MarketForce, a Kenyan B2B retail distribution platform has raised $2 million Pre-Series A round to launch to launch in Nigeria and to scale up RejaReja to more towns in East Africa.
The funding was raised from V8 Capital, Future Africa, Greenhouse Capital, Launch Africa, Rebel Fund, Remapped Ventures, and a couple of strategic angel investors as new investors. Y Combinator and existing investor P1 Ventures also participated in the oversubscribed round. Todays raise brings MarketForce’s total funding to-date to $2.5 million after it raised $350,000 seed round last year and $150,000 from Y Combinator.
According to Tesh Mbaabu, Cofounder and CEO of MarketForce, “We are seeing significant demand for our radically improved way for companies to distribute their goods and services in Africa, and we’re thrilled to get a boost from returning and new investors at this crucial time. The combination of our technology with the offline distribution network that we are building is essential to creating maximum output and impact in African retail distribution. Our goal is to create income growth opportunities for a million retailers and independent sales agents across Africa within the next five years.”
Last month, MarketForce acquired Digiduka, which was formed and funded during the inaugural cohort of the Antler programme in Nairobi. The acquisition aided in its growth of RejaReja which now provides a wallet that allows retailers to collect mobile money and bank payments via mobile app, WhatsApp bot or USSD shortcode, eliminating the high mobile money transaction fees and enabling merchants accept digital payments, access working credit and earn more by acting as distribution agents for popular financial services such as airtime, bills, utilities, and even insurance.
“RejaReja”, slang for informal aims to digitize the supply chain processes of informal retail merchants who buy and sell FMCGs and digital financial services. The new platform helps these dukas or corner shops to get better service, assortment, and access to new revenue opportunities, outfitting them with the technology and support they need to transform themselves from simple FMCG outlets to comprehensive financial service hubs for the continent’s last-mile communities. Currently available in Kenya, RejaReja offers informal retailers next-day delivery for hundreds of SKUs from the leading FMCG brands.
TradeDepot will also use the funds to expand into other African cities and launch a suite of financial products and credit facilities, to support its retailers.
“Our clients and partners understand MarketForce’s power to increase sales performance and productivity across markets and industries,” said Cofounder and CTO Mesongo. “We are building the operating system for retail distribution in Africa, and we have the right combination of technology and team to make our Pan-African vision a reality.”
MarketForce clients are able to gain access to both MarketForce software and the RejaReja marketplace, which has garnered over 15,000 retail customers, processing thousands of orders daily, and we are experiencing double digit revenue growth month over month. The MarketForce SaaS product on the other hand has garnered over 10,000 monthly active users, with over 300,000 transactions worth over 500 Million USD processed to date through the platform in 3 key markets; Kenya, Uganda and Tanzania. Clients and partners include Safaricom, Pepsi, Grain Industries, Fort Beverages, Madison Insurance, Platinum Credit, Momentum Credit, Letshego, Pezesha and Lami.
“We are glad to be backing MarketForce in this round of funding, given their ability to build a differentiated, powerful and all-inclusive digital commerce platform for informal retailers in Africa. Similar to Paystack, another successful African YC company who targets merchants selling online, RejaReja targets the millions of underserved informal merchants who are still offline when it comes to business automation and payments,” said Tobi Oke, Managing Partner at V8 Capital Partners.
In sub-Saharan Africa, approximately 90% of household retail transactions are in cash, and delivered through a network of about 100 million MSMEs, with 42 million in Nigeria alone. Retail payments on the continent are expected to top $2.1 trillion by 2025, and MarketForce aims to digitize a large portion of these offline transactions.
“We are proud to back MarketForce to build the future of retail in Africa and help catalyze the digitization of the African retail market, which is highly informal, fragmented and undigitized, but holds a lot of untapped potential to improve incomes and enable millions of African retailers to grow their businesses. MarketForce sits in a place that enables them to generate a lot of value and empower every single participant in the massive retail industry,” said Adenike Sheriff, Principal at Future Africa.
MarketForce is one of the fastest-growing African leaders in sales and distribution automation technology. We’ve witnessed the pain point that MarketForce’s product addresses and how its customers realize major productivity gains over substitutes.
“I have known Mesongo and Tesh for over two years and MarketForce has proven that they know how to leverage the entire retail supply chain as a gateway for digital payments. Their organic as well as acquisition-driven growth & expansion strategy thus far has proven that their understanding of unit economics and marginal customer acquisition costs is solid. As a pan-African fintech company, they are very well positioned to tap into the $700 billion that gets transacted in this space every year,” said Zachariah George, Managing Partner at Launch Africa.