Thepeer, backed by Flutterwave, aims to make data sharing easier for businesses through its API
Thepeer, backed by Flutterwave, aims to make data sharing easier for businesses through its API
The Internet and technological advancements have radically altered every aspect of our lives as we previously knew them. The last two decades have seen a sea change in everything from education to healthcare to transportation to financial services.
As a result of the ease with which technology can be integrated into business processes, users' expectations have shifted. Customers these days expect efficiency and speed, and startups are springing up to meet and exceed their expectations in these areas.
In comparison to today, money transfer from one bank to another was very different 25 years ago. It was not uncommon for transfers to take several days to reach their intended recipients. To withdraw money from your account, you had to go to the branch where your account was opened.
Although the banking industry has evolved to the point where transfers can now be completed in a matter of minutes, this has been made possible by technological advancements. Furthermore, as a result of these transformations, the industry has experienced unprecedented growth.
Fintech startups are following in the footsteps of banks such as United Bank for Africa and Guaranty Trust Holding Company, which disrupted the financial system less than two decades ago.
Users will no longer be required to visit a bank branch in order to open an account through their mobile devices. Carbon and FairMoney are two lending startups that are now able to provide users with almost instantaneous loans that do not require collateral. According to reports, in less than five years of operation, Kuda Bank has grown to approximately 1.4 million users, and the company has now been valued at $500 million following the completion of its Series B round of funding.
Business interactions with one another continue to be fraught with difficulties, despite the advancements made. Users who wish to transfer funds from their PiggyVest accounts to their Risevest accounts must do so through their financial institution, for example.
For a large number of businesses, the requirement to make value transfers between stores of value has been a source of disagreement. API startups such as Mono, OnePipe, and Okra have set the bar so far in the fintech industry, which has set the precedent. By utilizing an API provided by these startups, businesses can gain access to users' financial data across a variety of platforms and applications.
API is an abbreviation for Application Programming Interface, for those who are unfamiliar with the term. As a sort of software middleman, it facilitates the communication and exchange of information between businesses..
Let's pretend for a moment that you're looking to reserve a hotel room for a trip. Ideally, you would do so through the hotel's website, but what if you wanted to explore other possibilities? You would need to make use of a hotel reservation application.
You can make hotel reservations through these apps without having to go to the hotel's website first. It is thanks to an API that the hotel booking app is able to aggregate this information for you.
API fintech startups, as previously stated, are addressing this issue for financial institutions through their APIs. If you require this infrastructure but are not a member of the fintech industry, what options do you have? When Thepeer enters the picture, things get interesting.
Attempts are being made to address this issue by Thepeer, a startup that is developing infrastructure that will allow businesses to share data.
These companies share information on a wide range of topics, not just financial information. Described by Michael Okoh, co-founder and chief technology officer of Theeper, how the startup provides service to its customers: "Suppose a business wants to send money to another business; they go about their business, and all we do is inquire as to "which user are we tagging this transaction to?" When does this transaction take place and what is the context of the transaction? What is the total amount of money involved in this transaction? So, instead of providing context for data derived from the day-to-day operations of businesses, we simply provide context for data."
With the API provided by Thepeer, users can transfer funds directly from their PiggyVest wallets to their Risevest wallets, as shown in the previous example.
Thepeer can provide context for business-to-business transactions by providing these businesses with an API that they can integrate into their own platforms, according to the company. The startup collaborates with any business that accepts payments via a digital wallet, including restaurants and hotels.
For businesses, Thepeer provides a value proposition that is comparable. Consider the following scenario: if Jumia Food and Kuda Bank both integrated Thepeer's API into their respective platforms, Jumia Food could charge a user who had a Kuda Bank account without the user having to switch platforms. As a result, let's go back to the source of Thepeer's inspiration.
In the beginning
Chike Ononye, after completing his A-Levels in 2017, decided to take a year off to travel. As a result, he concluded that it would be prudent to pursue his childhood fascination with technology outside of the Nigerian educational system.
The reasoning behind this was that he would gain more hands-on experience than he would otherwise have gained in school. During a Laravel Conference that same year, he met Okoh, with whom he instantly clicked, their shared passion for technology serving as a unifying factor between them.
Later in the year, the two friends applied for and were accepted into the HNG Internship program, which was held in Hong Kong. Known as the HNG Internship, Hotels.ng, a hospitality startup founded by Mark Essien, offers a three-month internship program to qualified applicants.
