The payment system in Africa is still fragmented, with multiple payment providers providing different payment options to both customers and businesses. The fragmentation of payment systems leads to payment failures, which are inevitable due to factors such as invalid cards, inactive accounts, and high dispute rates.
Revio, one of the few startups working on payment orchestration to address this fragmentation, is one of the few startups working on payment orchestration to address this fragmentation. The co-founder and CEO of the startup, Ruaan Botha, said TechCrunch: After learning how much time and manual effort businesses spend collecting payments across various providers and engaging customers on outstanding and failed payments, Ruaan Botha, the co-founder and CEO, told TechCrunch.
The two-year-old startup offers companies in streamlining their order-to-cash lifecycles while addressing issues brought on by employing various payment options via its APIs. The startup has received $5.2 million in seed funding to enhance its efforts in addressing these failed payments that charge digital businesses billions in recurring revenue annually.
This is the second round of funding that Revio has received in the last 12 months. In November, the VC secured $1.1 million in pre-seed funding from investors, including Speedinvest, Ralicap and Everywhere VC. The investors included follow-on checks in the QED-led seed round, alongside growth-stage pan-African VC Partech.
According to the co-founder and chief operating officer Nicole Dunn, the participation of QED and Partech in Revio's seed round is a testament to the importance of its product.
Orchestration reduces the cost, risk, and complexity of payments.
As a business operates in multiple countries and accepts diverse payment methods, it is becoming increasingly crucial to utilize payment orchestration platforms. Just as Primer, Spreedly, and Zooz, via their APIs, handle this heavy lifting in the U.S. and Europe, Revio and similar upstarts, including Egypt-based MoneyHash, do the same for Africa.
Dunn said that Revio has developed an order-to-cash lifecycle or end-to-end payment value chain that merchants can use to collect revenue from their customers. Through its API, these merchants connect with more than 70 payment methods and service providers, enabling them to access transaction routing, automated failover, and retries, and real-time customer engagement processes to increase payment success rates.
In addition, Revio unveiled a revenue recovery case based on the understanding that payment failure in Africa may be caused by technical difficulties, which can also result in insufficient funds or an abandoned authorization. It's really around bridging the merchants' need to connect with consumer realities on the ground, he said. And that has been quite different in the broader market context, he said.
To achieve enough value for companies that transact across various markets, payment orchestration platforms need broad coverage. The Cape Town-based fintech has made strides in that regard, expanding its scope to encompass over 25 African markets.
Even though Revio has roughly 50 customers, less than half of them - enterprise and mid-market customers - are mostly responsible for this growth in coverage. Last year, Revio identifies its clients as large-scale enterprises to midmarket corporations and fast-growing scale-ups involved with recurring revenue businesses and high transactional volumes. Due to learnings over the past year, Revio concentrates more on large-scale enterprises with complex payment requirements.
These clients include four of Africa's largest insurers and two of the continent's largest telcos.
Dunn said Revio has seen its revenue growth by 1,000% in the past year, and plans to target global retailers servicing the African market during its next development phase. She said the startup has started interactions with a few of these merchants to understand better what it would take to service them effectively, mainly as it builds capabilities around cross-border reconciliation settlements. The new capital injection will strengthen the company's technological capabilities and broaden its staff by bringing in skilled employees from within and outside the continent.
The issue has been fully resolved. Revio is building a platform that can unlock increased e-commerce and digital payment activity on the continent and help global and local merchants reach new customer segments, said Gbenga Ajayi, partner and Africa lead at QED Investors.