Nigerian company Cleva acquired $1.5 million in pre-seed investment to create a USD banking platform for African people and companies to accept foreign payments.
San Francisco-based early-stage venture capital company 1984 Ventures led the investment. The Raba Partnership, Byld Ventures, FirstCheck Africa, and angel investors also participated.
Aaron Michel, a partner at 1984 Ventures, supported Cleva’s creators, Tolu Alabi and Philip Abel, saying their software helps Africans negotiate hyperinflation, which has huge potential. The team’s expertise in creating financial products at Stripe and powerful systems at AWS makes them well-suited to handle this. He noted that the team’s early development shows its ability to perform in Africa and the U.S. 
As of this month, Cleva is part of Y Combinator’s winter 2024 batch, which included its pre-seed round. The famous accelerator has sponsored African firms like Grey Finance and Elevate (formerly Bloom) that allow freelancers and remote workers access to U.S. bank accounts for payments, savings, and currency conversion.
CEO Alabi told Eltrys why the site launched in August despite competition from Techstars-backed GeegPay and Payday.
First, she highlighted the ongoing difficulties Africans suffer in getting foreign payments for their talents and goods, a pain issue both founders uncovered via personal experience and significant study. They predict a $18 billion African market for remote worker and freelancer payment facilitation.
Another important issue is founder-market fit. African markets are important to both founders. After receiving college scholarships, they migrated from Nigeria to the U.S., where Abel attended MIT and Alabi attended Stanford Business School. They have technical and product expertise from Amazon, Stripe, AWS, and Twilio.
Alabi said, “Then there’s the market opportunity,” in an interview. “Our problem—enabling people to receive international payments—is neither Nigerian nor African. People in Latin America, Asia, and Canada need money for their jobs and services. Nigeria is our first market since we know it well and it’s large. We believe our backgrounds qualify us to tackle this worldwide issue.”
Cleva opened in Nigeria, letting users establish USD accounts with a bank verification number (BVN) and government-issued ID. Cleva only offers USD accounts, although other players provide GBP and EUR. The Delaware- and Lagos-based fintech has opened U.S. accounts for “thousands” of Nigerians, processed over $1 million in monthly payments, and grown 100% month-over-month income in four months, according to the CEO.
Alabi notes that fintech stands out in terms of customer experience and business approach. “We go above and beyond to give our customers a great experience. Customers gave us this comment. They know that emailing or contacting customer service won’t take a week or two, she said.
The YC-backed firm charges 0.9% on deposits into customers’ USD accounts and makes income when users switch and convert USD accounts for local currency (naira for now). Cleva restricts costs to $20, unlike rivals that charge 1% regardless of the amount.
In the interview, Cleva CTO Abel stated that it plans to launch USD cards and U.S. asset savings to diversify income sources. Cleva will soon target the African diaspora, having scaled through fintech difficulties including finding the proper banking partner and expertise. According to its website, additional forthcoming capabilities include the ability to make professional invoices and transfer USD worldwide, joining a competitive remittance area with Flutterwave’s Transfer, Chipper Cash, Lemfi, and Afriex.
Overall, fintechs targeting freelancers and the African diaspora are primed for continued development. A globalizing world drives young Africans to upskill and export their abilities to fulfill the need for qualified workers. “Long term, we are open to Cleva evolving from just being a product-only service to being a platform issuing APIs to do a bunch of other things that help us distribute services across other African countries or around the world,” Abel added.
