Namibian B2B e-commerce retail platform JABU raises $15M led by Tiger Global – TechCrunch


More and more venture capital continues to flow into B2B online retail in Africa, a space where startups are digitizing informal commerce to enable thousands of merchants to operate more efficiently.

This time, it’s a startup that hit the headlines in January: Namibia-based JABU, whose $3.2 million seed round we covered. Now, the last-mile distribution e-commerce company has received more investment: a $15 million Series A led by Tiger Global.

The round, which closed in March, is Tiger Global’s second investment in the B2B e-commerce space after backing Wasoko in its Series B mega round. only Tiger Global reported a loss of $17 billion in this year’s technology sale.

Other investors in this growth round include Box Group, Knollwood and D Global Ventures. Some backers of its round: Afore Capital, Oldslip and FJ Labs also doubled.

For many years, traders who own kiosks and small to medium-sized stores across Africa have faced logistical challenges when ordering their products from wholesalers and distributors. Startups like JABU and several others such as Wasoko, TradeDepot, Omnibiz, MarketForce, MaxAB and Chari have facilitated this process through more efficient applications and distribution channels.

With JABU, merchants can order, store and pay for their products through Jwallet and expect same-day delivery, the YC-backed company said. As of January, the company had over 6,000 merchants using its platform in Namibia, South Africa and Zambia. CEO David Akinin said that number had increased by 50%.

The company also provides data-driven services such as sales metrics and agent performance to FMCG brands and banks through dashboards.

Ultimately, Akinin said JABU wanted to build around its Jwallet, the wallet system currently launching as a standalone product. Jwallet enables merchants in Southern Africa to use their physical flows to offer cash pickup and deposit services to their customers. This game is akin to branch banking, a branchless banking system in Nigeria and West Africa where human agents act as ATMs to offer financial services in remote areas. Chari offers an identical offer in Morocco.

“You can offer your end consumers the ability to withdraw and deposit money to their wallets and bank accounts through JABU,” Akinin said. “So we connect an API to the banks in the exchange, literally to allow someone who received money through the wallet to go to a JABU merchant who can use their physical float and withdraw money. “

There are other functional parts of Jwallet. According to the company, drivers who handle distribution for its 232 logistics partners and use the wallet for payments can access asset financing and, for merchants: inventory financing. More on the latter, Akinin said he bets the wallet system can provide a more sustainable alternative to the popular BNPL model that other platforms offer traders.

“I think buy now, pay later is an optical illusion. I think there’s credit, and there’s cash, and there’s nothing in between,” said Akinin said. “So I think he [BNPL] it will make the situation worse for small businesses, it will create more defaults, it will generate a culture of bad wages, and it will create real debt at the level of SMEs in Africa, it will be difficult to justify.

Its bias stems from the fact that it experienced flaws when JABU tried the BNPL model in the past. Akinin recounted how traders would use a platform’s BNPL offering, generate revenue and proceed to pay the next bill with that profit, or buy stock from another provider in an entirely different supply chain. .

Jwallet circumvents this by partnering with banks to make digital payments and creating communities for merchants to save and provide lines of credit to each other on the platform. This process also helps merchants build their transaction histories while they generate enough revenue – from providing financial services to end customers – to repay.

“A lot of what we do with our Jabu wallet is to build an ecosystem around the community and the store rather than around our balance sheet. We’re excited about this as a product, because we’re trying to prove as we scale that there’s a different way to interact with stores. »

The Series A round will see JABU deepen its presence in Southern Africa and expand into new markets like Botswana and Eswatini later this year. Akinin says what sets his startup apart from others is how it creates a much larger ecosystem for small businesses rather than just a marketplace.

“Many companies like ours are taking money out of the market. We’re trying to build a business that brings products to market and continues on a journey that has a multiplier effect by moving that money around that market 20 times. And I think that’s the purpose of building the JABU wallet. There will be shared services; other products will flow from this, as will the ability to pay for services and products in these markets.

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