Invest in African Startups & Real Estate | Diaspora Investment

From Finance to Fintech: The Story of Borderless

In 2017, Joe Kinvi joined Touchtech Payments as the head of finance. The Irish startup was unable to meet his full salary expectations at the time. Consequently, a negotiation resulted in stock options to compensate for the difference.

Eighteen months later, Stripe acquired Touchtech Payments. This acquisition converted Kinvi’s equity into Stripe shares, providing him with the financial freedom to leave his position, initiate a personal project, and ultimately establish a new company.

Borderless: Investing in Africa from the Diaspora

The resulting startup, Borderless, is focused on facilitating collective investments in startups and real estate within Africa for individuals residing in the diaspora. Since its beta launch last year, the U.K.-based platform has successfully processed over $500,000 in transactions.

“A significant amount of money is sent home as remittances, yet a limited portion is directed towards productive assets,” Kinvi explained. “Our vision is to create a system where the appropriate collectives can easily access suitable investment opportunities.”

The Genesis of Borderless: Hoaq Investment Club

Kinvi’s path to Borderless began in 2020, coinciding with the onset of the pandemic. He and a group of associates formed Hoaq, an investment club designed to pool smaller investments from both local and diasporan angel investors into promising African startups.

One of their initial obstacles was securing a bank account. Financial institutions scrutinized their activities, leading to repeated freezes of their account with Wise. Further challenges emerged, including currency discrepancies, regulatory compliance, and accreditation rules that complicated collective investing.

To navigate these complexities, the group utilized membership fees to engage legal counsel for manual paperwork processing. This experience ultimately led to the development of light automation within Hoaq’s workflow, forming the basis for Borderless. Hoaq has since invested in companies like LemFi, Bamboo, and Chowdeck.

Transitioning from Stripe and Paystack

By 2022, Kinvi had departed from Stripe, where he had transitioned into a product and growth-focused role. He subsequently spent a year at Paystack, a Stripe subsidiary, concentrating on expanding financial partnerships throughout Africa.

Upon revisiting the challenges initially encountered by Hoaq, he developed a tool to digitize all aspects of the process, from onboarding to fund disbursement. This internal solution quickly attracted external interest, with other collectives seeking access for investments in real estate and other asset classes.

Borderless Infrastructure and Growth

Currently, Borderless offers back-end infrastructure for diaspora collectives. This allows them to onboard members, accept cross-border payments, and deploy capital in a secure manner.

The startup reports a waitlist exceeding 100 communities. Over the past few months, collectives utilizing the platform have invested in over 10 startups and two real estate projects in Kenya, with minimum investment amounts of $1,000 for startups and $5,000 for property.

Borderless operates under U.K. regulatory oversight, enabling it to market investment opportunities to diaspora members without contravening securities regulations.

Future Expansion and Addressing Investor Concerns

While currently focused on startups and real estate, Kinvi envisions expanding into other asset classes, including film and diaspora bonds.

Kinvi emphasizes the importance of trust in the Borderless model, acknowledging that many diaspora investors are hesitant due to past experiences of financial loss through informal investments.

“An acquaintance of mine sent €200,000 home to finance the construction of a house,” he recounted. “Unfortunately, the house was never built.”

To mitigate this risk, Borderless directs investor funds directly to verified sellers, escrow accounts, or legal representatives. Funds do not pass through the hands of collective managers. Legal and compliance checks are integrated into the process, and all opportunities require approval under the platform’s regulatory framework.

Revenue Model and Market Opportunity

Borderless generates revenue through transaction fees, a portion of membership dues, and foreign exchange spreads. The company may also introduce remittance products, payout fees, and asset management tools in the future.

Kinvi believes the larger opportunity lies in unlocking the $30 billion in migrant savings that remain uninvested annually. While remittance platforms like Zepz, Taptap Send, LemFi, and NALA currently dominate the remittance market, few offer long-term investment options.

Investor Support and Mission

Borderless has attracted investment from DFS Lab, Ezra Olubi (Paystack CTO), Olumide Soyombo, and executives from Stripe and Google, many of whom are also active users of the platform.

Having raised $500,000 in pre-seed funding, Kinvi views Borderless’ mission as extending beyond financial returns. “Many Africans in the diaspora aspire to return home,” he stated. “To achieve this, they require a secure and reliable means of investing at scale, and that is precisely what we are developing.”

Challenges and Future Considerations

Scaling the platform will present challenges. Borderless’ current vetting process relies heavily on established relationships and trusted collective leaders. As the platform expands, it will require robust identity verification, fraud detection mechanisms, and legal tooling to prevent exploitation by malicious actors.