.

To date, Mono has successfully connected over 100,000 financial accounts for its partners and processed more than 66 million financial transactions.

Beyond Open Banking: A Data-Driven Future

CEO Abdul Hassan acknowledges the company’s rapid progress and product-market fit. However, he emphasizes that the API fintech sector represents merely a stepping stone towards Mono’s broader vision of becoming a comprehensive data company.

Hassan explains, “The payments market in 2016 was considerably smaller than it is today, with a limited number of individuals utilizing cards online. A similar situation exists for us currently.”

He continues, “Our focus extends beyond open banking to encompass data in its entirety. We are exploring how we can leverage data – not exclusively financial data – to power the internet economy. Consider the potential of open data for telecommunications companies, allowing users to seamlessly transfer their data between providers without the need for new SIM cards and registrations.”

Strategic Expansion and Product Development

Mono is adopting a phased approach to product development, gradually expanding its capabilities beyond financial data offerings. This includes integration with payment gateways like Paystack and Flutterwave, as well as fintech companies specializing in wealth management, such as Piggyvest and Cowrywise.

The company’s strategy centers on establishing connections to all available data sources and making this information accessible to businesses and developers.

Pan-African Expansion Plans

The newly acquired funding will be allocated to strengthening Mono’s existing financial and identity data services and launching new products tailored to various industries. A key priority is expansion into Ghana and Kenya.

While previous plans to enter these markets by the end of Q1 did not materialize, Mono is now preparing to launch in Ghana next month, serving both existing Nigerian customers and new clients in Ghana. Partnerships have been secured with five banks – GTBank, Fidelity Bank, and three others yet to be announced – and MTN Ghana’s mobile money service.

Hassan notes that customer demand is a primary driver of expansion and product innovation. “We collaborate closely with our customers to provide them with the tools they need to create innovative experiences for their own users.”

Investor Confidence in the African Fintech Landscape

Mono is one of three API fintech companies in Nigeria to secure seed funding this year. Okra raised $3.5 million last month, while Stitch, a South African API fintech, launched with $4 million in February.

These successive investments demonstrate strong investor confidence in the African market. Avil Eyal, managing partner and co-founder of Entrée Capital, stated, “We are thrilled to collaborate with Abdul, Prakhar, and the entire Mono team as they continue to build the infrastructure for African banking, enabling the delivery of financial services to hundreds of millions of people across the continent.”