There, interns — the majority of whom are newcomers — are introduced to the fundamentals of software development through weekly tasks that require them to demonstrate their newfound knowledge.
At the conclusion of each stage of the Internship, participants who do not meet the criteria specified at the beginning of each stage are removed from the program. Consider the concept of Big Brother, but applied to software development. After completing the internship, participants should have gained valuable skills that will enable them to obtain positions with the program's partner organizations after completing the program.
Ononye and Okoh were both accepted into the internship program and were placed in the same group for the duration of the program's duration. Working together on tasks enabled them to develop a shared understanding that is proving to be beneficial as they continue to develop Thepeer.
Following the internship, they worked with a variety of startups, including Softcom, Toptal, and Abeg, until Ononye came up with the idea for Thepeer in 2021, which they launched the following year.
"Trojan (Michael) is someone I've known since 2017. It just so happened that we were both on the HNG Internship program and were assigned to the same team! As a result, I had the impression that Trojan was the ideal person with whom to collaborate when I was trying to solve this problem. We had the idea months ago and decided to enlist the help of others to make it a reality "Ononye explains further.
Despite the fact that the startup claims to serve all types of businesses, they are focusing their efforts for the time being on fintech startups.
"Any business that has a wallet qualifies to become a customer of ours. Starting with fintechs was a good choice because, when it comes to wallets, they are typically the first point of contact "Ononye explains further.
Following a few months of development by a small team of four, Thepeer launched its beta program on April 26, 2021, with the goal of signing up a few businesses and evaluating the product's functionality. In response to feedback, the team made adjustments, and the site went live in August of 2021.
Although the startup is not a financial technology company, the majority of its customers are small to mid-sized financial technology companies. In addition, they are in the process of acquiring additional startups to expand their portfolio. Upon being questioned about the amount of money they had raised from investors, the startup declined to comment.
The process of starting a business in Nigeria can be difficult, even for the most courageous of businesspeople. Moreover, it is more difficult for startups in the fintech sector to achieve success because they must deal with regulatory bodies such as the Central Bank of Nigeria.
Startups in the financial technology sector have faced a variety of roadblocks, ranging from the February cryptocurrency ban to the freezing of accounts of companies suspected of facilitating or participating in cryptocurrency transactions. Although Thepeer has experienced similar difficulties, the co-founders have revealed that they spent the first few months obtaining all of the necessary licenses.
They must deal with customer data because of the nature of their business, and as a result, they have complied with the Nigerian Data Protection Regulation (NDPR).
Collaboration with Flutterwave
When they first launch, startups are frequently required to develop a number of features in order to be able to provide a variety of services to their customers, which can be expensive. New businesses may struggle to get their operations up and running due to a lack of resources, which is common in the startup world. A startup that has access to the API of a more established company can benefit from this, as it can help them get off to a strong start.
As a result, it's only natural that Thepeer was founded with the assistance of one of the most prominent startups on the continent. A partnership with fintech behemoth Flutterwave was formed as a result of the startup's exposure to a significant amount of financial data. However, that is not the only thing that Flutterwave has to offer them. The difficulties that new businesses face make Flutterwave an attractive acquisition candidate, as they can leverage their extensive experience and broad coverage to acquire additional businesses.
Thepeer will have access to Flutterwave's API, and the company will also benefit from Flutterwave's expertise in regulatory compliance, an area in which the young startup requires guidance. Earlier this year, Flutterwave announced that they had hired Oluwabankole Falade, a former MTN and Visa executive, to serve as their Chief Regulatory and Government Relations Officer (CRGRO). The appointment appeared to be a proactive move on the part of Flutterwave, given the high level of regulation that exists in the country's financial technology sector.
As a result, Thepeer operates in a regulatory gray area because of the type of service they provide. Even though they are currently working with fintech startups, they are not themselves a fintech startup, which could result in complications down the road. With Flutterwave's support, they should, on the other hand, be well-positioned to overcome any regulatory obstacles that they may encounter.
In spite of the fact that expansion plans are currently in the works, the founders' primary focus at this time is on Nigeria, where they hope to increase the value that the startup provides to businesses there. The team's passion, buy-in, and drive — all of which they hope to instill in future team members — Ononye believes will be critical to their success in the future.
