Nigerian Fintech Startup Duplo Closes $1.3 Million Pre-Seed Funding


Over the last few years, startups in Africa’s B2B e-commerce and retail space have pushed to employ technology to digitize processes.

While many companies are focused on transporting things and providing credit, concerns like cash overdependency have yet to be addressed on a large basis.

Here’s why this is such a serious issue. Traditional distributors use a network of agents to collect money as they move items from manufacturers and suppliers to retailers.

Following that, these agents from various parts send lump-sum payments into a central bank account.

 

The majority of fraud occurs behind the scenes as a result of inefficiencies in distributors’ manual reconciliation processes.

The logical thing to do would be to hire an accountant, but in the FMCG industry, where margins are razor-thin, that isn’t an option.

In a word, inefficient operations in the FMCG business — which is predominantly cash-based – cost time, resources, and customers.

Duplo, a fintech firm in Lagos, is seeking to address these inefficiencies by digitizing payment flows for B2B businesses, beginning with those in this sector.

Yele Oyekola, a former product lead at Carbon, founded Duplo as a result of his work as an economic policy officer for the United Nations in Africa, where he saw firsthand how individuals and businesses were overly dependant on currency while travelling several nations.

“We’re trying to make cash obsolete in Africa. “For obvious reasons, a lot of businesses in the distribution space heavily transact in cash.”

As a result, we’re concentrating our efforts on distributors, merchants, and aggregators to eliminate the usage of cash in this value chain, because everyone understands how costly cash is and how difficult it is to move with concerns like theft and fraud.”

Distributors can use Duplo to build individual virtual accounts for retailers and agents to make real-time payments or bank transfers, and the platform will automatically reconcile their books.

However, in the FMCG market, there is no such thing as a one-size-fits-all solution. Because bank transfers are costly for certain businesses and agents, they prefer to do transactions using mobile money agencies.

Duplo is unconcerned about this because shops can still use mobile money agents to make transactions to these identical virtual accounts; reconciliation is then performed.

Every transaction carried out on Duplo’s platform is subject to a 1% fee. Businesses also pay between $100 ($0.20) and $1,000 ($2.00) to open virtual accounts, depending on their size.

There is a no-code solution for B2B enterprises to maximize trade with their business clients, vendors, and suppliers, in addition to products that enable B2B companies to automate their payment flows.

The platform also provides a dashboard to attribute payment flows to a certain customer, store, or region, as well as the ability to issue or pay invoices, offer credit to their business customers, and extend credit to their business customers.

Duplo was accepted into Y Combinator in November and is currently a part of the accelerator’s current winter batch.

To accelerate its expansion, the YC-backed startup has raised a $1.3 million pre-seed round led by Oui Capital, an early-stage pan-African venture capital firm.

Customers reported cost savings of more than 12% during the three-month pilot phase, according to the firm, which debuted it three months ago.

Duplo has also increased by 60% month over month to service over 20 enterprise companies. Currently, it has processed over $380,000; however, by the end of Q2, Duplo hopes to have reached $40 million in yearly TP.

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