MarketForce, a Kenyan end-to-end retail distribution company for African consumer brands, has announced the strategic purchase of Digiduka, a two-year-old startup dedicated to bringing Africa’s informal shops into the digital economy.
Digiduka, which was founded and financed during the Antler program’s first cohort in Nairobi, helps comparable informal sellers generate extra money by reselling digital services including airtime, power tokens, and bill payments. Digiduka also offers a wallet that allows merchants to accept mobile money and bank payments using a mobile app, WhatsApp bot, or USSD shortcode, avoiding expensive mobile money transaction costs and encouraging both merchants and end users to spend less cash. In 2020, Digiduka was selected as one of eight African businesses for the Facebook Accelerator: Commerce program.
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“Our team is excited to join forces with MarketForce and go after this US$ 700 Billion market opportunity together. Despite the seeming runaway success of mobile money in Kenya, a huge 92 percent of retail payments for daily expenses are still made in cash, among informal retailers and low-income consumers. The opportunity to digitize a large portion of this transactions and extend working capital to these retailers is also largely untapped due to the perceived risk that MarketForce resolves through having reliable data on re-stocking patterns at the retail level,” says Roy Njoka, Co-founder and CEO of Digiduka.
The acquisition will hasten the integration of financial services into RejaReja, MarketForce’s B2B marketplace, which allows informal shops to source, order, and pay for inventory at any time via interactive SMS and mobile app, and have it delivered within hours, saving them time and money they would have spent if they had to close shop and go out looking for stock.
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Within 10 months of launch, RejaReja has been able to directly serve over 12,000 informal retailers in Kenya, fulfilling over 75,000 orders; while Digiduka also experienced amazing reception within the first year of launching, with over 6,800 merchants acquired across several major Kenyan towns. Digiduka is on track to triple the user base and process in excess of US$ 5 million in transactions through the platform in 2021.
The purchase also brings together two firms with the same objective of offering an all-encompassing digital commerce platform for Africa’s informal sellers. The whole Digiduka team has joined MarketForce, with Roy Njoka and Lovell Larbie, the company’s co-founders, serving as VP of Partnerships & Digital Financial Services (DFS) and VP of Engineering, respectively.
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Digiduka received an overwhelmingly positive response within its first year, with over 6,800 merchants acquired throughout multiple major Kenyan cities. By 2021, Digiduka expects to have tripled its user base and processed more than $5 million in transactions through its platform.
“Our teams share a vision and values, to a large extent. Therefore, acquiring Digiduka instead of competing with them just makes sense. It’s all about two solid teams coming together to create a massive impact in African retail. This is a case where one plus one is equal to five,” said Tesh Mbaabu, MarketForce Co-founder and CEO.
Marketforce has taken a significant fintech step forward by enabling retailers to act as a one-stop shop for even more financial services, such as insurance and banking, in Kenya and other markets. Enabling retailers to upsell such services significantly increases retailer earnings while solving the last-mile distribution challenge and driving financial inclusion.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning write