Sokowatch, the Kenyan B2B e-commerce startup has raised $2 million seed funding led by 4DX Ventures. Others to join the round were Village Global, Lynett Capital, Golden Palm Investments, and Outlierz Ventures.
Sokowatch’s platform connects Africa’s informal retail stores directly to local and multinational suppliers—such as Unilever and Proctor and Gamble—by digitizing orders, delivery, and payments with the aim of reducing costs and increasing profit margins.
Sokowatch founder and CEO Daniel Yu said: “With both manufacturers and the small shops, we’re becoming the connective layer between them, where previously you had multiple layers of middle-men from distributors, sub-distributors, to wholesalers.”
“The cost of sourcing goods right now…we estimate we’re cutting that cost by about 20 per cent [for] these shopkeepers,” he said
Sokowatch generates revenues by earning “a margin on the goods that we’re selling to shopkeepers,” said Yu. On the supplier side, they also benefit from “aggregating demand…and getting bulk deals on the products that we distribute.”
The report in TechCrunch said that the startup has delivered 100,000 orders to customers for “a few thousands of shops,” according to Yu and company data.
The company recently launched a line of credit product to extend working capital loans to platform clients. With the $2 million round, Sokowatch—which currently operates in Kenya and Tanzania—plans to “expand to new markets in East Africa, as well as pilot additional value-add services to the shops,” said Yu.
Peter Orth, Co-Founder and Managing Partner at lead investor 4DX Ventures, will join Sokowatch’s board of directors.
