B2B eCommerce startup Tradedepot has raised $10 million from International Finance Corporation, Women Entrepreneurs Finance Initiative (We-Fi) and MSA Capital and Partech.
With this new investment the company plans to launch a suite of financial products and credit facilities to enable retailers on their platform to access the funds they need to buy more goods, scale their businesses and generate more revenue. The company also plans to explore expansion into other African cities.
Since its launch in 2016, TradeDepot has built a network of more than 40,000 micro retailers in Nigeria. Working with global distributors and manufacturers including Nestlé, Unilever, GB Foods and Danone, TradeDepot makes household supplies, such as milk, soap, detergent and other essentials more accessible and affordable for the informal urban retail networks it operates in. More than 75 percent of the retailers on TradeDepot’s platform are female.
CEO Onyekachi Izukanne, commented, “We are excited to strengthen our team and welcome on board some incredible strategic investors and partners, as we double down on our mission to digitize and simplify retail distribution for the continent. Africa’s offline retail market is estimated at $1 trillion, and this new investment allows us to capture an even greater segment of that market. We will continue to use data to drive efficiencies and provide an easier stock acquisition service for our 40,000+ retailers, driving down costs for them by negotiating even better deals with our global manufacturing partners, whilst simultaneously providing a better, faster route to market for our suppliers.”
Speaking for investors, Wale Ayeni, Head of Africa Venture Capital Investment at IFC added, “TradeDepot is a rising star in the African internet landscape, helping digitize a substantial underserved informal retail segment, which is the pillar of economic growth in Africa. The founders’ vision to build a digital platform that improves the unit economics of serving the mass-market is one that we feel privileged to support.”
Hanh Nam Nguyen, Program Manager, speaking on behalf of IFC as implementing partner of We-Fi, said, “Women play a pivotal role in driving economies across Africa, but lack of access to capital, limited market linkages, cultural norms and other challenges often prevent them from achieving the success they want. We-Fi financing will incentivize TradeDepot to build stronger women-led small and medium enterprises (SME) retailer and distributor networks, which will support them to become drivers of economic growth in their communities.”
Tidjane Dème, General Partner at Partech said, “we are proud to continue our partnership with TradeDepot as they continue their work to transform the huge informal markets that are present in Africa. The founders have a wealth of experience that puts them in a great position to execute on their vision, and their approach and results to-date are why we are so excited by the extraordinary entrepreneurs harnessing the power of technology to address issues across the continent.”
Ben Harburg, Managing Partner at MSA Capital said, “TradeDepot is leading the digitization of informal enterprise across West Africa at the most critical touch point – the distribution and sale of essential foodstuffs by SME retailers – driving efficiency improvements, increased service offerings, and costs savings to both consumers and merchants.”
Trade depot raising $10mil for its growth is the testament to the investor confidence in startups looking to formalize Africa’s over US500billion informal retail and wholesale market. Other startups in the space include Ghana MarketExpress and Kenyan Twiga Foods. The retail space remains highly informal with many small shops and inadequate data. COVID-19 and its related drive for social distancing and staying at home is predicted to drive many especially in the middle class to consider eCommerce for their retail or wholesale needs.