Nigerian fintech startup, Cleva, has raised $1.5 million in a pre-Seed round .
The round was led by 1984 Ventures, an early-stage venture capital firm based in San Francisco.
Other participants in the round include The Raba Partnership, Byld Ventures, FirstCheck Africa, and several angel investors.
Y Combinator also participated as Cleva joins the accelerator’s winter 2024 batch this month.
The startup said it will use the fund to expand its business.
How Cleva Operates
Cleva is in the business of helping African individuals and businesses receive international payments by opening USD accounts.
The platform lets users open USD accounts, with onboarding requiring a Bank Verification Number (BVN) and a government-issued ID.
Facilitating payments for remote workers and freelancers in Africa is estimated to be an $18 billion opportunity.
Cleva generates revenue when users swap and exchange their funds (in USD accounts) for the local currency ( naira for now.)
It also charges a 0.9% fee on deposits into customers’ USD accounts.
Unlike other similar platforms who often apply an uncapped 1% fee, Cleva caps fees at $20 regardless of the amount received.
The fintech has facilitated the opening of US-based accounts for thousands of Nigerians.
Processing payments worth over $1 million monthly, Cleva experiences 100% month-on-month revenue growth.
Confidence in Competence
Both the investors and the founder have expressed confidence in what Cleva can deliver.
Aaron Michael, a partner at 1984 Ventures, expressing his confidence in the startup cited their early growth as proof of competence.
He said;
“The team is uniquely qualified to address this given their experience building banking products at Stripe and robust platforms at AWS. The impressive early growth is a testament to the team’s unique capacity to execute across Africa and the U.S..”
He added that their product provides a means for Africans to navigate hyperinflation challenges.
From the founders’ end of the table, co-founder Tolu Alabi said:
“The problem that we’re trying to solve, which is enabling people to receive international payments, is not a Nigerian problem nor an African one. It’s a global problem;… “
“…We’re starting with Nigeria because we know the market and it’s also a big market. But we feel like because of our backgrounds, we’re very well positioned to solve this problem at a global scale.”
The Founders
Tolu Alabi and Philip Abel are MIT and Stanford alums respectively.
Born and raised in Nigeria, they both moved to the US on college scholarships.
The co-founders have had roles at major tech companies, including Amazon, Stripe, AWS, and Twilio.
They founded Cleva in 2023 bringing with it their vast technical and product experiences.
