iProcure, a Kenyan B2B agritech that connects agricultural manufacturers and distributors to local retailers has secured$10.2 million in series B funding.
The latest round includes $1.2 million debt, and was led by Investisseurs & Partenaires (I&P), the funding brings the total funding raised by iProcure to $17.2 million. Novastar Ventures, Ceniarth and British International Investment (BII), which recently took part in Apollo Agriculture’s $40 million Series B fundraising, also participated in the round..
According to the company, the funding will be utilised to grow its presence in Kenya and Uganda, which are its current markets, and to expand into Tanzania.
“We have built out a Pan-African distribution infrastructure, and we are using these funds to scale our operations in our two markets and to enter Tanzania. We’re also going to be allocating some of the resources toward introducing higher-quality cheaper products that we are sourcing from international players,” said iProcure co-founder and chief data and growth officer, Stefano Carcoforo.
Founded in 2012 by Stefano Carcoforo and Nicole Galletta, the platform aims to facilitate and encourage local procurement, in Kenya, by providing a secure and functional platform where businesses and Institutional buyers can connect to and source goods and services from a base of reliable pre-screened vendors.
The agtech provides the agro-dealers with an end-to-end enterprise resource planning (ERP) system that operates from mobile devices, helping them manage their sourcing and distribution.
This technology has introduced new efficiencies that control the penetration of substandard supplies as retailers are able to source directly from certified manufacturers and distributors. By helping manage stock-outs, the agtech ultimately helps stabilize product prices for the benefit of both the sellers and end users.
The platform currently connects 5,000 agro-dealers to different manufacturers but this number is set to grow as it onboards more partners and retailers across the three markets and as it doubles its distribution hubs to 20, boosting its last-mile delivery.
Agro-dealers are the focal point for suppliers hoping to introduce new products into Kenya’s input markets, as they are trusted by millions of farmers to be sources of sound agricultural advice. They are also well spread across the country, giving them a broad coverage of farmer communities. Through agro-dealers, iProcure targets to double the reach of farmers to 2 million in the next one year.
“The agro-dealers use our technology to keep track of their sales, process sales, to manage inventory, to place orders and build CRMs that can help deploy loyalty programs to the farmers. It does everything they need. We provide a completely transparent system from the factory all the way down to the point when the farmer purchases the product,” said Carcoforo.
For added reach, iProcure plans to extend zero-interest credit to agro-dealers, increasing their ability to purchase the hardware required to use its ERP system. By plugging in more retailers to its system, iProcure will additionally get access to data required to inform its growth strategy, including a buy now, pay later (BNPL) service currently in the pipeline.
“Work capital is an issue facing these retailers, and we’ve demonstrated that if we provide supplies on a BNPL model, retailers buy 30% more. This shows that retailers themselves are cash constrained and can’t buy all the inventory they can sell; meaning that farmers aren’t able to access all the inputs they need. The BNPL service we are introducing will sort this problem,” said Varia.
According to Varia, iProcure has grown 16x over the last four years, doubling its revenue every year, except for 2020 due to COVID. In the short term, he expects further expansion through the onboarding of more retailers and the introduction of the BNPL offering