Tushop, after receiving $3 million in pre-seed financing from 4DX Ventures (4DX Ventures), a Kenyan website for social commerce that allows users to purchase fast-moving consumer products (FMCGs) is ready to expand throughout Nairobi.
Tushop, founded last year last by Cathy Chepkemboi (also the CEO), relies on community leaders for orders from their neighbors, and last-mile delivery.
After her resignation, Unilever [Kenya and the United Kingdom]Chepkemboi, a Kenyan furniture manufacturer, founded Tushop and Moko.
She claims she first noticed the fragmentation in Kenya’s retail industry while working for Unilever – Kenya, and that logistics was one of the difficulties that contributed to the country’s high cost of vital commodities.
Kenyan distributors source products from producers to set the price. This is often exaggerated and manipulated by retailers and distributors.
Each community leader maintains a virtual shop that residents can use to place orders. Tushop aggregates these orders and makes bulk purchases to producers, such as farmers or manufacturers.
Chepkemboi claims the structure can be used to save shoppers up 60% even though brokers are paid sales commissions.
Before extending to the rest of Kenya, the company intends to expand its business in Nairobi, Kenya’s capital.
JAM Fund, Breyer Capital, Chandaria Capital, TO Ventures, Golden Palm Investments, FirstCheck Africa, and DFS Lab were among the investors in the startup’s most recent round.
Wasoko, previously known as Sokowatch, joined the round as a strategic institutional investor. Olugbenga Agboola GB; Flutterwave CEO Raja Kaul; Sundial Group president Eli Pollak; Apollo Agriculture CEO and Ida Mannoh; chipper cash director of growth were some of the angel investors that participated.
Tushop is the latest addition to Kenya’s increasing roster of entrepreneurs revolutionizing the retail sector. Marketforce has, for instance, developed the RejaReja app that allows informal traders to order products and pay digitally.
RejaReja is a similar market to Wasoko. Wasoko distributes FMCG from retailers to suppliers. RejaReja is different from Wasoko because it is an asset-light platform for distribution. This means that it doesn’t own any capital assets like warehouses or delivery trucks. These are provided by its partners which include distributors and manufacturers.
Tushop is one of Kenya’s first social commerce websites, sourcing goods directly from producers, including fresh fruit, and delivering them to customers.
Social commerce is a relatively recent subset in e-commerce that has helped to dissolve the barriers between online purchases and social connections.
It allows micro-entrepreneurs and small businesses to easily formalize parts of their business and expedite procurement processes. Additionally, it provides seamless online experiences and greater negotiating power to clients who are not served.
Many Kenyan micros, small and medium-sized enterprises (MSMEs), are unable to access the markets because they can’t afford to establish, manage, and promote an internet presence.
Tushop makes it possible to save time and avoid the hassle of moving items from one place to another.
SME owners in Kenya can use the current economic climate to adopt social commerce and migrate to Kenya. Investors will ensure that they have all the support and assistance they need to grow beyond their existing operational zones.
Social businesses offer the chance to improve the economic conditions of a large portion of the population living in advanced markets. This is especially true for the informal sector, which is where the majority of people live. This is why it is fast becoming a crucial part of the new digital economy.
Social commerce is a great way for entrepreneurs and small merchants to get an online presence. It’s easy to set up a business and start to build a customer base.
Group buying allows low-income clients, rural clients, and those with price sensitive needs to take advantage of low prices and greater bargaining power.