Bitcoin is making progress growing throughout emerging markets worldwide. Africa seems to be the next area for growth in the market of international currency transfers and remittances, via the Bitcoin startup BitPesa. Now, with the help of California’s Pantera Capital Management LP, BitPesa has received over $1 million USD in new funding for their burgeoning Bitcoin operations in Africa.
In business since November of 2013, BitPesa has started sales of Bitcoin in Kenya and Ghana, and now has a team of 9 full-time employees. BitPesa’s growth has been featured on the World bank’s website and the entrepreneurial magazine Fast Company. BitPesa ended their first year in business with over $1.7M in equity. This current round of investment round was managed by Pantera Capital Management LP, with support from the Crypto Currency Partners LP, Stephens Investment Management LLC. Existing shareholders the Bitcoin Opportunity Corporation and Future/Perfect Ventures, among others also were participating.
“We’ve learned a lot, and we’re growing,” Elizabeth Rossiello, BitPesa’s CEO and co-founder, told New York Times’ MoneyBeat. “We’re surprised ourselves (with) how many people are excited about (Bitcoin).”
Dan Morehead of Pantera Capital Management LP has now been added to Bitpesa’s Board of Directors, joining Joseph Mucheru, Duncan Goldie-Scot and Jalak Jobanputra. And this new funding allows them to expand operations from Kenya and Ghana to Tanzania and across the eastern region to meet the established demand for low-cost international transfers. Bitpesa’s goal is to take over 1% of the region’s remittances market from established players like Western Union by May of this year. How they intend to accomplish this is simple: Use the naturally lower costs of Bitcoin as a medium of economic transfer. 10-12% in average remittances fees with Western Union would drop 75% to around 3-4% using BitPesa. BitPesa also is the only company filling this market gap in the East Africa region, now including Ghana.
Also read: Bitcoin 1 – Western Union 0
The firm now also offers a brokerage service that can buy and sell bitcoin on behalf of their customers. They have discovered that the remittance service is somewhat limited by how well the Bitcoin market it is set up for expats to buy bitcoins in their host countries. Canada’s become a big market for them because buying Bitcoin in Canada is easier than it is in the United Kingdom, for example.
Early beta tests on local market demand have been very promising, as they needed to hire an additional trading assistant ton handle January’s volume of trades. This, no doubt, helped secure the additional funding recently. The average daily trade amount in Africa has shown steady increases, and each user is trading more frequently every month. Give Directly has also partnered with BitPesa to facilitate Bitcoin use in the area, and they have just sent their first trade through the BitPesa platform. And both Kenyan and Ghanian commercial businesses have been using the remittances service to trade to business abroad, so it is not just for the average consumer.
Image provided by Wikimedia.
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