Could there be a better story for 2020? A startup from Little Rock, Arkansas, founded by West African immigrants, tackling a huge and important problem, managing the global banking & money transfers for NGOs. The company says that an estimated 30% of the $150B in annual aid ($70B of that originates in the USA) is squandered due to inefficiencies, fraud (estimated at 5%) and mismanagement. That's $50B that could go a long way to improving the lives of millions more.
In its pitch (above), AidBanc outlines how World Vision has 2,000 bank accounts with more than 200 financial institutions in 100 countries. The company says its single interface not only simplifies account management, it will handle payments and transfers into all those countries eliminating the need for clients to maintain in-country accounts.
I first heard AidBanc's pitch last week at the Techstars/Western Union demo day, and I knew right away we had our Startup of the Week. Founder Maf Sonko is a second-time founder and it shows. Previously, he founded cross-border payment specialist LumoXchange which closed down in early 2020 when it failed to attract sufficient new investment. LumoXchange participated in the FIS accelerator in 2016 (see Demo Day pitch below) and raised $550k (per Crunchbase). Sonko says there is no connection between the two startups, although his domain expertise in foreign exchange will be important as AidBank gears up.
AidBanc, which officially launched just 9 months ago (though it was formed in late 2018 according to Linkedin), has already signed LOIs (letter of intent) with 3 non-profits (including Winrock International, per “Innovate Arkansas” interview below) with a combined $80M in aid flow. And it has another $87M worth of potential volume in the pipeline. That's already 1% of the global NGO aid flow well before its official product launch.
Founder Sonko told us that they are busy building out the platform on top of several BaaS providers and are negotiating with a number of payments providers for the all-important money-movement piece (obviously that startup just graduated from a Western Union-sponsored accelerator, so they are likely a leading candidate). The company expects to be live with its 3 customers in the Spring of 2021 and hopes to raise a seed round around the same time (so far the company raised just $120k from Techstars).
Description: Full-service banking and spend management platform for global NGOs.
HQ: Little Rock, Arkansas
Founded: Dec 2018 (per Linkedin)
– LOIs with 3 major non-profits
– $80M of aid payments already committed
– Another $87M in pipeline
– 1% global market share BEFORE full launch
- Demo: 5-minute demo of AidBanc prototype (26 April 2020) https://www.loom.com/share/c330b582fd6b4e268da6b4dc25d0b6b7
2. Interview: 25-minutes with Innovate Arkansas (4 June 2020)
3. LumoXchange 10-min pitch at FIS VCFinTech Demo Day (Aug 2016)