The B2B funds sector in sub-Saharan Africa gives loads of promise. In keeping with a 2016 World Bank report, micro, small, and medium retailers paid out $1.5 trillion to their suppliers in 2015. Presently, this sector is dominated by money funds and offline financial institution transfers, which has brought on late funds and the slowdown of commerce on the continent.
A Quickbooks survey from final yr, masking 3,500 firms throughout 6 nations, reported that 23% of small companies skilled delayed funds. A recent report from Duplo, which included the surveyed opinions of greater than 1,000 enterprise house owners from Kenya, Nigeria, South Africa, and Egypt, highlighted that 44% of companies nonetheless have to attend greater than 24 hours to obtain funds from enterprise clients and companions. The report additionally exhibits that 34% take as much as 7 days to obtain funds, 17% take as much as 30 days, and three% take greater than 30 days to obtain enterprise funds.
This slowdown in enterprise capital could be a harbinger of doom for fast-moving client items (FCMG) companies. Money movement restrictions, mixed with the prevalence of fraud and theft that inevitably include shifting giant sums of cash, can spell the top for these companies. To treatment this, they must resort to time-wasting and tedious administrative procedures, which finally divert scarce assets.
Offering an answer to those issues is Duplo, a Nigerian business-to-business fee platform that digitises fee flows. Based in 2021 by Yele Oyekola and Tunde Akinnuwa, the corporate not too long ago introduced that it has raised $4.3 million in seed funding to launch new merchandise and broaden into new enterprise verticals in Nigeria.
The seed funding spherical included investments from Liquid2 Ventures, Soma Capital, Tribe Capital, Commerce Ventures, Basecamp Fund, and Y Combinator. Oui Capital additionally re-invested after taking part within the earlier spherical.
In an announcement shared with TechCabal, Peter Oriaifo, Principal at Oui Capital, stated regarding the increase: “The Duplo staff has constructed an unbelievable suite of merchandise that improves how companies make and obtain funds from one another, and the expansion that the corporate has skilled since our preliminary pre-seed funding in 2021 has been nothing wanting spectacular. It is for that reason that we’re excited to again Duplo as soon as extra.”
On a name with TechCabal, Yele Oyekola, cofounder and CEO of Duplo, stated that for the reason that firm’s pre-seed of $1.3 million earlier this yr, the corporate has grown its month-to-month fee quantity by 4,000%, and it has additionally elevated its buyer base over the previous three months by over 1,000%. He added that with this new increase, the corporate would enhance on its merchandise, develop new merchandise akin to cross-border funds, and improve the industries it presently operates in. Duplo largely operates within the fast-moving client items (FMCG) sector, however in line with Oyekola, the corporate needs to pivot to new industries akin to building, telecommunications, and healthcare.
Having been a part of the Y Combinator Winter 22 batch, Oyekola stated that the accelerator has been immensely useful in instructing them what to keep away from within the early levels and learn how to obtain product-market match.
Regardless of the latest slowdown in funding globally and uncertainties with their present spherical of seed funding, Duplo has been capable of increase a mixed $5.6 million in pre-seed and seed funding. In keeping with Oyekola, it’s because buyers are excited in regards to the alternative that exists within the B2B funds sector in Nigeria and Africa as an entire.
Earlier than co-founding Duplo, Oyekola had beforehand labored at Carbon, constructing the preliminary variations of Carbon Zero, a buy-now-pay-later product. He additionally co-founded Julla, a buy-now-pay-later product for East Africa. Though Julla crashed after a yr, Oyekola stated the teachings he realized have been important in co-founding Duplo.
In keeping with Oyekola, he noticed the necessity for Duplo due to the fraud and theft points his grandmother endured for years as one in every of Nestle’s distributors in Osun State, Nigeria. Since January 2022, Duplo has aided FMCG distributors, mid-size finance groups, and enterprise organisations in digitising and streamlining the best way cash strikes between them and their enterprise companions. FMCG distributors can add retailers to the Duplo platform, making it easier for them to simply accept funds on-line and achieve real-time enterprise efficiency info. The platform additionally allows them to automate funds to distributors, producers, and suppliers, and with on the spot funds, they’ll transact in bigger portions.
Duplo’s end-to-end answer additionally automates the process of making and processing invoices, accepting and approving payments, gathering and disbursing funds, and ending account reconciliation for finance departments.
The B2B funds sector has lengthy been uncared for due to the complicated processes related to making funds. With a digital answer like Duplo, there is a chance to vary this sector.
For Oyekola, this rings true. In an announcement shared with TechCabal, he stated: “We strongly consider that there’s a nice alternative to catalyse progress and maximise enterprise alternatives throughout the continent by eradicating the bottlenecks that hinder the seamless movement of cash between companies, and we’re excited to have raised funding from this thrilling group of buyers to ship this much-needed transformation.”