NIGERIA –  Brass, a Nigerian digital banking startup, has been acquired by a consortium led by fintech Paystack to alleviate liquidity concerns and avoid closure.

The consortium, which includes Piggytech, Ventures Platform, and P1 Ventures, will now take on the startup’s assets and liabilities, with Akindolu and Okeke leaving the business.

Launched in July 2020 by Sola Akindolu and Emmanuel Okeke, Brass equips SMEs with a full-stack, commercial-grade banking service across various business classes. This enables them to gain greater clarity and control over their money operations and the power to scale their enterprises. 

Like other startups, Brass has been affected by global economic headwinds and faced liquidity challenges that forced it to take on debt financing to process customer withdrawals. 

Over the years, we have added and supported tens of thousands of businesses with top-end financial tools for local businesses, and we are just getting started. We have also had the incredible opportunity to build with some of the most brilliant and talented people we know,” said Akindolu.

“Brass has grown tremendously since we started this incredible journey, and it continues to be an important player in Nigeria’s SMB economy.” 

“Following the acquisition, Brass will continue to build and support its customers and grow with a new leadership team, as the founding leadership team will leave to pursue other opportunities. Making entrepreneurship permission-less is far from finished, and we look forward to what’s next from the new team.”

Amandine Lobelle, Paystack’s COO, said Brass and Paystack have had a long working relationship since Brass’s founding. 

We’re thrilled today to announce a new chapter in our partnership,” she said. “Each member of the investment group brings several years’ worth of experience financing and building reliable financial service products, and together with a new infusion of capital, we’re excited for Brass’ next growth stage.”

The Paystack-led acquisition comes three months after Brass was unable to give customers access to their deposits, blaming a funding freeze and the country’s economic situation. Before then, it had raised more than US$2 million from investors.

The company received a fresh capital injection in March 2024, which allowed it to process withdrawals for affected businesses.

The acquisition allows Paystack and PiggyVest to gain a foothold in a business that complements their operations. 

While PiggyVest has traditionally focused on consumer finance, its acquisition of Pocket (formerly Abeg) saw it delve into the social payments segment. Paystack has built payment tools for businesses across Africa and potentially provides a customer pipeline for Brass.

Brass is expected to get new leadership as its founders exit, but no announcement has been made. In the meantime, Brass new leadership will have to rebuild customer trust after a few months of trying for the four-year-old startup.

Per TechCabal, the company reportedly has ₦2 billion (US$1.42M) in debt on its balance sheet, which its leadership cannot account for. While the acquisition means new business for Paystack and Piggytech, there could be more liabilities to take on than assets.

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