Kenyan e-commerce marketplace AfricaSokoni has so far banked US$995,000 in total funding as it plans expansion both within and outside Africa.
Launched in January 2018, AfricaSokoni is an online marketplace that brings African consumers and retailers together, offering a wide selection of products.
“Our goal from the onset was to bring shopping to the doorsteps of the African consumer and to build a platform that promotes African businesses and products to the outside world,” the startup’s chief executive officer (CEO) Ebrima Fatty told Disrupt Africa.
“We started by selling to the mass market, B2C, just like most online platforms in Africa. We then moved on to implement the B2B component of our business model.”
Fatty speaks of a “next phase”, which he will not reveal details of, which will see AfricaSokoni introduce a “unique model entirely new to the African e-commerce ecosystem”. With that in mind, the startup has been on the fundraising trail.
AfricaSokoni raised US$150,000 in pre-seed funding, and has had a seed round open since last year that has so far banked US$845,000 more. It hopes to increase this figure to US$1.5 million by the time the round ends in June.
“We are funded mainly from angel Investment sources. As and when we judge that the time is ripe for us to expand into other territories, we will embark on a Series A funding rounds to finance our expansion,” Fatty said.
Those other markets will be global ones.
“Seventy per cent of our customer base is within Kenya, with the rest across Africa and the rest of the world. As for expansion, AfricaSokoni is an African brand and we have our eyes on the rest of the continent. Where strategically viable, we may expand outside Africa to serve our customers in the other parts of the world,” said Fatty.
Feedback from existing customers is good, which Fatty puts down to a quality team that is able to learn and adapt quickly, as well as a well thought out plan.
“The research that was conducted as part of our preparation to enter the market indicated, among other things, that customers had real issues in the timely delivery of their orders, hence our 24-hour delivery policy within Nairobi,” he said.
“There is also no real, deliberate focus on the promotion of African businesses and products within and outside Africa. This forms the cornerstone to our B2B model.”
The market is, clearly, busy, with AfricaSokoni having a number of competitors. Fatty does not think this is necessarily a problem, however.
“Yes, we have many new entrants in the e-commerce space in Africa, and therefore, competition is becoming more severe,” he said.
“However, in my opinion, the e-commerce ecosystem is still at a very early stage in Africa, and the potential for growth is very high. What the players need to focus on, together, is their role in the journey of the African consumer, to transition from bricks and mortar shopping to the virtual marketplace. This transition is happening but rather slowly, the consumers still have doubts in the online space, and if we can engage the customers to remove these doubts, we will see tremendous growth in the e-commerce space in Africa.”
AfricaSokoni’s revenue model is mainly commission-based, though it will explore other revenue models as it introduces other components of its business model.