Pastel, a Nigerian digital bookkeeping and digital platform for merchants announced that it has raised $5.5 million in a seed round led by TLcom and other Venture Capital firms including Global Founders Capital (GFC), Golden Palm Investments, DFS Labs, Ulu Ventures, Plug and Play, and Soma Cap. It raised a $620,000 pre-seed last year from some of its existing investors.
Formerly known as Sabi Cash, Pastel was founded by Abuzar Royesh, Olamide Oladeji and Izunna Okonkwo, all former from Stanford university.
Pastel intends to expand its product offerings around group savings, loans and payments for small businesses with the new investment. This aligns with its vision to be a global leader in the micro, small, and medium businesses space, building tools that allow businesses to increase sales, process payments, access financial solutions, and immerse themselves in the digital economy.
Pastel currently has two product offerings namely:
- Sabi, not to be confused with Sabi the B2B ecommerce startup, is basically a book-keeping app which users use to record transactions, keep track of income, and send reminders to debtors; and
- Quick Receipt avails you easy templates that enable you to send out presentable invoices and receipts on the go
It is currently working on another product called Pastel Financing which will be launched soon.
According to Izunna Okonkwo, Pastel had over 100,000 merchant sign-ups by December 2021, with more than 45,000 of them active.
Interestingly Pastel chose to build its products separately instead of putting all the features in one app.
“Our thought process was to get traction quickly by solving a merchant’s pain point with a free and easy solution. The next step was to capture value. So we added value capture features to the Sabi app that our customers love. Now we are building a lot more,” Okonkwo said about the company’s decision to build three standalone platforms instead of coupling them all into one app. “The way we’ve thought about it is, as opposed to creating a super app that a lot of other fintechs have or are in pursuit of, we are taking a more platform approach, meaning that any Pastel user can create an account with any of our apps. With the same login they can access all the other solutions that we’re providing.”
The startup says it only started making revenue recently and does so by charging interest and a small fee on these loans; it also has access to savings to use as a float for loan financing.
