Tushop, a Kenya-based social commerce platform that supplies fast-moving consumer goods (FMCGs) to communities has raised $3 million in pre-seed financing.
This current funding will be used to expand across Nairobi and strengthen Tushop’s distribution chain.
The round was led by 4DX Ventures with participation from JAM Fund, Breyer Capital, Chandaria Capital, TO Ventures, Golden Palm Investments, FirstCheck Africa, DFS Lab and Wasoko (formerly Sokowatch).
The oversubscribed round also saw participation from angel investors including GB Agboola (CEO, Flutterwave), Raja Kaul (President, Sundial Group), Eli Pollak (CEO, Apollo Agriculture), and Ida Mannoh (Director of Growth, Chipper Cash).
Tushop flagged off operations in 2021 with Cathy Chepkemboi doubling as both founder and CEO.
Tushop is a social-commerce platform that enables communities in Nairobi to buy groceries more cheaply with free last-mile delivery. This saves the time, money and energy that would have otherwise been expended.
The startup sets up “community leaders” who collate orders from members of the community and in turn forward the order to Tushop. The tech-driven platform through its partnership with suppliers delivers the itemised grocery to the partnering communities.
Since Tushop understands the fragmented nature of the distribution chain in Kenya, the startup is well positioned to manoeuvre through the marketplace to deliver a superior experience to its suppliers, ‘side-hustling’ Community Leaders, as well as end-customers in an integrated manner.
Community group-buying saves consumers up to 60% on groceries compared to buying in supermarkets, dukas, or at “mama mbogas”, while providing the added convenience of free delivery.
Similar community group-buying companies in other markets have achieved significant success, such as Nice Tuan in China and Favo in Brazil.
“We are stoked to be working with some of the leading investors globally and locally who really understand the African space from a logistics, tech, and payments perspective, and look forward to justifying their faith in us with future growth, commercial success, and meaningful social impact,” Cathy Chepkemboi, founder and CEO at Tushop, said.
“Wasoko’s investment in us is also a validating signal of the work we’ve done so far and we look forward to working closely with them to scale Tushop,” she said.
Tushop claims its model is making significant progress in problem solving. For example, Kenyans on average spend 46% of their income on food (compared to 6% in America, 22% in China, and 16% in Brazil), and while community group-buying is still nascent, the market has enormous potential: Africans spend $260B yearly on food.
“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,” said Peter Orth, Managing Partner at 4DX
“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.”
