Nigeria’s TradeDepot Secures $10m to Expand its Business into Financial Services and Credit Offerings For Retailers

TradeDepot, a Nigerian e-commerce startup has raised $10 million in funding to expand its business into financial services and credit offerings for retailers.

The new investment raised by TradeDepot, which connects international brands to small businesses in Africa, was co-led by Partech, the International Finance Corp., Women Entrepreneurs Finance Initiative, and MSA Capital.

TradeDepot since inception in 2016 has built up a network of 40,000 small businesses in Nigeria and connects them to local distributors of global consumer brands like Nestlé, Unilever, GB Foods and Danone, according to a statement.

The eCommerce startup leverages its mobile apps on Android or Whatsapp, USSD short code messaging or a toll-free phone number, retailers can place orders and have goods and services delivered through TradeDepot’s fleet of vans and tricycles.

They can make payments, order stock, and manage inventory online or through the app as well.

For consumer brands, they have a central hub through which to distribute directly to vendors on the continent, along with data that can help them manage their relationship with these small vendors.

“Africa’s offline retail market is estimated at $1 trillion, and this new investment allows us to capture an even greater segment of that market,” said Onyekachi Izukanne, in a statement.

“We will continue to use data to drive efficiencies and provide an easier stock acquisition service for our [over] 40,000 retailers, driving down costs for them by negotiating even better deals with our global manufacturing partners, whilst simultaneously providing a better, faster route to market for our suppliers.

Now, with the new capital, TradeDepot will expand into a suite of financial services and lending products for its retailers. Many of the company’s customers lack a credit rating, but TradeDepot has alternative ways to score credit based on the data it has from its existing trading relationships.

“The founders’ vision to build a digital platform that improves the unit economics of serving the mass market is one we feel privileged to support,” said Wale Ayeni, the head of Africa Venture Capital investment at the IFC.

That support disproportionately goes to helping women entrepreneurs, according to the company. Women account for over 75% of the retailers on the company’s platform. Now, with the help of its new investor We-Fi, TradeDepot will look to offer mentorship opportunities and link these business owners to global markets.

“Women play a pivotal role in driving economies across Africa, but lack of access to capital, limited market linkages, cultural norms and other challenges often prevent them from achieving the success they want,” saiid Hanh Nam Nguyen, who represents the We-Fi initiative with the IFC.

“We-Fi financing will incentivize TradeDepot to build stronger women-led small and medium enterprises (SME) retailer and distributor networks, which will support them to become drivers of economic growth in their communities.”