Kippa, a Nigerian startup that uses its financial management and payments platform to help small businesses thrive nationwide, has secured $8.4 million in a seed round that was oversubscribed.

The startup — launched last June by Kennedy Ekezie-Joseph Jephthah Uche, Duke Ekezie received backing from Goodwater Capital, Rocketship VC, TEN13 VC, Saison Capital, VentureSouq, Crestone VC, Vibe Capital, and Horizon Partners.

In sub-Saharan Africa, Kippa is one of the various bookkeeping platforms available to small and medium-sized enterprises. In the sub-Saharan area, suppliers including Pastel, Bamba, OZÉ, and Bumpa are also available.

Prior to the development of such solutions, many of these companies conducted their operations offline, mostly using pen and paper or ledgers, and handled financial management, inventory control, and records of employees and suppliers.

Almost nine out of ten small firms fail within the first five years as a result of all these inefficiencies, which take up time, result in mistakes, and have an impact on cash flow and finances.

As a result, startups have introduced a range of auditing solutions to digitize the processes of these small firms in Nigeria’s conventional retail industry, which is alone worth more than $200 billion.

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Smaller businesses can use Kippa to track inventory, create invoices and receipts, keep records of daily revenue and expenditure, and generally keep records of how their companies fluctuate over time.

According to Ekezie Joseph, from last November, Kippa has over 130,000 active businesses, ranging from little kiosks and street corner shops to neighbourhood food stands and high-end retailers.

Ekezie-Joseph did not specify the number of active small enterprises, despite that the platform has expanded to support over 500,000 of them.

Any business that offers services to thousands of small and medium-sized enterprises throughout different cities in Nigeria has a significant distribution network on which to build new goods.

In Kippa’s case, which has merchants in each of Nigeria’s 774 local governments, it has significantly improved the services it offers to merchants.

Due to the price and difficulties in completing the complete registration process, the majority of small firms in Nigeria are not properly registered.

As a result, First, Kippa just introduced what Ekezie-Joseph called one of the quickest incorporation products for small firms.

Ekezie-Kennedy described his platform’s option to enable these businesses to consolidate legally as, “In addition to the previous Kippa product, we’ve designed another product that allows businesses to register in 3 days for just N15,000.”

The CEO continued, “This functionality serves as the foundation for Kippa’s intentions to stack financial products in addition to gaining substantial traction and increasing revenue.”

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The business revealed last week that it has been granted permission to function as a Super Agent by Nigeria’s top bank, the Central Bank of Nigeria (CBN), just like agency banking competitors OPay and TeamApt.

With the license, business owners on the Kippa platform can operate as agents and provide individual clients who frequently visit their small businesses to make regular purchases with financial services like cash deposits and withdrawals, bill and utility payments, bank account opening, and insurance.

For a startup company growing this quickly—Kippa estimates its annualized transaction logged on the platform has exceeded $3 billion, 10 times what it had last November—getting the finest people to drive its blitzscaling efforts is crucial.

To achieve this, the financial management platform has hired senior executives from companies such BharatPe, OPay, Khatabook, OKCredit, TeamApt, NIBSS, and Unified Payments as well as former regulators.

It is worth noting that credit is the bond that holds everything together, despite that these platforms promote various business strategies such as banking, bookkeeping, software services and connections with suppliers.

Kippa’s credit and lending division, which the CEO had anticipated would be a source of revenue for the startup last year, has been temporarily put on hold for the time being, hopefully not for too long that it interferes with the startup’s goal to become the preferred financial service provider for small businesses.

(Source)