Bamboo raises $15M in Series A, to build Tech API Infrastruture

Bamboo raises $15M in Series A, to build Tech API Infrastruture

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Buying a share on Amazon is perhaps one of the luxuries only a few individuals can afford. Despite the prospects of the multi-millionaire firm or return from its shares, it is somewhat difficult to pay for shares in total. You may have to defray the cost of almost $3,000 to get one. But through the intervention of its pioneer, Robinhood, people can have access to smaller shares in big establishments. Numerous globally recognized platforms created by Robinhood cater to the ever-increasing need to invest in the U.S. stocks market.

For instance, Bamboo was launched in Nigeria sometime in January 2020. That was a type of Robin Hood’s platform on the shore of Africa. After two years of significant growth and raising about $2.4 million to process it, the establishment is bringing it to the public domain that it has raised nothing less than $15 million in a new financing round. The Series A round was co-led by the U.S based Tiger Global and Greycroft. Apart from these companies, Saison Capital, Chrysalis Capital, Motley Fool Ventures, and Y-Combinator are prominent investors in Bambo0”s round, according to a statement released by Techcrunch.

There is a large room for an average Nigerian to save and invest with this platform. It is no longer a newsflash that Nigerian currency is devaluing daily. It is also widely known that we currently run on an almost 16% inflation rate. Therefore, creating and building a U.S stock portfolio placed you a hedge above others. For instance, the S&P 500 annually get a return of 10.5% from 1957 till date. Nigerians with HNIs had access to such services using their brokerage accounts and consulting assets and managers. The rigorous process and cost implication would not allow many average Nigerians to enjoy all the goodies. That is why Bamboo steps in as an established brokerage and retail investment app through a partnership with DriveWealth LLC.

The platform allows average Nigerians to set up accounts in a few minutes and use that same account to buy, trade, and invest in the U.S. stock market. “What we essentially want to do is to make investing in the global stock market easy for Africans,” said Richmond Bassey, who founded the company with COO Yanmo Omorogbe. “In accessing investment options, especially in capital markets, both locally and globally, we want to make that easy for Africans because we’re driven to help Africans create and preserve wealth by owning shares in the world’s most successful companies.” Before now, many Nigerians are not conversant with investing in the Stock market, but Bamboo has caused a change in the narrative. The number is increasing daily due to expertise in users’ retention and acquisition. Currently, the company can boast over 300,000 users. Of that number, about 20% are active traders, while 75% are novices who never traded before using the platform. Only in 221, repeat depositors on the platform rose to 85%. Moreover, they were only charged 1.5% per transaction, equivalent to #45. Bamboo is not the only firm in this business. Some notable companies like Rise, Chaka, and Trove offer the same services.

Though they differ in terms of the class of securities they offer. For instance, Bamboo gives access to U.S stocks ADRs, while Chaka deals with stocks and local and foreign capital markets. Of course, this is not without regulatory issues. Last April, Nigeria’s capital regulator SEC pronounced the activities of these investments as illegal. They further warned capital market operators to stop engaging in transactions with them. They were further accused of operating without licenses by the Central Bank of Nigeria.” A court order to freeze their accounts for six months pending CBN’s investigation followed. According to findings released by the CBN, the four fintech had a total of ₦15 billion (~$30 million) turnover from January 2019 to April 2021.” It’s unclear where Bamboo stands with the first directive, but Bassey confirmed to Tech crunch that the company received a court order to unfreeze its accounts.

Operating in a tight regulatory space has somewhat stood in the way of other features Robinhood and other investment platforms offer freely, yet Bamboo cannot, for now, such as crypto. “Stocks and selling stocks is a regulated business, and currently, we are only living in Nigeria. So working very closely with regulators in Nigeria, we have to work within the ambit of what they are comfortable with and what they allow. “That’s the extent to which we are offering our services. Perhaps if we launched in other markets and regulators there have a different relationship with a certain asset class, we would also work within the ambit of what they are comfortable with,” said the CEO.

He also stated that Bamboo is waiting for approvals from regulators to start offering Nigerian stocks before Q2 this year so Africans and those in the diaspora can tap into investment opportunities on the continent. The next market for Bamboo is Ghana. Over 50,000 users have joined, and it is still counting. Bamboo’s train is also moving to other African countries. Part of the funding will be used to scale the company’s tech infrastructure for smoother processes and faster withdrawals. The company also intends to introduce new offerings to add to its B2B product, allowing asset managers and Fintech companies to integrate

Bamboo into their offerings for their customers and trademark stock-trading products. Bamboo’s round at this stage is akin to Robin Hood’s Series A eight years ago, in terms of size. It’ll be unfair to assume that Bamboo can replicate the U.S. fintech giant’s growth trajectory over the years. Still, there’s no denying that with the backing of Tiger Global and Greycroft, who have backed successful retail platforms over the years (Robinhood and Public, respectively), the two-year-old Nigerian company is poised to reach mass scale across Africa in the following couple of years. “These are very early days. But, if you think about it with the kind of technology that we’ve put together, the kind of brand that we’ve created, the access that we do both locally and globally, then we’ve come far, we are a unique team that incepts a vision to say we want to get 1 million or 2 million Africans to invest in over the next 18 months and have a great shot at making it happen. We’re one of the few teams that can do that on the continent today, so the future is bright for us,” the chief executive remarked.


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