African startups are increasingly sapping so much from Venture Capital market this year. Joining, Lori, Twiga Foods and others to raise funds in Kenya this year startup Taz Technologies, which is behind patented addressing technology MPost. In its latest Series A round of funding, the startup has closed a US$1.9 million to finance its expansion and further development of its proprietary platform.
Here Is The Deal
- This round of funding was led by both existing investors such the Cape Town-based VC firm HAVAÍC and new investors from South Africa, Australia, Japan, the United States (US), Canada and Nigeria, with more investors including blue-chip institutions, VC funds, and high-net-worth individuals.
- Mpost intends to use the investment to fund its expansion and for further investment in its proprietary technology platform and operations.
- Taz will continue with its strategy of expanding into the East African region, and later Sub-Saharan Africa.
“With the support of our investors, we are accelerating the development of our product functionalities and creating other value-added service offerings,” said co-founder Abdulaziz Omar.
Why The Investors Invested
South Africa’s Cape Town-based VC firm HAVAÍC has previously invested an undisclosed amount in Mpost, with Rob Heath, the partner responsible for pan-African and international business at the firm citing reasons for investing in Mpost as thus:
“After spending time with Aziz and Twahir in Nairobi and seeing the solution in action, it’s clear that this is not just a technology and commercial product. MPost makes a real impact on people’s daily lives and as an investor, it’s rewarding when we can tie these two elements together. That being said, this is a great example of African problems producing global solutions — one of the cornerstones of our investment thesis at HAVAÍC.”
But perhaps the most crucial metric for investing is that Mpost has already gained more than 40,000 users, mostly as a result of its partnership with the Postal Corporation of Kenya, a fact which would easily excite investors. To further understand that investors invested because of this. the startup has been primarily self-funded since its founding, although it first obtained some angel investment in 2018.
A Look At What Mpost Does
- Founded in 2015 by Abdulaziz Omar and Twahir Mohamed, MPost is a platform that enables the conversion of mobile numbers into official virtual addresses, which allows notifications to be sent to clients whenever they get mail through their postal addresses.
- The MPost technology provides a convenient, reliable and affordable way of sending and receiving packages, as well as providing last mile connectivity, through post offices worldwide. Taz has partnered with the Postal Corporation of Kenya (PCK) to provide virtual postal addresses, meaning MPost customers can now collect their parcels or letters at any of the 623 postal offices countrywide.
- Taz was one of the 10 African tech startups selected into the Startupbootcamp AfriTech programme in 2018, and the accelerator’s co-founder and chief investment officer (CIO) Zachariah George is now a strategic advisor to the company.
“We are extremely pleased at the key commercial traction and corporate partnerships that MPost has achieved during and post the programme, and are delighted that this product-market fit has been validated by a strong consortium of global investors in their Series A round,” Omar said.
Meanwhile, last month mobile operator Safaricom and PCK launched the MPost partnership, which affords Safaricom’s 33 million customers the ability to register for an MPost address via a dedicated USSD code provided by the firm.
Comments:
Indeed, Mpost is teaching other African startups doggedness in the face of tough times, and the importance of attaching to a bigger, but neglected market such as the public mailing system. On the other hand, a look at the diversity of investors shows that trust, which is the central point in choosing where to invest, is building momentum in the East African country of Kenya. Recall that Kenya topped the chart for startup funding in 2019 and that Chinese investors recently led major investment in the country’s locally founded Lori Systems,unlike in Nigeria where they prefer to launch from the scratch. This is one feat we would take away from Chinese investors’ behavior in the African startup ecosystem in 2019. They simply invest directly in ecosystems they have more trust in , while launching out fully from the scratch in others.
On a lighter note, give it to Mpost’s team for the persistence. This $1.9 million round is the deal breaker, the freedom they have been looking for to fly.
As 2019 winds down, there are strong indications that the African startup ecosystem is finally catching up a bit with the rest of the world, and the picture may even look bigger in 2020.
Those who launched out today, may have started early.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organizations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution, and data analytics both in Nigeria and across the world