Why we invested in Ejara
Crypto volumes on exchanges globally have soared with over $1.5 trillion traded on major exchanges as of June 2021. Sub-Saharan Africa is no different with rapidly growing volumes over the past 12 months. The big three markets (Nigeria, Kenya and South Africa) had $670m traded across the last year on major P2P exchanges — Paxful and LocalBitcoins- alone. Meanwhile, the Francophone region remains largely untapped with the majority of transactions happening through Whatsapp and Telegram groups, despite being the most crypto-friendly market in the African eco-system. This process is not frictionless as a user is relying on luck and skill as crypto traders have to manually find counterparties willing to take on the currency (fiat or crypto) that they hold. This leads to a strain on liquidity and crypto holders exchanging for fiat do so at a premium. This is further compounded by the lack of reliable crypto to fiat liquidity providers for the CFA Franc in the region. These structural limitations make the customer journey tedious and cumbersome. Despite the constraints, the market is growing rapidly. Volumes on Paxful and LocalBitcoins grew 107% across the last 6 months when compared to the preceding six months
The friction caused by status quo is what excites us about our latest investment: Ejara. Ejara is democratizing investment in financial assets through a fiat on-ramp solution aimed at the largest untapped African market. This will lower the cost to transact and trade and improve liquidity in one of the most crypto-friendly regulatory environments on the continent. In addition to a crypto exchange, Ejara aims to cater to all savings and investment needs of the population by providing investment opportunities in U.S. stocks as well as through DeFi products that will be launched on the platform in the near future. This represents a huge opportunity to improve financial inclusion in a continent with the lowest rates of financial inclusion, as well as help educate the population in wealth creation.
Our conviction was augmented by the management team led by Nelly Chatue Diop. A computer science engineer by background who received an MBA from HEC Paris. Nelly worked with Accenture before gaining startup experience with Booper (a big data solution for retailers in France) and blockchain/crypto experience as a Co-Founder at Nzinghaa Lab and as President of the Tezos West African foundation. Co-Founder Bapstise Andrieux has previously spent his career building businesses in visual effects production and founded the visual effects company, EightVFX, which has served the likes of Wells Fargo, Netflix and Amazon.
At Lateral, we want to back talented founders filling critical digital gaps in the economy. With Ejara, we see an opportunity to help create wealth for users in Francophone Africa.
