Kapu, a social commerce startup, has raised $8 million in seed funding to help reduce the burden of buying food for Kenyan consumers.
The seed round was co-led by Giant Ventures and Firstminute Capital, with participation from Founder Collective, Base Capital, Norrsken and Raven One.
They join Kapu’s early backers, including India’s Meesho and Brazil’s Facily co-founders, and a number of African family offices, Twitter’s Biz Stone, Supercell’s Ilkka Paananen, Tom Blomfield of Monzo and serial entrepreneur Alexander Rittweger.
The startup which was founded by Sam Chappatte is expanding its network of local agents where consumers can place orders. It will soon support WhatsApp orders too. By sourcing directly from manufacturers and producers, Kapu enables group bulk-buying of groceries and claims to help consumers save up to 30% of the spend on fresh produce and packaged consumer goods.
Kapu says it has 1,500 agent collection centers across Nairobi, and will, in its next phase of growth, work to fully penetrate Kenya’s capital before expanding to new markets.
Kenya is said to have one of the highest percentages of monthly WhatsApp users in the world, according to Global Web Index’s 2020 Social Media User Trends Report — happening as the popularity of the social commerce sector surges in the region as the shift toward online shopping continues post Covid pandemic.
Kapu said the offline channel (through agents) and online direct to consumer (via WhatsApp) models are designed to suit the Kenyan market, where e-commerce has not taken off but social commerce is showing signs of potential.
“People spending like 40 to 50% of their household income on the grocery basket is a big problem for society, but it is also a huge opportunity … The reason we started Kapu is that we think that there is a more relevant model of e-commerce that can be built to target the grocery basket, which is the biggest portion of spend for the vast majority of consumers. And if by using technology we can bring efficiency then we can have a tremendous impact on society for consumers and businesses”, said Chappate.
Sam Endacott, a partner at Firstminute capital, said in a statement: “Sam is deeply experienced in both the e-commerce and logistics category and we are thrilled to partner with him and the entire Kapu team to help alleviate the cost of the living crisis on the Continent for consumers, unlock social mobility and drive growth for SMEs in the region.”