Sudo Africa, a Nigerian company, has raised $3.7 million in pre-seed funding for its card-issuing API platform.

Global Founders Capital (GFC), based in San Francisco, led the financing. Picus Capital, LoftyInc Capital, Rallycap Ventures, Kepple Africa, Berrywood Capital, ZedCrest, and Suya Ventures are among the investors. Several African fintech entrepreneurs, like Olugbenga ‘GB’ Agboola, Ham Serunjogi, and Odun Eweniyi, are also investors. Card-issuing API (pioneered by the likes of Rapyd, Ayden, and even Stripe worldwide) is gradually attracting the attention of investors who believe it’s the next big thing in a sector that has drawn the most VC funds in Africa, similar to many other API-led fintechs.

Sudo Africa’s founders, Aminu Bakori and Kabir Shittu, said  that the opportunity to build Sudo came from a problem they encountered while trying to issue cards at their previous startup: a mobile wallet system that allowed users to aggregate existing financial institutions into a single platform and conduct transactions.

“At some point, we decided to issue cards and partnered with one of Nigeria’s local banks,” CEO Bakori explained. “They were given the ability to print up to 1,000 cards, but it took a long time and none of them worked because the bank was unable to provide any APIs for us to manage the cards or even restrict their use.” We came around for the first time that day, thinking about how to issue out cards. According to Bakori, the fintech landscape is one in which, while entrepreneurs build silo interfaces that allow their clients to send and receive payments between themselves, problems develop when global financial systems are involved. Using a mobile wallet or local card in Nigeria to make an Amazon purchase, for example, is always a nightmare. This has become less of an issue with the advent of virtual dollar cards in a few digital banks and fintech companies. This technology is powered by card-issuing API fintechs like Kaduna-based Sudo Africa.

Customers are told that whereas banks take weeks or months to issue cards, Sudo Africa does so in days. The company’s infrastructure, which is built in collaboration with licensed card issuers, allows it and any developer or merchant who joins its platform to issue virtual and physical cards to their customers. Businesses can also customize and program cards to their liking, add functionality, and securely integrate with other services on the platform. Here’s a more detailed explanation. If a company uses Sudo Africa to issue cards for employee expense management, the employees are given cards with a low balance, so whenever they need to use the card, an API is called to decide whether to approve or deny the transaction in real time. Another example is a delivery service that sends a dispatch rider to a mall with a programmed card to perform a transaction and spend a set amount of money. Sudo’s API is designed in such a way that the card will not operate if the rider decides to use it in another mall for whatever reason or spends more than the intended budget.

“This is more than just generating a prepaid card, funding it, and then letting the customer spend wherever he wants,” Bakori explained.

“So all of these controls we’ve put on the card, like spending controls where you can set how much can be spent, where it can be spent, and when, put the company in the front line and say, ‘hey, these are all the transaction details and spending controls, but do you want to go ahead and approve this transaction?’ This creates a stream of opportunities for fintechs and businesses who use our platform.” The founders argue that these features — spending and regional controls — set Sudo Africa apart from other card-issuing API startups such as YC-backed Union54 and unicorn Flutterwave. However, based on the features each company claims to have on their websites, it appears that the three are nearly identical.

Sudo customers span a number of sectors. Shittu, the company’s COO said  They include fintechs, microfinance banks, non-tech enterprises, government agencies, logistics companies, commercial banks and e-commerce companies, he said. When its issued cards are used to execute an online or POS transaction, the corporation collects interchange fees, and it takes authorization fees when spending and location-based controls are performed. According to Shittu, Sudo collects lower card production and personalization fees than incumbents.

Sudo Africa is now the only company in this market that only provides virtual and physical cards to Nigerians. Despite being founded in Zambia, Union54 has consumers all around Africa. Flutterwave claims to assist retailers in 35 African markets in issuing virtual cards, with real cards currently available only in Nigeria. Sudo Africa, which is setting an example for other fintechs and startups looking to build a name for themselves outside of Lagos, is likely to want to expand to other African markets with this financing, not out of competition, but out of necessity.

Right present, our main priority is expanding into other African countries. So we’re expecting to be in three or four additional African countries by the end of the year,” said the chief operating officer.


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