Social commerce platform Tushop is ready to widen its operation across Nairobi, Kenya after securing a whopping $3 million in pre-seed funding led by 4DX Ventures. The financing round also saw the participation of venture firms – DFS Lab, JAM Fund, FirstCheck Africa, Breyer Capital, Golden Palm Investment, Chandaria Capital and TO Ventures; Wasoko, a B2B and e-commerce startup that formerly was known as Sokowatch; and a host of angel investors majorly made up of executives from African startups. They include Flutterwave’s CEO Olugbenga Agboola, Eli Pollak of Apollo Agriculture, Sundial Group President Raja Kaul, and Ida Mannoh – the director of growth at Chipper Cash.
Tushop’s business is associated with fast-moving consumer goods. The startup which was founded last year by CEO Cathy Chepkemboi encourages group purchase of FMCG using community leaders to collect orders and support last-mile deliveries.
So here’s how Tushop works. Community leaders run virtual shops where they collect orders which Tushop combines to make bulk orders from manufacturers. Shoppers get to save as much as 60 percent using Tushop while community leaders (agents) earn commissions, Tushop’s CEO said.
For Tushop, the plan is to expand in the capital city of Kenya before spreading to all other parts of the country. “We are going to scale across Nairobi, and because it is an operationally intensive business, we [immediately] need more warehouses and delivery trucks. We are hiring and also improving our technology and our agents’ channels to make the experience even better,” Tushop’s CEO explained.
Cathy Chepkemboi, a graduate of international relations who once worked in companies such as Unilever Kenya and UK, Moko, etc., said it was while she worked with Unilever Kenya that she recognized the inadequacies of the country’s retail sector and decided to launch Tushop.
“I was in the field distributing products and could see what happens on the ground…I could also immediately tell that if we were in direct contact with the customer, the cost would be lower and we could do more targeted promotions or marketing. This led to what we are doing now, sourcing from manufacturers and selling directly to consumers,” she said.
“We provide predictive delivery of affordable high-quality goods including fresh produce. And the way we’re able to do this is by working with community leaders, who gather orders from the neighbours and manage last-mile delivery. Our value proposition here is to provide our customers with a way to shop more cheaply and conveniently. We are cheaper than retail,” she added.
Tushop joins a booming market already filled with disrupters such as MraketForce, RejaReja, Wasoko, etc.
Speaking on the round and the startup, 4DX Ventures managing partner Peter Orth said that “We think that the market opportunity for Tushop is incredibly large and that Cathy is the right founder to go after it given her deep understanding of the market, and impressive execution and growth thus far. We’re thrilled to join such a strong team of other investors and advisors to help Tushop become the dominant player in group-buying across Africa.”