The process of sending and receiving payments in Sub-Saharan Africa’s $1.5 trillion B2B payments market is one where merchants typically use manual invoicing and inefficient processes that burden merchants and cause them to struggle with their business.
Duplo, a B2B payments startup that solves these problems by enabling African businesses to collect payments from their customers and partners and make payments to their vendors and suppliers, has raised $4.3 million in seed funding. The news comes just seven months after Duplo announced its $1.3 million pre-launch investment; in total, the YC-backed startup has received $5.6 million since then Yele Oyekola and Tunde Akinuwa launched last September.
The Nigerian startup went live with FMCG distributors as its first set of customers this January. FMCG distributors can bring retailers into their network on the Duplo platform, collect payments digitally and access real-time information on business performance. Co-founder and CEO Yele Oyekola told TechCrunch on a call that this distributor-to-retailer channel has been a source of viral growth for the startup. “One distributor can serve over 1,000 retailers and get them on board with Duplo. These retailers can also become Duplo customers. And then it becomes easier for us to digitize the way payments move between retailers and distributors,” he added.
FMCG distributors can also track and reconcile payments while automating payments to merchants, manufacturers and suppliers, with instant payments allowing them to transact in larger quantities.
Duplo, meanwhile, now caters to midsize and enterprise finance teams to avoid over-reliance on a specific market. For finance teams, the B2B payments startup automates the generation and processing of invoices, receiving and approving bills, collecting and disbursing funds, and completing account reconciliations. In addition, Duplo integrates directly with accounting and ERP platforms popular with Nigerian businesses, such as SAP, Microsoft Dynamics, QuickBooks and Sage, so payment that goes through Duplo automatically syncs with these platforms in real-time, saving time and costs of finance teams while reducing errors and fraud.
“When we think about payments on the continent or even in Nigeria for example, there is a lot of focus on merchants collecting payments from customers. And from a B2B perspective, what startups help them with is simply collection and disbursement. However, there is huge value in helping them track and reconcile payments in real-time, where we play a significant role.” Businesses can reduce the time spent on administrative tasks such as account reconciliation by up to 50% and reduce costs, related to payments, by up to 85%, according to Duplo.
Although Duplo processes payments for B2B payments within Nigeria, it has recently received requests from some of its customers to facilitate payments to businesses outside the country over the past few months. As a result, the Nigerian startup surveyed 1,000 business owners in Kenya, South Africa, Egypt and Nigeria to better understand their waiting times to receive payments from business customers and partners worldwide. About 44% said they had to wait more than 24 hours; 34% admit it takes up to a week, while 17% say they wait a month and 3% note 30 days as the minimum waiting time.
Duplo said it currently facilitates payments from merchants in Nigeria to other regions such as the US, UK and Europe; Oyekola said settling time varies from 24 to 48 hours. Such product upgrades have seen the number of businesses on its Duplo platform increase by 1,000% over the past three months, while total payment volume (TPV) processed over the past five months has grown by 4,200%, the company claims.
There is room for more growth, Oyecola insists. While Duplo has a robust accounts receivable unit that allows businesses to collect money through cash invoices and virtual accounts, it needs to improve account outcomes, where businesses can schedule payments, set up invoices and generally improve the platform in a variety of ways. of use.
“We are also trying to expand into new verticals,” noted the CEO. “We originally started with the FMCG industry; now we’ve seen interest in the construction industry, telecoms and these large mid-sized businesses and we’ve created the foundation to scale across the continent, hopefully in the next nine to 12 months.”
The seed funding raised to help the company launch new products and expand into new business verticals in Nigeria included participation from investors such as Liquid2 Ventures, Soma Capital, Tribe Capital, Commerce Ventures, Basecamp Fund and Y Combinator and an existing investor Oui Capital.
“The Duplo team has built an incredible suite of products that improve the way businesses make and receive payments from one another,” said Peter Oriaifo, director of Oui Capital. The growth the company has experienced since our initial investment before launching in 2021 has been nothing short of impressive. For this reason, we are thrilled to support Duplo once again.”