The current economic crisis has slowed things down, including funding. It has left many startups struggling to secure financing, with Africa being hit particularly hard since many of its startups rely primarily on foreign investors. Despite that, Vendease is going strong, securing $30 million in funding that will go toward its goal of making food more accessible in Africa. It is an important goal since many restaurants and food businesses struggle against unreliable supply, limited access, and more as they try to feed over 700 million people. Read the announcement below to learn more.
Vendease, a Y Combinator-backed digital platform that allows restaurants in Africa to buy supplies, access financial services and power their business operations, has raised $30 million in an equity and debt funding round to consolidate its growth and operations in Nigeria and Ghana, and to support its expansion across the continent.
The series A equity round of $20 million was co-led by TLcom and Partech, in a rare joint investment by two of the biggest Africa-focused funds. The equity round also included VentureSouq, Hustle fund, Hack VC, GFR Fund, Kube VC, Magic Fund and Kairos Angels, who re-invested after participating in the previous round. The $10 million debt round was raised from the local finance market.
Africa’s restaurants and food businesses feed 700 million people across the continent daily. However, these businesses lose $100 billion annually due to expensive and unreliable supply, limited access to data to inform procurement decisions, wastage and theft, as well as limited access to capital to fund procurement.
Vendease’s digital procurement engine makes it easier for restaurants in 8 cities across Nigeria and Ghana to buy food supplies at considerably cheaper rates than open market prices, with guaranteed 12-hour delivery. The company is building the operating system that automates the flow of food from farm to restaurant, optimises business operations across the value chain through accurate data deployment, reduces wastage and drives profitability. Restaurant owners simply need to download the app, complete the registration process in a few clicks and they will be able to access all the benefits of Vendease’s platform. They can also access working capital through Vendease’s Buy-Now-Pay-Later offering to maximise the growth opportunities available to them.
Despite ongoing inflation and global shortage in food supply, Vendease’s solutions have delivered significant savings for its users and provided relative stability for their stock levels. Over the last 12 months, Vendease has moved more than 400,000 metric tonnes of food through its platform, helping its users save more than $2,000,000 in procurement costs and more than 10,000 procurement man-hours. Its data has also helped them reduce wastage from overstocking by an additional $485,000. The company has seen 3x growth in the number of users on its platform and 5x growth in its revenue over the last 12 months. Users have also accessed more than $12 million worth of inventory via its embedded finance product. The new funding will support the delivery of these services to more restaurants and food businesses across Africa, as well as the development of new solutions and services to drive growth across the food value chain.
Commenting on the funding, Tunde Kara, CEO and co-founder of Vendease, said, “our mission is to enable the efficient flow of food across the continent, from point of production to point of consumption. It is more than just placing orders for supplies, we want to transform how the entire sector works and remove the bottlenecks that stunt the growth of restaurants and food businesses. With greater efficiency in the supply chain, we believe we can unlock more growth opportunities across board, which is why we are excited to have raised this round, led by two of Africa’s biggest VCs, who understand what it takes to power such an ambitious mission.”
Following their investments, Andreata Muforo (Partner at TLcom) and Cyril Collon (General Partner at Partech) will join Vendease’s board as new directors.
Andreata Muforo, Partner at TLcom, said, “Restaurants and food businesses play a vital role in communities across the continent and Vendease is on a mission to bring affordability, convenience, and reliability to these businesses and builds a platform that allows the wider food sector to optimise their operations. We look forward to working alongside the team as they pursue the next phase of growth and unlock significant value in Africa’s fragmented food supply chain.
“Vendease is delivering vital solutions that impact critical issues around the food system in Africa,” said Cyril Collon, General Partner at Partech. “We are thrilled to be working with them to take these solutions to more restaurants and food businesses across the continent. We see huge scope for growth in Nigeria and beyond and we are very optimistic about what can be achieved”.
The original announcement can be found on Vendease’s website.
Spencer Hulse is a news desk editor at Grit Daily News. He covers startups, affiliate, viral, and marketing news.