Breakthroughs, Resignations & Controversies Collide As Flutterwave Hunts IPO

By  |  November 8, 2023

Flutterwave Inc., Africa’s highest-valued startup, is navigating through a string of resignations after appearing to shake off previous controversies as it gears up for an initial public offering (IPO). The most recent exit is that of Chief Financial Officer Oneal Bhambani, a former American Express and Kabbage executive, who announced his departure less than two years after joining the payments company.

“Last week, I made the difficult decision to end my tenure at the company,” he shared in a LinkedIn post on Tuesday. “Thank you to Flutterwave for a seat on its journey to scale payments across Africa…” Earlier reporting by TechCabal quotes a Flutterwave representative saying “Bhambani has decided to pursue new opportunities and the company’s Head of Finance for Africa, Israel Koledowo, will lead the finance department on an interim basis.”

According to his LinkedIn post, Bhambani is heading to India to reconnect with old friends and colleagues, though there are concerns this marks a curious development for the fintech giant as it follows two other recent exits. Bhambani and two additional financial executives with treasury and corporate auditing experience from Kabbage joined Flutterwave. As of October, Oscar Lan and Rebecca Mendel, those executives, have also departed the organisation.

Bhambani’s resignation comes at a crucial moment for Flutterwave, as the company chases listing in the public markets having emerged from a wave of controversies. Last year, the Kenyan High Court froze its bank accounts under anti-money laundering rules, dealing a significant blow to the venture capital-backed startup with a valuation of USD 3 B.

The road has not been without hurdles. Flutterwave has faced a barrage of allegations, including mismanagement, sexual harassment, administrative errors, and security breaches since April 2022. And leadership under co-founder/CEO Gbenga Agboola, who himself is accused of wrongdoing in some of the allegations, have at times been called into question.

In separate interviews last year, Agboola and erstwhile Flutterwave CEO Iyinoluwa Aboyeji fielded questions alluding to a US SEC inquiry into Flutterwave in 2017, which had gone unreported until it was publicised, alongside other controversial details, by the prominent Nigerian independent investigative journalist David Hundeyin. Both co-founders maintained that Flutterwave fully complied and the matter had been resolved.

Earlier this year, it was reported that Flutterwave suffered a major security breach where hackers stole NGN 2.9 B (USD 3.7 M) from its accounts. Although the company has issued public denials of the issue, court documents revealed that Flutterwave’s legal counsel sought police assistance to recover funds from 107 bank accounts in 27 banks that allegedly received money from the illegal transfers.

Despite these challenges, industry experts believe that Flutterwave’s significance in the African tech ecosystem positions it as a key player, making it almost indispensable despite its controversies. It is noteworthy that the fintech has raised USD 474 M in total funding from major venture capital firms such as Tiger Global Management LLC, Y Combinator, Greycroft, Omidyar Network etc., and has partnered with industry giants including Alibaba’s Alipay, Uber Technologies Inc., and Netflix. As of 2022, Flutterwave has processed close to USD 20 B in payments and 100 million transactions across over 33 African countries where it currently operates, according to data published by Y Combinator.

Amid the controversies over the past year, Flutterwave has continued to make headway, securing some notable victories on the business side of things. The company made headlines recently with a series of licenses acquired and strategic partnerships aimed at expanding its business reach. One such collaboration involved payment infrastructure provider, enabling Flutterwave’s merchants to access customers in the U.K. and Europe. Additionally, the fintech firm entered into a partnership with popular U.S. music-streaming platform Audiomack and inked a five-year agreement with Microsoft to facilitate transactions on Azure across the African continent. These developments signify a positive shift for Flutterwave, showcasing resilience amid adversity.

The company’s ability to secure partnerships with global giants like Microsoft can be attributed to its vast market size and strategic positioning. Microsoft, in particular, seeks to expand its merchant base in Africa, making Flutterwave a valuable ally in reaching businesses across the continent. This underscores the importance of scale and influence in the competitive fintech landscape.

However, as Flutterwave prepares for its IPO, questions arise about its reputation and internal operations. With its ambition to go public, the company would hope to be on the right side of public opinion, especially in America, where institutional and retail investors will scrutinize its governance and culture closely.

Flutterwave finds itself in a unique position—a company hailed as Africa’s most valuable startup, now drawing public scrutiny as it navigates the complexities of the financial world and prepares for its IPO, Flutterwave would be looking to strike a delicate balance between addressing past controversies and showcasing its potential as a leading player in Africa’s fintech revolution.

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