In May 2019, Serge Boupda stood before investors in a room at the Vivatech trade fair in Paris, pitching to raise $1.5m for his startup, Diool, which had then pivoted from a mobile recharge retailer to a fintech company after discovering that financial services access was the pain point of its target users in Cameroon.
Then, his startup had processed over one million euros’ worth of transactions in the central African country. But the investment did not come; even though the startup had just been the overall winner of the prestigious Seedstars Cameroon Competition a year ago.
A year before, a neighboring Nigerian fintech startup, Paystack, launched at the same time as Diool and which had long concluded its seed round, had announced an $8m Series A round. This was immediately followed by another investment of $10m in fellow country fintech startup Paga.
Now, two years have passed after the pitch at Vivatech, and Serge Boupda has taken some momentary rest to make a major interim announcement: that Diool has secured $3.5 million in funding, but not from the regular investors within the African fintech startup ecosystem.
“We do Cameroon and payments first. We also spent some time rebuilding the architecture and business processes, to match Cameroon’s new payment regulations — a critical part of delivering financial services in the region,” said Serge Boupda, Diool’s co-founder in a bare press release.
The Fundraising Journey Continues
While the latest funding brings with it a huge relief, Serge and his team will soon step out again.
In the meantime, they are focused on expanding at home. Thereafter, they hope to explore international markets apart from Cameroon.
“Our next stage is growing the team and product to scale in Cameroon ahead of entering other countries,” Boupda said.
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Who Are The Investors And Why Did They Invest?
Information about who the investors in this round were is scanty, except a statement that the investment came from the “Lundin family, plus existing investors”.
Based in Vancouver, Canada, the Lundin Foundation, in 2016, was part of Zambia fintech startup, Zoona’s $15m fundraise, alongside the IFC, Omidyar Network and Quona.
Particularly, the foundation has been very much active in the French-speaking parts of Africa. In 2015, it participated in Investisseurs & Partenaires’ 9.5m euros fundraise alongside Rothschild Foundation,Caritas, Small Foundation.
When not persuaded to invest out of its regular markets, the foundation invests in promising young businesses in Central Africa. The fund’s portfolio includes more than 30 different companies that have created thousands of local jobs.
Despite the excitement that usually comes with successful fundraising, Diool’s story, again, stresses the troubles facing startups in French-speaking Africa irrespective of the sectors they belong in. Last year, the $2.4million funding raised by Healthlane, which also runs a branch in Nigeria, was the only major fundraising headline made by a startup in Cameroon. Diool’s $1.2m was another, though not widely reported. Partech Africa report 2020 put the total figure of funding at $3.8 million, meaning that only Healthlane and Diool and a few others raised funding that year. All these are not withstanding the fact that Cameroon shares almost the same similarities (population, internet penetration, financial inclusion rate) with Ghana, which received $111m in startup investments in the same year.
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What You Need To Know About Diool
Founded in 2015, with a major pivot in 2017, Diool says it is one platform that performs multiple functions.
“Merchants want to serve customers fast and accept any payment method proposed. With the funds received, they buy more inventory from suppliers, add value and sell again. With one platform to manage their many operations, they can save time and costs of running business,” the startup notes on its website.
Put simply, Diool assists small merchants to accept payments from their customers and repay their suppliers, using many payment methods. The startup also maintains payments integrations across all mobile money providers in Cameroon. It also said it has partnered with French multinational investment bank and financial services company Societe Generale, based in Cameroon, in order to beat the demands placed on fintechs by regulations in the country.
After two years since its pivot, Diool has signed up more than 2,000 merchants. These merchants have transacted more than US$120 million using its platform.
Serge grew up in Africa, studied in Europe, and for 15 years traded complex financial derivatives in different markets around the world for a big French bank. For his part, Philippe Boupda, Serge’s younger brother and Diool’s co-founder, is a telecommunications engineer with extensive experience in working/integrating telecommunications systems.
The latest investment brings Diool’s total secured investment to US$4.6 million.
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