(Bloomberg) — Zepz, the money transfer service formerly known as WorldRemit, has raised $267 million from new and existing investors to fund expansion in its core African markets and beyond.
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Venture capital firm Accel led the funding round, which also included Leapfrog and TCV. The International Financial Corporation, a global development institution and member of the World Bank Group, pledged to invest as much as $20 million.
Zepz declined to disclose its valuation. The group was last valued at $5 billion when it raised money in 2021, shortly after WorldRemit acquired cross-border payment firm Sendwave and rebranded. That integration led Zepz to lay off more than a quarter of its workforce in May 2023.
The firm has parked plans for an initial public offering, Bloomberg reported previously, and investors are now “in no rush” for Zepz to join the public markets, according to Harry Nelis, partner at Accel.
“It’s fair to say fintech funding is back, but for the established companies,” said Nelis, who has backed WorldRemit since its early stages. Nelis said remittances were still part of “a very fragmented industry,” creating opportunities for Zepz to expand and potentially acquire smaller firms as more customers shift from cash transfers to online services.
Founded in 2010 by Somali refugee and entrepreneur Ismail Ahmed who was frustrated at the high transaction fees to send money to his family in East Africa, WorldRemit became the UK’s first Black-founded fintech company to be valued at $1 billion and reach unicorn status. Zepz said it reached full-year profitability in 2022.
Mark Lenhard, Zepz chief executive officer, said the firm had further to grow. “We certainly saw it during Covid. We’ll see it when there’s an earthquake. We’ll see it when there’s geopolitical unrest in the country,” he said in an interview. “More money will flow in because people get concerned about their families, about their communities and that’s their time of need.”
Fintech companies are slowly coming back for fresh funding this year after a slump in valuations from record-breaking highs. Monzo Bank Ltd. raised funds that valued the British startup at $5.2 billion, while Revolut managed to increase its valuation to $45 billion through a secondary share sale that allowed employees to sell their stakes.
(Updates to add detail on profitability in sixth paragraph. A previous version removed company’s incorrect information about one investor.)
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