Nigerian fintech startup, GladeFinance, is in talks to be acquired 

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January 16, 2024
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3 min read
partnerships

GladeFinance, a Techstars-backed Nigerian fintech, is in talks to be acquired, Techpoint Africa has learned.

According to a source close to the matter, at least two fintech companies — one Nigerian and one German — are involved in the talks, which could see the startup acquired barely three years after it began operations.

GladeFinance previously raised an undisclosed amount for its pre-seed round in 2022, getting into Techstars Toronto the same year. Plans were underway for a seed round in 2023, but that failed to happen amid the funding winter.

GladFinance CEO Victor Liyi confirmed, to Techpoint Africa, the receipt of acquisition offers in late 2023, aimed at extending the company's longevity, but declined to disclose further details.

Founded in 2020 by the ex-Interswitch product manager, GladeFinance started off providing business banking services in Nigeria but after a rebrand in 2023, it expanded its scope to include helping businesses across the globe receive and make payments. Currently, it provides payment services, expense management, multi-currency accounts, and working capital.

Before the rebrand, GladeFinance served more than 4,000 businesses, but in the last year, it has reportedly seen that number exceed 6,000. Last year, it was said to have processed more than ₦11 billion for these businesses, more than it had done in the preceding years and Victor maintains that there is still room for growth.

The potential acquisition deal may lead to the acquirer taking control of GladeFinance's customer base and technology, although it's still early to confirm. The fate of GladeFinance's current investors — whether they'll exit or receive shares in the acquirer —and Victor Liyi's potential role post-acquisition remain uncertain.

On rumoured layoffs

On the sidelines of the acquisition conversation, the company recently laid off 35% of its staff, the second one in the last year.

Before the first round of layoffs, which Victor attributes to performance issues, the startup employed 33 people, but after the latest cuts, it now has 17 employees. However, Victor maintains that the second round of layoffs is unrelated to the acquisition plans.

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“Every business is about unit economics," he clarifies, "If the numbers makes sense or not, you adjust accordingly. Just like with every company, making tough decisions is sometimes necessary to ensure our long-term viability. One thing for us is that the decision was never easy, and I deeply appreciate the dedication of every team member.”

Liyi Victor, GladeFinance founder/CEO. Source: Fintech Foundation incubation programme
Liyi Victor, GladeFinance founder/CEO. Source: Fintech Foundation incubation programme

There have also been salary cuts as the startup sought to extend its runway. Victor says he did not draw a salary from the company for two years.

Contrary to reports that claimed the startup had raised $450,000 in 2022, Liyi explains that it only received less than $50,000 outside its investment from Techstars, as some investors reneged on their commitments.

GladeFinance's impending acquisition is symptomatic of the current state of African tech. After a few years where startups broke one funding record after another, a global venture capital slowdown has hit startups hard.

Layoffs and shutdowns have become more common and experts have predicted a rise in M&A activities as a result. There were some acquisitions in 2023 including Risevest's acquisition of local rival, Chaka and Bitmama's acquisition of Payday and the trend is expected to continue in 2024.

Accidental writer, covering Africa's startup landscape and its heroes. Find me on Twitter @chigo_nwokoma.
Accidental writer, covering Africa's startup landscape and its heroes. Find me on Twitter @chigo_nwokoma.
Accidental writer, covering Africa's startup landscape and its heroes. Find me on Twitter @chigo_nwokoma.

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