Fundamo, a mobile financial services (MFS) provider, has trebled its turnover since 2007 when Here Be Dragons (HBD) became one of several investors to secure a stake in the company with a venture capital investment worth R36-million.

The company was established in 2000 to facilitate financially disempowered consumers’ access to electronic payment mechanisms through the burgeoning mobile banking market and used HBD’s and other investments to implement its plan for aggressive expansion in the market.

“The market penetration of mobile services is increasing rapidly,” says Van Rensburg. “In 1990, there were 11 million mobile subscribers. Fewer than 20 years later, in 2008, there were three billion and counting. Growth is very impressive in developing economies where formal essential financial services – such as affordable and convenient money transfer – may be lacking. Sending small amounts by bank transfers and specialist remittance services can be prohibitively expensive for consumers because of the built-in cost of physical and distribution infrastructure as well as cash handling fees. Our services allow migrant workers, for example, to send money back to their families via their cellphone handsets, safely and easily.”

He explains that MFS channels have four key elements that make them popular. These are: intimacy, ubiquity, immediacy and utility. The global industry is segmented into m-banking, m-payments and m-commerce.

Fundamo mainly provides enterprise solutions in the m-payments and m-banking segments. M-banking involves applying Internet banking tools to mobile devices for services such as balance checking, bill payments, customer services and fund transfers. M-payments, on the other hand, are new innovations to facilitate payments and transactions such as online wallets, domestic transfers, cross-border remittance, proximity payments and remote payments.

Julia Fourie, CEO of HBD, says that Fundamo was a ‘slightly unusual’ investment for the VC firm to make.
”It was typical of a company that was a little ahead of its time but came to us with a strong track record and the need to expand into other global markets.”

One highlight for Fundamo has been the signing of MTN to roll out its technology throughout the MTN group, in addition to creating customised products and services for other MNOs (mobile network operators). Future strategic developments include the establishment of global partnerships to ensure that Fundamo remains an industry leader and increases its market share.