Nigeria’s Kwik gets $2 million to add financial services to its last-mile delivery offerings – TechCrunch
Kwik, a Nigerian and French startup that provides logistics services to B2B merchants, from social providers to e-commerce platforms, raised $2m in Series A funding.
The financing round was led by XBTO Ventures, a crypto-finance company with a VC arm that invests in digital assets, among other types of startups. New and existing investors such as Humla Ventures, Nabuboto, Ubisoft CEO Yves Guillemot and Pulse Africa founder Leonard Stiegeler participated.
Kwik plays in a crowded logistics and delivery space with well-known suppliers in Nigeria such as Gokada – and other parts of Africa such as Egypt’s YDS and Bosta. Its last mile delivery service connects businesses of different sizes to find independent delivery people to transport their products to businesses and individuals..
According to founder and CEO Romain Poirot-Lellig, his company wants to “bring the informal economy into the formal economy”, focusing on last-mile delivery, e-commerce (warehousing and fulfillment) and financial services..
“Our goal is for Kwik to become the first choice app for African social providers and traditional merchants going digital. Integration of delivery, payment and e-commerce tools seamlessly in an easy-to-use mobile app is an eye-catching proposition,” he said.. “This funding round will allow us to grow in all three key verticals and select geographies.”
Kwik has made significant progress in providing last mile delivery and e-commerce fulfillment services to merchants. Since launching in Lagos in 2019 and expanding its presence in Abuja, the company has onboarded over 100,000 merchants who use Kwik’s site and mobile apps to manage their businesses’ logistics, commerce and finance needs.. More than 75% are weekly active users, Poirot-Lellig said.
“We’re not trying to make a super-like customer app. We want to make a super merchant app. We were in the process of building an app that merchants can use to manage their online businesses, from sales to delivery to financing, said the CEO, who invested €200,000 of his money in the startup in 2019..
“We are purely a software company. We are creating a community and a matchmaking ground. We ensure that the rules of the playing field are respected, both on the side of the merchants and on the side of the partners.
Kwik runs an asset-light and marketplace model where it liaises with third-party vendors of bikes, trucks, vans, and warehouses and connects them with traders. According to information on its site, package deliveries – ranging from parcels to groceries – take less than two hours.
The two-year-old company, which raised a $1.9 million seed round last March, takes an average commission of 20% for each delivery.
The final piece of Kwik’s puzzle, financial services, took off towards the end of 2021 after launching payment services, which the company says now accounts for more than 10% of its GMV.. But there is more to to be built around that, and the new investment is helping to accelerate growth in that aspect.
“The financing part is the last part we build. At the moment, we connect cyclists with financing institutions that agree to finance bicycles. In addition to this, we will launch by the end of the year a B2B lending marketplace to enable merchants to obtain financing.
Kwik will also use the funding for customer acquisition and financing transactions in Nigerian cities beyond Lagos and Abuja – Ibadan, Kano, Port Harcourt and Kaduna. Poirot-Lellig also said the company plans to increase the number of merchants on its platform to 800,000 by the end of the year.