After witnessing pervasive product stockouts at small retail stores while living in Egypt,
Daniel Yu founded Wasoko (formerly Sokowatch).
Originally from California, Daniel Yu always had an interest in Technology and International Business. He attended the University of Chicago to study International Studies and Linguistics because he wanted to fulfill his desire to travel around the world and learn new languages. His academic program led him to Egypt, where he spent several months studying Arabic and Egyptian culture. It was also during this time that he would come up with the business idea that became Sokowatch.
The concept was simple: enable shopkeepers to manage their orders and connect with suppliers via cellphone text messaging. He was so excited about this venture, that he eventually dropped out of University and moved to Nairobi, Kenya to build the first pilot.
Why Kenya? Daniel chose Kenya because he had been approached by several local organizations interested in building out this technology. After assembling a small initial team, he launched the first version of the product. Their model was to act as brokers between shopkeepers and suppliers, but Daniel and his team quickly realized that connecting the two wasn’t enough and they needed to solve several problems across the supply chain to actually fulfill orders on time and add value. So they decided to expand their business model and deliver the products themselves. A few years later, Wasoko formerly Sokowatch has become a full-stack, fully integrated E-commerce company with the ability to deliver basic services to shopkeepers in an average of two hours. They serve about 15,000 shops in four different countries, across nine cities in East Africa, that rely on and order from them on an active basis.
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Wasoko has a very close relationship with the shops they serve. Being their key supplier, they have visibility into a client’s sales volumes, store activity, and financing needs. This is why in 2019 they launched a financing program to extend credit lines to shops. The product has been a game-changer for clients as they are traditionally unbanked businesses with little access to credit. The shops under their credit program have doubled order volumes with Wasoko and increased sales volumes. On the back of this financing, Wasoko is also offering other financial services with affordable payment plans and is now experimenting with rolling out insurance products.
Wasoko is a startup that connects small shops to the e-commerce industry. The company intends to help entrepreneurs in emerging markets connect with the digital world, increase sales and gain market coverage.
Wasoko is the result of the efforts of co-founders Daniel Yu, David Jaress, and Josh Raine. The three established their operation in Chicago, Illinois. Their goal is to address the needs of emerging markets in West African countries.
Funding
In July 2018, Wasoko raised a $2,000,000 seed round from 4DX Ventures, Golden Palm Investments, Lynett Capital, Outlierz Ventures, and Village Global.
In February 2020, Wasoko closed a $14 million Series A funding round. The funding round was led by Quona Capital, a VC firm that specializes in fintech firms in emerging markets, Amplo, a global VC which has backed Andela and Robinhood, and Breyer Capital, which has backed Ghana’s mPharma.
In 2022, the Nairobi-based B2B platform raised $125 million in Series B funding. The investment was co-led by Tiger Global and Avenir Growth and also featured new investors VNV Global, Flipkart co-founder Binny Binsal, and Udaan co-founder Sujeet Kumar. Existing investors Quona Capital, 4DX Ventures, and JAM Fund also participated.
Growth
In 2022, Wasoko closed a $125 million Series B equity round at a valuation of $625 million, per TechCrunch. Alongside the new funding, the company rebranded to Wasoko, which translates to “People of the Market” in Swahili, and also launched in Abidjan (Côte d’Ivoire) and Dakar (Senegal), its first locations in West Africa.
Since its launch, Wasoko says it has delivered over 2.5 million orders to over 50,000 informal retailers across Kenya, Tanzania, Rwanda, Uganda, Côte d’Ivoire, and Senegal, with revenue growth over the past 12 months at over 500%.
It has also grown from a team of 10 in 2016 to now over 800 employees across 18 cities in East and West Africa.
Wasoko was named in Fast Company’s prestigious annual list of the World’s Most Innovative Companies (MIC) for 2021.
SOURCES: Tech Crunch, PMI Africa, Miguel Armaza, Golden
