Caantin, the Kenyan startup that was formerly called Kibanda and then TopUpMama, has led many lives. Backed by Ventures Platform and DFS Labs, Kibanda was digitising the supply chain for small restaurants in Kenya. As TopUpMama, it was helping big hotels and restaurants in Nigeria restock through a digital platform.
TopUpMama had clients like Mr. Biggs and Sheraton Hotel, but it ran into an interesting problem: most companies were fine with using MS Excel to manage procurement. What clients would rather pay for was a dashboard that could give an overview of payment cycles, retention rates, and other relevant metrics.
“The main reason people wanted to use a procurement product was to centralise data. [Caantin’s pivot] is an evolution of that problem,” said Njavwa Mutambo, the company’s CEO.
That customer feedback informed the company’s pivot to Caantin, an artificial intelligence startup businesses can use to analyse and visualise data. “Our software is replacing [the cost of a data analyst],” Mutambo said.
The startup, which employs five people, expanded to America in the fourth quarter of 2023 and now serves manufacturers and logistics companies. Its American customers now generate 75% of its revenue, according to Mutmabo. He added that the startup recorded its highest monthly revenue to date in April 2024.
Its expansion into the United States comes as African startups are pressured to deliver strong performance even as macroeconomic conditions on the continent worsen. Inflation and currency depreciation in key markets like Nigeria and Egypt have reduced disposable income and startups struggle to grow revenue.
“One of my favourite quotes is that it’s easier to make dollars than it is to make naira, and I can approve of that,” Mutambo told TechCabal over a call.
Caantin began targeting the American market because of the high cost of talent in the US. The average yearly salary for an entry-level data analyst in South Africa, Africa’s most developed market, is $16,500, while the same position attracts a $64,000 salary in America.
The startup charges between $15 and $100 for each company’s staff that uses the product and has twelve customers in North America and more than thirty in total.
Caantin pivots from B2B e-commerce
Caantin’s journey to increased revenue has not been smooth. In 2023, when it rebranded from Topup Mama, it laid off more than 90 employees. The rebrand and layoffs were surprising because Caantin had just raised a $1.7 million seed round and claimed it was growing exponentially.
Mutambo described the experience as “difficult,” especially as the startup had to raise a bridge round to continue operations before it became Caantin.
“We were doing millions of dollars of monthly sales but we realised something people didn’t see and it was that the path to getting to positive unit economics for B2B e-commerce businesses was extremely capital intensive and capital is drying up,” Mutambo told TechCabal.
In recent months, well-funded Kenyan B2B e-commerce startups have shut down operations and laid off employees to cope with a drawback in investors’ appetite and profitability struggles. Zumi shut down in March 2023 due to its inability to raise capital despite crossing $20 million in sales, while MarketForce, once valued at $100 million, shut down its B2B e-commerce product in April 2024.
In December, Wasoko merged with MAXAB to establish “a clear e-commerce leader” and laid off 10% of its combined workforce. Both companies raised more than $220 million combined.
“Your job as an entrepreneur is to build the biggest company you can possibly build, especially if you are venture-backed and the way you build the biggest company you can possibly build is by targeting the biggest market you can possibly target,” Mutambo said.
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Copyright for syndicated content belongs to the linked Source : TechCabal – https://techcabal.com/2024/05/27/caantin-pivots-to-us-market/