E-commerce startup Sokowatch raises US$125m series B funding, rebrands to Wasoko

KENYA – African start-up Sokowatch, an online supplier of goods to micro retailers, has closed a US$125 million Series B funding round.

The latest round of funding was led by Tiger Global, the world’s largest venture capital firm and Avenir Growth Capital, to enable the e-commerce to expand across the region.

The round also saw participation from a host of leading names including VNV Global, Binny Bansal (co-founder of Flipkart) and Sujeet Kumar (co-founder of Udaan), as well as existing investors Quona Capital, 4DX Ventures and JAM Fund.         

Alongside the new Series B funding, Sokowatch has also officially launched in Abidjan, Côte d’Ivoire and Dakar, Senegal, the company’s first locations in West Africa.

The startup which has created a platform that connects merchants directly to local and multinational suppliers has also rebranded to Wasoko, which translates to “People of the Market” in Swahili, marking its next growth phase of moving from an East African player to a pan-African one.

“Sokowatch started as this kind of backend brand. We wanted a brand that could be more front and center for the African retailer and easily pronounced across all markets while reflecting our East African roots.

“So that’s why we’ve rebranded now to Wasoko, meaning ‘people of the market,” said Daniel Yu, Global CEO and Founder of Wasoko.

Initially launched in 2015 in Kenya, Wasoko has delivered 2.5 million orders to over 50,000 informal retailers across Kenya, Tanzania, Rwanda, Uganda, Côte d’Ivoire, and Senegal with revenue growth over the past 12 months at over 500%.

The company is exploring expansion into Nigeria and Southern Africa, while continuing to consolidate its market-leading position across its six current countries.

Wasoko is also examining opportunities to expand its product offering to verticals such as merchant point-of-sales systems, bill payments, and social commerce through both internal innovation as well as strategic investments and acquisitions of relevant companies.

“After more than six years building and constantly iterating on our operations, we are proud to have demonstrated the traction and quality of business required to raise funding from world-class investors.

“We’re fully focused on leveraging their strategic support to build one of the biggest e-commerce companies in the world and transform access to goods and services for African citizens across every corner of the continent,” said Daniel Yu.

Wasoko set to take over the region

Over US$600 billion of consumer goods are sold in Africa through informal retail channels every year, supplying the vast majority of the population.

Despite the importance of the informal retail sector, the industry still remains highly fragmented and inefficient with local shops facing a number of major challenges including frequent stockouts, limited access to capital, and difficulty receiving goods from suppliers.

Through Wasoko’s platform, informal retailers are able to order products at any time via SMS or mobile app for free same-day delivery to their stores.

Leveraging historic purchasing data, the platform also evaluates retailers to provide them with access to Buy Now Pay Later financing.

As Wasoko continues to strengthen its presence across Africa, other leading players in the sector are also consolidating their efforts i.e., TradeDepot and MarketForce, an asset-light platform present in Kenya, Nigeria, Uganda, Tanzania and Rwanda.

TradeDepot, on the other hand, operates an asset-heavy model across Nigeria, Ghana and South Africa.

What they both have in common is a presence in Nigeria, arguably the largest market for informal retail in Africa.

And though no B2B retail e-commerce player has a monopoly on the Nigerian market, it’s more saturated than other markets based on the numerous players vying to digitize the country’s informal supply chain — from Sabi to Omnibiz and Alerzo.

Therefore, less competitive markets like Ivory Coast and Senegal present an enormous opportunity for Wasoko, but the with its shinny new identity, the startup also wants a piece of the Nigerian pie among other markets.

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