Lagos-based early-stage venture capital firm Microtraction, in what is the investor’s ninth deal since inception, has backed Nigeria’s Sendbox, a tech-driven provider of delivery, escrow payments and authentic reviews for people who use social media platforms for e-commerce. While this is the firm’s first financial injection of the year, indications suggest that the investment was made this month.
Reliable shipping is a painful process for individuals, SMEs, and businesses that require it. E-commerce websites, marketplaces & other kinds of companies that need courier services have this difficulty, and either has to partner with one or more service providers directly or build their own delivery operations.
Platforms like Amazon typically provide the infrastructure for payments, fulfillment and authentic reviews which creates a system of trust that users can rely on. Unfortunately, this infrastructure is missing from social platforms like Instagram and Facebook, especially for users in Africa.
Sendbox creates a platform that provides shipping, escrow payments, and discovery services to merchants and customers who carry out e-commerce transactions using social channels like Instagram, Facebook, and WhatsApp. They allow users safely partake in e-commerce on distributed social platforms by providing a means to identify trustworthy merchants, securely pay for items using an escrow system and ship to domestic and international destinations at discounted rates from their aggregated delivery partners.
According to Microtraction Partner Dayo Koleowo, Sendbox, at the time of investment, had already signed up over 4,000 merchants with approximately 1000 users who have actually used the product at least once in the last six months. They were also generating over $4,000 in revenue monthly. They had over 400 active users (new and returning) with over 40% of transactions being made by returning users.
The Lagos-based tech startup was founded in 2016 by CEO and CTO Emotu Balogun and COO Olusegun Afolahan. Microtraction funds smart, relentlessly resourceful founders who are building high growth, technology-driven businesses in billion-dollar markets. The firm initially invests USD 15 K for 7.5% equity stake, followed by an additional USD 50 K convertible note at a USD 1 Mn valuation cap in companies that show significant progress after our initial investment