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Maad raises $3.2 million in seed funding

Maada B2B e-commerce startup based in Senegal, has secured $3.2 million in debt financing to fuel its growth in the West African country and explore new opportunities in the broader Francophone region.

The seed round was led by Ventures Platform, with participation from Seedstars International Ventures, Reflect Ventures, Oui Capital, Launch Africa, Voltron Capital and Alumni Ventures. He raised $900,000 in debt from French DFI Proparc and local banks.

Maad’s end-to-end distribution platform enables informal retailers (moms and thrift stores) to source fast moving consumer goods (FMCG) directly from partner suppliers, solving key issues they face including inventory shortages and high inventory costs brought about by more level traders.

Sidy Niang (CEO) and Jessica Long (COO) launched Maad in 2020, initially as a data collection service provider before turning to building software that helps companies manage their own internal distribution. How FMCG suppliers used software to solve distribution challenges inspired the September 2021 launch of B2B eCommerce.

“We were inspired by watching our customers use our software for their own distribution. The software provided a lot of value, and we could imagine much more value if we put all the products that small stores buy on the same platform,” Niang told TechCrunch.

Customers place orders through the startup’s call center, field agents or the app, which accounts for the majority (75%) of orders, which are then fulfilled from its warehouses and using an in-house delivery service to reduce costs and ensure consistency of its service.

“We decided to include all the logistics…the reason we do it is because it’s a low-margin business. We believe this is how we can provide good service and meet our clients’ needs for reliability. I don’t think we could offer a similar service if we relied on a third-party service provider,” said Long.

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The startup has grown to serve 6,500 active merchants through its network of 80 vendors and claims to have reached a monthly GMV of $3 million. Maad says that working closely with suppliers has given him exclusive access to certain products and competitive prices for items, which attracts informal traders. These retailers are an important channel for manufacturers to sell products while shipping 80% household retailers in sub-Saharan Africa because of their proximity to customers.

Startups like Maad are also collecting data on products and traders to come up with insights that help suppliers make better business decisions, while solving inventory and financing challenges for informal traders.

Maad raised the funds at a time when investors continue to shy away from backing B2B e-commerce businesses in Africa due to their low margins and capital-intensive business model, which has forced entities such as Wabi, Wasoko and MaxAB reduce, and the like Zoom in and YC alum RejaReja from MarketForce to close. This is after the sector experienced a funding boom in 2021 and 2022.

The startup, which claims first-mover advantage in Senegal, is now planning to expand its coverage to include remote locations in the country and wants to enter a new market within francophone regions by the end of the year. It also plans to introduce a buy-now-pay-later (BNPL) service to allow shop owners to access stock on credit.

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