Kippa,a Nigerian startup receives a $3.2m pre-seed for its small business finance management app

Millions of small businesses around the world have operated offline over the past decade, especially in emerging markets. As a result, most of them still rely on pens that use pen and paper or a list to store and store important information.

In Nigeria, some people keep information on their head. All of these failures, except time consuming, are mistakes and take their toll on financially and financially, causing nearly 9 out of 10 small businesses nationwide to lose money in the first five years.

Nigerian startup Kippa, which seeks to improve the lives of small businesses with a financial management app, has raised $ 3.2 million in pre-seed revenue. The launch of the new fundraising program was led by Berlin-based VC Target Global. Entrance Capital, Alter Global and Rally Cap Ventures are other participating VCs.

More Angel Investors – Babs Ogundey, CEO, Kuda; Khatabook investor Sriram Krishnan; Raffael Johnen, CEO, Auxmoney; Chris Bauer; Cain Casiri; Edward Suh of Goodwater Capital; And Sajid Rahman – invest in this startup.

Kippa works as a simple app that allows small business owners to track daily income and expenses, create invoices and receipts, manage inventory, and more. and often monitor the decline in their activity over time.

One of the most important features of the app, according to the company, is to help retailers track their invoices and send automatic alerts. The company claims that traders using Kippah in this way “pay their bills 3 times faster.”

Most of these features are required to access the platform at various companies in Nigeria. But the idea is to introduce them to credit and other financial services. There’s a bad tradition for this, co-founder and CEO Kennedy Ekezie told TechCrunch.

Most small businesses operate on a cash basis and over 30% of their sales come from credit. So, in fact, the biggest problem for businesses is not lack of storage or equipment, but lack of working capital or loans.

“What we do is have a unique opportunity to provide financial services to our clients. For most of them, Kippa is the first B2B SaaS application they use,” said the CEO who created the company with Duke Ekezie and Jephthah Uche. “And we have a unique opportunity to help them engage in digital online payments, raise funds, save digital money, and connect them to the financial ecosystem.”

Over the past year, many companies have started to cater for the different needs of small businesses and startups with different terms and commitments. Some want to manage their finances, some want to match vendors and small businesses, and others want to provide financial services and software.

But in reality everything converges towards a point which gives access to credit. While this is true, CEO Ekezie said, Kippa “is choosing the digital race over following the digitization of the analog process that previous vendors have done.” According to the founders, this is what sets the company apart.

Currently, Kippah is free for commercial use, so credit reports and other financial services allow businesses to earn money by deducting interest rates or interest rates from their loan or fund accounts. rolling.

The Bill and Finance app claims to have grown an average of 126% month-over-month since its launch in June. With more than 130,000 businesses actively using the app, from small kiosks and retailers to local grocery stores and wholesalers, Kippa is looking to raise more than $ 300 million in the past five months.

For key global markets, these indicators reflect the strong demand for Nigerian raw materials. It is therefore a good reason to invest. According to Lina Chong, Chief Marketing Officer of the company, “Our investment in Kippa will allow Kippa to grow and become the premier financial management solution for small businesses in Africa. ”

Ekezie and his co-founders launched Kippa in February 2021. Prior to Kippa, the trio created Africave, a software intelligence comparison platform, in 2019 and closed last year.

According to Ekezie, they left Africave after recognizing an export ban that would limit the company’s growth. The director said designers are trying to solve other issues that they believe are best for their strengths.
Kippa was born after starting a tour as a developer and met many small business owners from all over Nigeria to understand their plight.

“What we’ve seen is that a lot of people work with the list and spend over an hour at the end of the day reviewing their books, making mistakes, deleting and complaining about the information. are incomplete. ”Ekezie said.
“And we saw a bigger problem that small businesses face: lack of credit or financing. So we think it’s a good enough problem to solve.”

The group also spoke with developers and some members of similar manufacturers from other emerging markets such as Khatabook in India, Treinta in Colombia and BukuWarung and Bukukas in Indonesia to understand how they are growing their business.
And while there are some similarities, Ekezie believes he and his team have altered the Yom Kippah yarn to fit the needs of Nigerian businesses. For example, Khatabook and other actors are digitizing their priorities and stored priorities, while Kippa talks about having financial problems.