Bamboo, a Nigerian platform that gives people access to more than 3,000 US-listed stocks has raised $15 million in a Series A round co-led by Tiger Global and Greycroft.
Bamboo was founded in 2020 by Richmond Bassey and Yanmo Omorogbe and has had impressive growth since it first appeared. The platform makes saving and investing in stocks, bonds, etc., very easy and convenient. Bamboo has witnessed tremendous growth for quite a handful of reasons but one important one is it helping Nigerians to protect themselves against the effects of the devaluation of the naira and inflation by providing them with a means to invest in the highly-revered US stocks. Through its partnership with Drive Wealth LLC, Nigerians can access stocks on time and do not need to open a brokerage account or the services of a broker. Bamboo makes the whole process of investing in stock easily. According to CEO Richmond Bassey “What we essentially want to do is to make investing in the global stock market easy for Africans. In accessing investment options, especially in capital markets, both locally and globally, we want to make that easy for Africans because we’re driven to help Africans create and preserve wealth by owning shares in the world’s most successful companies”.
Bamboo currently boasts of over 3,000 users. Out of that number, about 20 percent are active daily traders and 75 percent of that figure never traded stocks before using the platform. The company said that in 2021, repeat depositors made up 85 percent of deposits on the Bamboo platform. These users are charged a commission of 1.5% per transaction and about ₦45 (~$0.1) to $45 withdrawals for users with naira or dollar bank accounts, respectively.
Like other companies and/or startups, Bamboo faces competition from fast-rising companies. In its category, its competition includes Rise, Trove and Chaka.
Between 2020 and now has not been a smooth ride for Bamboo as it has had to deal with regulatory scrutinizes. For example, Nigeria’s Securities and Exchange Commission declared the activities of Bamboo and other investment firms as illegal in April. The body warned capital market operators to desist from working with these firms.
Fast forward to August, Nigeria’s Apex Bank made allegations that Bamboo and other investment firms were operating as asset management companies without acquiring a license. The allegations also claimed that these firms were “utilizing F.X. sourced from the Nigerian F.X. market for purchasing foreign bonds/shares”.
Eventually, a court order was given and mandated that the accounts of these investment companies be frozen until the central bank determined what to do after investigating. Although the company has received a court order for its accounts to be unfrozen, it is still quite unclear as to where the company stands in the SEC’s directive but CEO Richmond Bassey strongly believes that “Stocks and selling stocks is a regulated business and currently, we are only live in Nigeria. Working very closely with regulators in Nigeria, we have to work within the ambit of what they are comfortable with and what they allow. That’s the extent to which we are offering our services. Perhaps if we launched in other markets and regulators there have a different relationship with a certain asset class, we would also work within the ambit of what they are comfortable with”.
Bamboo also plans to list Nigerian stocks before the second quarter of this year and is waiting for regulatory approval to do so. Bamboo has also announced its expansion to Ghana and says that over 50,000 people have joined its waitlist. It is also looking to venture into Kenya and South Africa in the future.
Bamboo will be investing part of the acquired funds in its tech infrastructure to enable faster processes and withdrawals. It also says that will introduce new offerings to its B2B line that’ll allow asset managers and fintech companies to be able to integrate Bamboo into their offerings.
The funding round also saw participation from Motley Fool Ventures, Saison Capital, Chrysalis Capital and Y-Combinator CEO Michael Seibel.