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OPay hits $3B valuation in 2024 amid Nigeria's digital payment surge

OPay, backed by Sequoia Capital and Softbank, approaches a $3 billion valuation, marking a 30% increase since its 2021 Series C funding round.

OPay's story is really interesting. They grew super fast because they got a lot of money from investors and because more and more people in Africa are using financial technology (fintech) as a means of managing their day-to-day financing.

Since its Series C funding round in 2021, OPay, a Nigerian fintech startup supported by Sequoia Capital and Softbank, has seen its valuation soar by more than 30%, according to recent filings by Opera, an early investor in OPay. The surge in valuation highlights the impact of Nigeria's digital payments boom in fostering a new wave of financial technology companies. 

In 2018, Opera, a company that makes internet browsers, acquired Paycom, a Nigerian mobile money operator, which was later rebranded as OPay. At first, OPay didn't have a set value because it was new and wasn't making money yet. But because Opera was already big in Africa, people thought OPay could do well.

In 2019, OPay got its first big chunk of money from investors, called seed funding. They got $50 million, and that made people think OPay was worth about $500 million. This money helped OPay a lot and showed that people believed in it, especially in Nigeria, where it was trying to change how people handle money on their phones.

Then, in 2021, OPay grew even more. They got $400 million from investors, led by SoftBank Vision Fund 2. Now, people thought OPay was worth $2 billion, making it a "unicorn" in the business world. This means it was one of the rare startups worth over $1 billion. This big success showed that OPay was doing something really important in Africa, even more than some of the biggest banks in Nigeria.

Meanwhile, Opera's stake in the company gradually decreased, reaching 6.4% in the same 2021. However, in early 2023, Opera's stake increased to 9.4% after it sold its Asian fintech subsidiary, Nanobank, to OPay in exchange for equity.

According to filings with the US Securities and Exchange Commission (SEC), Opera valued its 9.4% stake in OPay at $253 million, implying a valuation of $2.7 billion for OPay. This valuation represents an increase from the previous funding round, which valued the startup at $2 billion. 

OPay experienced significant growth in 2023, partly due to a currency redesign that led to cash shortages, prompting more people to turn to fintech apps like Moniepoint and OPay for transactions. This surge in digital payments pushed national payment volumes to record levels, reaching N611 trillion by the end of the year, according to the Nigerian Inter-Bank Settlement Scheme (NIBSS).

OPay benefitted from this momentum, quadrupling its user base and increasing revenue by over 60% on a constant currency basis, as reported to shareholders by Opera. However, despite its growth, OPay, like other fintechs, faces challenges related to fraud and customer safety, leading regulatory bodies such as the Central Bank of Nigeria (CBN) to tighten rules on account safety.

There are a few reasons why OPay became so valuable

  • OPay helped a lot of people who didn't have access to banks by making it easy to do money stuff on their phones.
  • OPay worked with other popular services, like ride-hailing and food delivery, to make paying for such services easier.
  • Big companies believed in OPay and gave them lots of money to grow even bigger.

What you should understand

If OPay can do well in other African countries, not just Nigeria, its valuation can increase. In addition, if OPay can keep making new money services that people like will also boost its expansion and valuation. Moreso, if OPay can handle any changes in the rules that African governments make about money stuff, it'll overcome any scrutiny coming it way.

Lastly, OPay's journey shows how big fintech can be in Africa. However, whether they can keep growing and stay on top will depend on how well they can change and grow in Africa's fast-moving market.

What is OPay Valuation in 2024?

According to filling to the US Securities and Exchange Commission (SEC) in April 24, 2024 by Opera, OPay's valuation nears $3 billion. Additionally, Opera told investors its 9.4% stake in OPay was valued at $253 million. Precisely, OPay has a valuation of $2.7 billion in 2024.

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About the Author

With five years experience in Media, Temmy Samuel's become a modern journalist, delivering impressive reporting about tech, finance, business and science around the world. More About Temmy

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