The news is coming seven months after TechCrunch announced that the company, founded in January 2020, took part in Y Combinator’s winter batch that included nine other African startups.
San Francisco-based venture capital firm Global Founders Capital led the seed round. Y Combinator, Hustle Fund, Liquid 2 Ventures, Hack VC and Soma Capital participated, including individual local investors and early backers such as Paga CEO Tayo Oviosu, Remita CEO John Obaro and Magic Fund.
Vendease tries to solve the challenges and inefficiencies in Africa’s highly fragmented food sector, starting with Nigeria. Initially, the company found a sweet spot in a purely decentralized marketplace play connecting suppliers and farms on one side with restaurants and food businesses on another.
When a restaurant or food business places an order, the system generates all the possible suppliers that can fulfill it, looks at the best pricing versus quality and assigns that order to the supplier. According to the company, delivery is made within 24 hours, either by itself or third-party logistics providers.
Still, the company recognized that these businesses needed more quality and operational help. While some complained of delivery times and quality of food supplies, others did not have sophisticated operations to handle them.
Co-founder and CEO Tunde Kara says that this led to Vendease building a series of stacks — logistics, storage, payments, inventory management, embedded finance — to control the movement of food supplies from one point of production to the endpoint of consumption.
his process, according to the CEO, has saved businesses on the platform a ton of money and human capital.
“When we compare market prices to what users buy on our platform, we’ve approximately saved them about $480,000 in the last nine months, cutting a lot of unnecessary expenses from their general costs — savings that can go into other things in terms of expansion and growth.
Kara says the company hopes to 10x this number in the next 12 to 18 months. “Proactively, in our small way, we are helping to grow the GDP for the food businesses both on the farmers and vendor side of the marketplace,” he continued.