Pivo, the Nigerian fintech startup catering to small supply chain businesses, is closing its doors a year after securing a $2 million seed round. The decision to shut down was confirmed by an insider familiar with the situation, although further specifics were not disclosed at this time.

Amadi-Emina, the CEO and co-founder, communicated the closure, expressing willingness to share more details at a later stage.

Established in July 2021 by Nkiru Amadi-Emina and Ijeoma Akwiwu, Pivo specialises in providing banking services tailored for small-scale logistics and haulage enterprises within Nigeria's supply chain sector.

Following its launch, Pivo secured a $100,000 pre-seed funding from investors like Microtraction, FirstCheck Africa, and Rally Cap Ventures. Subsequently, in November 2022, the startup raised a $2 million seed round with plans to expand into East Africa. Amadi-Emina had indicated that these funds would be utilized to introduce new payment-focused products, addressing a significant challenge faced by SMEs in the supply chain.

Nkiru and Ijeoma of Pivo Africa

Both Amadi-Emina and Akwiwu possessed considerable experience within the logistics industry before establishing Pivo. Notably, Amadi-Emina had founded Jalo, an on-demand delivery company acquired by Kobo360 in 2018. When Pivo was initiated, they encountered no direct competitors within the supply chain sector.

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Pivo's Objective and Operations

Pivo aimed to alleviate the liquidity issues prevalent in Africa's supply chain by offering financing solutions to businesses operating in logistics services, clearing and forwarding, and FMCG distribution. The market size for supply chain financing in Africa was estimated at $41 billion the previous year.

The startup operated through two key fintech arms: Pivo Capital, focused on lending, and Pivo Business, providing banking solutions for enterprises. Pivo claimed to have disbursed over $3 million in loans within a year via Pivo Capital and processed more than $4 million through Pivo Business.

To mitigate risk, Pivo validated transactions before extending credit, ensuring deals were legitimate and securing payment commitments from buyers. This approach reportedly resulted in a 98% repayment rate, showcasing the effectiveness of their validation strategy.

Pivo's shutdown adds to a growing list of African startups ceasing operations in the face of economic challenges and funding difficulties. Over a dozen startups have closed down this year, indicating the challenging landscape faced by African startups amid economic constraints and funding gaps.