Maad raises $3.2 million amid turmoil in Africa’s B2B e-commerce sector

EarthSenegal-based B2B e-commerce startup has raised $3.2 million in debt financing to support its expansion in the West African country and explore latest opportunities in the broader French-speaking region.

The seed round was led by the Ventures platform, with participation from, amongst others, Seed stars International Ventures, Reflect Ventures, Oui Capital, Launch Africa, Voltron Capital and Alumni Ventures. It raised $900,000 in debt financing from French DFI Proparco and native banks.

Maad’s end-to-end distribution platform enables informal retailers (mom and pop stores) to source fast-moving consumer goods (FMCG) directly from partner suppliers, solving key issues they face, including out-of-stocks and high inventory costs attributable to multiple tiers dealers.

Sidy Niang (CEO) i Jessica Long (COO) launched Maad in 2020, initially as an information collection provider, after which began constructing software to assist corporations manage their very own internal distribution. The way FMCG suppliers used software to deal with distribution challenges inspired the launch of a B2B e-commerce business in September 2021.

“We were inspired by watching our customers use our software to self-distribute. The software provided a lot of value, and we could imagine much greater value if we put all the products purchased by small shops on the same platform,” Niang told TechCrunch.

Customers place orders through the startup’s call center, field agents or apps, accounting for almost all (75%) of orders, that are then fulfilled from the startup’s warehouses and use an in-house delivery service to cut back costs and ensure consistency in ordering its services.

“We decided to maneuver all of the logistics… The reason we’re doing that is just because it’s a low-margin business. We imagine that in this fashion we will provide good service and meet customers’ reliability needs. I do not think we’d give you the option to supply an identical service if we relied on a third-party provider,” Long said.

The startup has grown to serve 6,500 energetic retailers through a network of 80 suppliers and claims to have achieved $3 million in monthly GMV. Maad says working closely with suppliers has given it exclusive access to certain products and competitive product prices, which attracts informal retailers. Retailers provide a crucial channel for manufacturers to sell products as they arrive 80% household retail sales in sub-Saharan Africa because of proximity to customers.

Startups like Maad also collect data on products and retailers to attract insights that help suppliers make higher business decisions while solving inventory sourcing and financing challenges for casual retailers.

Maad has raised the financing at a time when investors proceed to shrink back from supporting B2B e-commerce corporations in Africa because of their low margins and capital-intensive business model, which has forced the likes of Wabi, Wasoko and MaxAB to reduce operations and likes Zumi and RejaReja of YC MarketForce to shut. This happened after the industry experienced a financial boom in 2021 and 2022.

The startup, which claims first-mover advantage in Senegal, now plans to expand its reach to distant locations in the country and desires to enter a brand new market in francophone regions by the top of the yr. It also plans to introduce a buy now, pay later (BNPL) service to permit store owners to access inventory on credit.