Paystack and PiggyVest have joined forces with other investors to acquire Brass, a struggling Nigerian digital bank for small businesses. The acquisition comes after Brass disabled customer withdrawals for months due to a funding freeze.
The investor group acquiring Brass also includes Ventures Platform, P1 Ventures, and angel investors Olumide Soyombo and Oo Nwoye. While the terms were not disclosed, the deal will provide a capital injection for Brass and install new leadership as co-founders Sola Akindolu and Emmanuel Okeke exit the company.
“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,” said Akindolu. A statement from Paystack highlighted the group’s “experience financing and building reliable financial service products.”
For Paystack and PiggyVest, the acquisition allows them to expand into banking services complementing their existing payment and finance offerings. PiggyVest’s recent Pocket acquisition brought social payments capabilities, while Paystack provides payment tools for African businesses.
However, the deal may also inherit significant liabilities. Reports indicate Brass had over $2 million in unexplained debt on its balance sheet amid its withdrawal issues. Rebuilding customer trust will be a key priority for the new investors and leadership.
Despite the challenges, the acquisition positions the Paystack-led group to create an integrated financial services platform spanning payments, banking, savings and more for businesses and consumers across Africa. With fresh capital and an experienced investment team, Brass may get a second chance to deliver on its digital banking promise.
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