Kapua social commerce startup, emerging from stealth today and raising $8 million in seed funding, hopes to help ease the burden of buying food for Kenyan consumers, many of whom are struggling with skyrocketing food prices.
Kapu founder, Sam Chappattean ex-Jumia executive, said that since its inception in January this year, the startup has built a b2c e-commerce service that enables consumers to shop for groceries at lower prices, across online and offline channels.
The startup is now expanding its network of local agents where consumers can place orders. It will soon also support WhatsApp orders. By sourcing directly from manufacturers and producers, Kapu enables group buying of groceries and claims to help consumers save 30% on spending on fresh produce and packaged consumer goods.
“People spending 40 to 50% of their household income on the grocery basket is a major problem for society, but it also presents a huge opportunity… The reason we started Kapu is that we think there is a more relevant model of e-commerce is one that can be built to target the shopping basket, which is the bulk of spending for the vast majority of consumers. And if we can bring efficiencies through the use of technology, we can have a huge impact on society for consumers and businesses,” Chappate told ukbusinessupdates.com.
The Seed round was co-led by Giant Ventures and Firstminute Capital, with participation from Founder Collective, Base Capital, Norrsken (Klarna co-founder Niklas Adalberth’s fund), and Raven One. They join Kapu’s early backers, including India’s Meesho and Brazil’s Facily co-founders, and a number of African family offices, Twitter’s Biz Stone, Supercell’s Ilkka Paananen, Monzo’s Tom Blomfield, and serial entrepreneur Alexander Rittweger.
Kapu says it has so far set up 1,500 agent collection centers across Nairobi and will work in its next growth phase to fully penetrate Kenya’s capital before expanding into new markets.
Kapu’s agents, usually positioned in residential areas, take orders and deliver the next day.
“Customers receive a message from Kapu and also from the agents to pick up their goods. Many agents will also deliver to consumers’ homes,” said Chappate.
Kapu said the offline channel (via agents) and online direct-to-consumer (via WhatsApp) models are designed to suit this market, where e-commerce has yet to take off, but social commerce is showing signs of potential.
According to Global Web Index’s 2020 Social Media User Trends Report, Kenya reportedly has one of the highest percentages of monthly WhatsApp users in the world. e-commerce continues post-Covid.
Kapu joins the growing list of startups digitizing casual retail in Kenya, including Tushop, which launched last year to enable group purchases of fast-moving consumer goods (FMCGs) through agents and WhatsApp.
Tommy Stadlen, founder of Giant Ventures, who also led the pre-seed round, said: “By using technology to save people money on everyday goods, Kapu will enable millions of households across Africa to invest in education and health. The Kapu team has the unique experience to solve this problem.”
