Nigeria-based Business to Business (B2B) eCommerce startup, Omnibiz has announced securing $3million in a seed round. It plans to expand into other cities in West Africa and participate in Seed Stars' accelerator program.
Led by V&R Africa, Timon Capital and Tangerine Insurance, this seed round also saw investments from Launch Africa, Sunu Capital, Musha Ventures, Rising Tide Africa, and LoftyInc. Swiss-based emerging markets investment company, Seed Stars also joined the round.
Founded by Deepankar Rustagi — CEO — in 2019, Omnibiz connects manufacturers of fast-moving consumer goods (FMCG) with local retailers using a mobile app, WhatsApp and a phone number.
Omnibiz is not Rustagi’s first attempt at building a business in Africa, having previously founded VConnect, which allowed people to find local professionals. This experience, he says, would come in handy as he pilots the affairs at Omnibiz.
“We knew about small businesses and what sort of technology they like. That was our specialisation, but our business model didn’t work. But in this case (Omnibiz), the monetisation works on our platform, and there’s money to be made for the small business. We’ve been growing 30% month-on-month for the last 12 months,” he said in an interview with TechCrunch.
eCommerce in Africa has seen massive growth, driven in part by increasing internet and smartphone penetration. However, this growth has happened mainly in the B2C space. However, recently, startups have sprung up looking to digitise the retail process for B2B. Twiga, Trade Depot, and MaxAB are just a few of these startups.
Omnibiz operates an asset-light model that Rustagi believes will accelerate its growth. “I think scaling in one city with assets is not that difficult. But if you have to scale in 20, 24 cities in a country like Nigeria or Ghana, or Ivory Coast or East Africa, the investment required will be very high, so we think without significant investment in assets, we will be able to scale much faster.
"And since we took the tech-first approach, we have good control over the business. I believe we’re in the right space and the right time with the right model.”
Their investors share this optimism with Raj Kulasingam and Vishar Agarwal of V&R Africa, saying in a statement, “I think Omnibiz will be the role model for B2B retail in Africa and can scale well into other emerging markets. We are excited and happy to be supporting Omnibiz in all ways beyond just providing capital.”
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With this new investment, the startup plans to expand its product categories to include alcoholic beverages and OTC pharmaceutical products while entering Ghana and Ivory Coast.