Nigerian startup Startbutton is a “merchant of record” that enables businesses to accept payments in local currencies and manage local compliance without needing to establish local offices.
Co-founded by Mallick Bolakale and Kelechi Obi in 2022, Startbutton assists multinational businesses in accepting local currency payments across Africa, and settling them in foreign currencies like USD, at the rate prevailing at the time of collection. This aids in managing treasury, foreign exchange, and settlement risks.
“We also provide a “compliance as a service” feature, which automates VAT collection for merchants. This allows them to charge taxes to their customers and remit it to the relevant tax authorities,” said Bolakale.
In fact, with a single API from Startbutton, merchants can accept payments in five local African currencies and receive settlements in USD. It also offers regulatory coverage for entities requiring a local license to operate in new markets.
“A primary reason why companies expand to other countries is because they want to sell more and unlock new revenue streams. Traditionally, say a Nigerian company wants to expand to Kenya, they have to consider a lot of things – registering a local entity, opening a local bank account, setting up a payment system that allows them to receive payments in shillings and convert it to naira…” said Bolakale.
“After all of this is done, the company has to ensure that it’s tax compliant – regularly filing its necessary tax. Supposing sales start picking up and the company decides to hire a Kenyan employee, it ideally has to pay the employee in shillings and also pay necessary employee tax requirements. Even when the company has all of this on lockdown, a single change in regulations could make the once-compliant company become a defaulter and incur significant sanctions.”
Startbutton aims to solve all these problems, and is already active in five African markets – South Africa, Rwanda, Nigeria, Kenya, Ghana.
“We’ve partnered with payment companies like Paystack and Cellulant to start merchant expansion programmes,” said Bolakale.
“We onboarded our first merchant directly on the platform on launch day. After the merchant expressed a pain point on Twitter, we reached out to solve it immediately. Since then, we’ve continued to support the merchant’s expansion across Africa. We’ve onboarded over 50 enterprise merchants.”
Bootstrapped until it launched its product and began onboarding customers, it raised an angel round worth over US$250,000 last year from investors like Norrsken, Musha Ventures, and Africa Fintech Collective. It plans to raise an extension round this year, and expand to more markets.
“Plans are underway to launch in Tanzania, Uganda, and Cote Ivory Coast before the end of the first quarter. Additionally, we aim to commence operations in North Africa before the year ends,” said Bolakale.
Startbutton takes commission from collections and settlements made by its customers, and also charges a recurring fee for other services such as compliance and taxes.
