Kenyan startup MarketForce acquires Digiduka to consolidate distribution of consumer goods with digital financial services in Africa
MarketForce, the Kenyan end-to-end retail distribution startup for consumer brands in Africa, announces the strategic acquisition of Digiduka, a startup on a mission to bring informal retailers in Africa into the digital economy.
The MarketForce B2B “RejaReja” marketplace, enables informal shops to source, order and pay for inventory at anytime via interactive SMS and mobile app, and get it delivered within hours, saving them time and money that they would have had to spend if they closed shop and went out to look for stock. In the past, a ‘duka’ needed to inconveniently source inventory from up to 20 different suppliers every week and sometimes order in bulk to get better rates, even when they do not need such large quantities. To solve this, RejaReja ensures retailers are able to access a diversified product portfolio, as well as volume-based discounts through aggregation of orders across multiple retailers in a territory.
Digiduka, which was formed and funded during the inaugural cohort of the Antler programme in Nairobi, works with similar informal retailers by enabling them to make extra money by reselling digital services such as airtime, electricity tokens and bill payments. Digiduka also provides a wallet that allows retailers to collect mobile money and bank payments via mobile app, WhatsApp bot or USSD shortcode, eliminating the high mobile money transaction fees and encouraging both merchants and end users to reduce the use of cash. Digiduka was among the eight African startups selected for the Facebook Accelerator: Commerce program in 2020.
Within 10 months of launch, RejaReja has been able to directly serve over 12,000 informal retailers in Kenya, fulfilling over 75,000 orders; while Digiduka also experienced amazing reception within the first year of launching, with over 6,800 merchants acquired across several major Kenyan towns. Digiduka is on track to triple the user base and process in excess of US$ 5 million in transactions through the platform in 2021.
“Our team is excited to join forces with MarketForce and go after this US$ 700 Billion market opportunity together. Despite the seeming runaway success of mobile money in Kenya, a huge 92 percent of retail payments for daily expenses are still made in cash, among informal retailers and low-income consumers. The opportunity to digitize a large portion of this transactions and extend working capital to these retailers is also largely untapped due to the perceived risk that MarketForce resolves through having reliable data on re-stocking patterns at the retail level,” says Roy Njoka, Co-founder and CEO of Digiduka.
The acquisition accelerates the integration of financial services into RejaReja and consolidates two businesses that share a common goal of providing an all-inclusive digital commerce platform for informal retailers in Africa. The entire Digiduka team joins MarketForce; and most notably Roy Njoka and Lovell Larbie, the Cofounders of Digiduka, join MarketForce as the VP of Partnerships & Digital Financial Services (DFS), and VP of Engineering respectively.
“Our teams share a vision and values, to a large extent. Therefore, acquiring Digiduka instead of competing with them just makes sense. It’s all about two solid teams coming together to create a massive impact in African retail. This is a case where one plus one is equal to five,” said Tesh Mbaabu, MarketForce Co-founder and CEO.
This is a powerful fintech step forward for Marketforce as we plan to empower retailers even further, by enabling them to act as a one-stop shop for even more financial services like insurance and banking services in Kenya and other markets. Enabling them to upsell such services drastically increases retailer earnings while solving the last-mile distribution challenge and driving financial inclusion for millions of Africans.
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