Wasoko Stays Bullish With Congo Expansion Despite Sector’s Struggles
Wasoko, the Kenya-born e-commerce company digitising informal retail supply chains, is expanding its operations into the Democratic Republic of Congo (DRC). This expansion follows the startup’s recent launch in Zambia in May 2023 and is part of efforts the company say is key to its mission to drive growth for local businesses across Africa.
Wasoko has expanded its market coverage to serve small businesses in Goma, the capital of DRC’s North Kivu province. This expansion has been made possible through access to special cross-border trade zones with support from the Rwandan government, aimed at fostering regional economic integration. By doing so, Wasoko contributes to the integration of the DRC into the East African Community while supporting economic growth, job opportunities, and sustainable development, a press release shared with WT emphasises.
Wasoko’s expansion comes as a boost in contrast to the bearish sentiments that have hung over Africa’s business-to-business (B2B) e-commerce sector for much of this year. E-commerce startups operating the B2B model of serving small retailers in the last mile have been an attractive destination for investor dollars pouring into African tech over the past couple of years, raising ~USD 250 M in 2022 per WT data.
However, such businesses, despite receiving significant capital, have been forced to shrink back as a result of new dire funding realities and challenges in the markets they serve. Notable, well-capitalised players such as Twiga, MarketForce, Alerzo, and Copia, have resorted to scaling back significantly, resulting in the nixing of certain operations and layoffs that impacted hundreds of jobs. However, insiders and stakeholders maintain the sector holds vast opportunities and the recent struggles are short-term setbacks in the journey to finding optimal solutions that could prove successful long-term.
Wasoko, valued at around USD 625 M as of its last funding round, appears to be having better fortunes, having not been in the news with regards to layoffs and making good on plans revealed last year to continue its expansion into new territories in 2023.
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Since its expansion into Rwanda in 2019, Wasoko’s revenues have grown significantly, from USD 2 M in its first year to USD 48 M in 2022, the company revealed. The platform currently serves over 5,000 informal retailers in Rwanda. Building on its success in Rwanda, Wasoko aims to replicate this growth for small businesses in the DRC.
Daniel Yu, Founder and Global CEO at Wasoko, highlighted the potential of the DRC’s e-commerce sector, despite infrastructural challenges. He believes that Wasoko’s cross-border logistics capabilities, established platform, and product range position the company to become a market leader in the DRC’s B2B e-commerce space. Yu also emphasizes the importance of adapting to the unique needs of the Congolese population.
Wasoko (fka Sokowatch) has leveraged technology to address supply chain inefficiencies faced by local shop owners in Africa’s informal retail sector, since launching in 2016. With a presence in Kenya, Tanzania, Rwanda, Uganda, and Zambia, the company has built a network of over 220,000 informal retailers and delivered more than 5 million orders. Wasoko’s mobile app allows shop owners to purchase goods, receive real-time sales data, and access business insights. The company raised a significant USD 125 million Series B round in March 2022 and has been recognized as Africa’s Fastest Growing Company by the Financial Times.
Following its expansion into the DRC, Wasoko plans to replicate this model in other regions across Africa, strengthening its Pan-African presence and empowering local businesses while connecting consumers with a diverse range of products and services.
Philip Lucky, Acting Chief Investment Officer of Rwanda Development Board, praised Wasoko’s expansion as part of Rwanda’s successful strategy to attract investors and startups while reiterating the government’s commitment to improving Rwanda’s ICT and innovation ecosystem.
