TradeDepot, a B2B startup that connects small shops, kiosks, retailers with wholesalers, has closed a $110 million Series B round.
The new funding round is a mix of equity and debt funding and was co-led by International Finance Corporation (Equity funding) and Arcadia Funds (debt funding). Novastar, Sahel Capital, CDC Group, Endeavor Catalyst and existing investors, Partech and MSA Capital also participated in this round.
This is not the first time IFC is playing a role in the startup's funding round. Eighteen months ago, the duo of the International Finance Corporation (IFC) and Partech Africa co-led a $10 million Series A round for the B2B platform.
TradeDepot's latest funding round means that the total investment in the startup is $120 million. Also, TradeDepot $110 million series B round is the largest for any B2B e-commerce platform in Africa at the moment, both in equity and debt.
The second fact shows that investors are bullish on Africa's B2B e-commerce platforms.
One reason for this is the sales revenue of small and medium-sized businesses, of which a large majority are offline. These businesses generate $1 trillion in sales annually and contribute $2.6 trillion to the continent's nominal GDP.
"Four or five years ago, if you were having a conversation with an investor, there was a lot of education required to convince them why this was an opportunity and why they should come on board," CEO Onyekachi Izukanne said.
"I think what we're seeing is that the market is now awake to that opportunity. You have more parties, especially several serious ones coming in and trying to help build this. There's a lot of iteration required to figure out the models that work. And more parties that you find hacking at this kind of speeds up innovation within the space, so that's super useful."
First launched in 2016, TradeDepot has built up a network of 40,000 small businesses in Nigeria and connects them to local distributors of global consumer brands like Nestlé, Unilever, GB Foods and Danone.
These days, the company is venturing into the realm of embedded finance, rolling out digital wallets and financial services, particularly credit or BNPL offerings. TradeDepot is active across 12 cities in Nigeria, Ghana and South Africa (Accra, Johannesburg and ten cities in Nigeria).