Building trust in new markets and other lessons from expanding to South Africa
How Paystack thinks about scaling geographically across Africa as a high growth startup

In May 2021, Paystack officially launched in South Africa. Almost exactly one year later, thousands of ambitious businesses across South Africa use Paystack to get paid online.
The Paystack South Africa team has also grown from a handful of people to over thirty Stacks across engineering, product, customer support, sales, and more, eager to power growth for businesses of all sizes, from early-stage startups, to mature enterprises.
As the year ramps up, you might be thinking of your next steps as a startup, and international expansion might be one of your strategic priorities. How do you identify and prioritize new markets? How can high growth startups build trust with prospective customers in new regions? What are some common missteps to avoid?
As Paystack’s South Africa Country Lead, I’ve spent a fair amount of time thinking through expansion strategy, and in this short article, I aim to distill some of the lessons we’ve learned in the process of serving South African businesses with Paystack’s suite of payment tools.
Design a prioritization framework for new markets
With 54 countries on the continent, we consider several factors when deciding which country to expand to next. Every company’s prioritization framework will be different, influenced by your goals, positioning, product, and more.
Paystack’s prioritization framework is led by an internal Expansions team, and it includes studying each country’s existing payments landscape, and figuring out whether Paystack’s products can meaningfully serve the unmet needs of businesses who are already accomplishing great things in that market.
In South Africa, for example, we found a growing startup ecosystem (South Africa was top four in funding for startups in Africa in 2021), which excited us because we’ve invested heavily in building a complete API suite that allows startups to build beautiful payments experiences.
We also found a strong and growing ecommerce market (online sales in South Africa grew by 66% from 2019 to 2020) which we were also excited to see because we’ve built a deep bench of business solutions for ecommerce brands, including several plugins for platforms like Shopify, Wix, and BigCommerce, as well as no-code solutions such as Paystack Storefronts for merchants who have simpler needs.
Another factor we consider is how much inbound interest we’ve already received from merchants in that country.
Businesses across Africa can indicate an interest in knowing when Paystack launches in their country by entering their information on this page.

When we looked at the data, we found that many of those responses came from merchants in South Africa. This further strengthened the argument to prioritize South Africa.
Those were some of the signals we weighed heavily in our prioritization framework, and as we continue to expand, our framework will evolve as we gain a better understanding of which signals correlate most strongly with success.
Your own framework might look different, and that’s okay. Start simple. Ask yourself “What 3 to 5 things must be true in this market for us to have the highest likelihood of success?” and evaluate each country against that rubric. You can evolve your framework as you learn more, but it’s important to document your framework, and evaluate new markets rigorously against that checklist.
Actively speak to all stakeholders who might influence your success
Each market is unique, so you need to actively speak to the people and organizations who are already in-market to get a clear picture of the opportunities, and to build trust and meaningful relationships.
We met with several developers, banks, startups, agencies, entrepreneurs, and other knowledgeable folks during our pilot to understand their biggest pain points.

Speaking to prospective merchants gave us a deeper understanding of the needs of different merchant categories. These conversations revealed more about the competitive landscape that desk research alone did not show. We also discovered important ways that we needed to localize our product in order to meet the needs of South African businesses.
Speaking to regulators was also critical. It’s difficult to underscore how important it is to build a relationship with the regulator within your industry, not only to understand the full scope of your responsibilities as a regulated entity, but also to understand the regulator’s vision for the country, so that you can operate in lockstep with them.
And while tools like Zoom and email are extremely efficient, the truth is that the business of building trust often happens in person. Plan to have members of your team on the ground as much as possible to help your prospective partners and customers put a face to a name.
Be prepared to localize the product to meet local needs
We quickly discovered that we needed to make a few changes to our product to better serve merchants in South Africa. Showing a commitment to providing customers with products that suit their needs is a great way to build trust, and just makes good business sense.
For example, we integrated with popular local payment options like SnapScan. At launch, merchants could accept payments from cards (Visa, Mastercard, American Express), EFT, and Masterpass, but we added Snapscan shortly after, giving our merchants’ customers yet another familiar and potentially more convenient payment option.

Another localization we made involved Value Added Tax (VAT). VAT exclusive pricing has become the norm for payments in South Africa, but our initial pricing was VAT inclusive, which confused merchants. They assumed we’d charge them VAT on top of our pricing. Eventually, we updated how we handled VAT in line with the common expectation of pricing being VAT exclusive.
Yet another insight was around international payments. We soon realized that our default rules around which merchants could accept international payments were too stringent for South Africa, where the large number of tourists and expatriates means that the average merchant is going to receive a higher than usual number of payments on foreign-issued cards. With this in mind, it’s become a priority to expand the range of global payment methods available to South African merchants to make international payments seamless.
Sell more online
Paystack has all the payment tools you need to start and scale your business.
Create your free accountBe ready to build a team on the ground
As we grow in South Africa, it’s become essential to localize operations by hiring on the ground. This is one key thing we’ve learned from engaging with businesses in South Africa: building out your presence with local hires in the new market helps build trust.
In the early days, internal team members handled different crucial functions such as determining the product pipeline and setting realistic timeframes to drive development, keeping a finger on the pulse of our merchants, and as we mentioned earlier in the article, engaging with banks and regulators.
Today, we’ve hired team members to fill some of these roles and we’re still on the lookout for more team members to help serve businesses in South Africa. If you’re excited about the challenge of accelerating commerce across the continent, check out these roles with Paystack!

And we’re just getting started
One year after launch, we're excited by our progress and by the further growth ahead.
In 2021 alone, the amount of revenue that Paystack helped businesses in South Africa collect grew between 35-50% month-on-month, and we're currently doing over 10 times the number of transactions per week than we did last year. But we're just getting started.
You can expect to see Paystack in more community events over the next few months. Two weeks ago, we were at DevConf 2022 in Johannesburg and Cape Town where we got to meet with and learn from software developers in South Africa. We look forward to meeting with you at future events and learning more about how we can help your business grow.

Sell more online
Paystack has all the payment tools you need to start and scale your business.
Create your free accountMeet the Paystack South Africa team!
We hope this short dive into what we’re learning in South Africa has been helpful as you consider expansion into new markets.
To learn more about Paystack in South Africa, join us on Tuesday, May 10, 2022, for a short live Q&A on our plans for 2022 and more tips on expanding to a new market. Book your free seat here! ✨