Zone, a Nigerian blockchain startup, has successfully raised $8.5 million in its first venture capital funding round. This is a significant achievement for the company, which became independent from its parent company, Appzone, in 2022.
Flourish Ventures and TLcom Capital, a UK-based firm led the funding round. Other contributors included international venture capital firms with a focus on blockchain technology, such as Digital Currency Group, Verod-Kepple Africa Ventures, and Alter Global.
Obi Emetarom, CEO and co-founder of Zone stated that the initial funding was provided by the parent company. However, after becoming an independent entity, it was necessary to secure additional funding to support continued growth.
Zone operates Africa’s first regulated blockchain network for payments. The new funding will be used to expand its network within Nigeria and establish connections with more banks and financial services companies. Zone’s blockchain network facilitates direct transactions between financial service providers, eliminating the need for intermediaries. It also automates processes such as settlement, reconciliation, and dispute management.
Over 15 of Africa’s largest banks and fintech companies use Zone’s network to process payments. This includes Access Bank Plc, Guaranty Trust Bank Plc, and United Bank of Africa, three of Nigeria’s largest banks.
Ameya Upadhyay, a partner at Flourish Ventures, expressed optimism about the potential of Zone’s technology to advance payment innovation on a global scale.
Zone plans to enhance its technology, particularly in the area of instant settlements, and develop more use cases for its blockchain network. Emetarom clarified that Zone is developing an API that banks, fintechs, and other financial service providers can integrate into their payment applications, rather than an interface for end users.
Despite a challenging fundraising environment, Zone secured funding from high-quality investors. Emetarom views this as a testament to the trust in the Zone brand and credits the uniqueness of its product and the experience of its founders as key selling points to investors.
Zone has plans to extend its blockchain network across Africa. A portion of the new funding will be used to conduct a comprehensive pilot program to test its cross-border capabilities, to launch a remittance product in 2025. However, Emetarom emphasized that the company’s immediate focus is on building out its domestic capabilities in terms of technology and use cases.
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