Millions of small and medium-sized businesses still operate inefficiently due to reliance on manual processes, which limits their capacity to grow and scale; this is despite contribute to approximately 48% of Nigeria’s GDP in the past five years,
But the tide is turning. Over the past few months, we’ve seen a wave of new entrants launching solutions aimed at digitizing small businesses. In the latest development, bumpaone of them who says they are building the infrastructure to enable online commerce and enable African small business owners to start, manage and grow their business from their mobile devices has raised a $4 million starting round.
The company, which announced that $200,000 pre-seed last September, said it plans to use the investment to hire talent, build, structure and scale its processes into new African markets.
Founded by Kelvin Umechukwu and Adetunji Opayele, bumpa plans to use the investment to hire talent, build its processes and structure and scale up to new African markets. It announced a $200,000 pre-seed last September.
The platform’s origin story can be traced back to 2018 when the founders Kelvin Umechukwu and Adetunji Opayele – while running another startup that provided advice for small businesses – built websites for small business owners looking to get online for the first time. Later versions were tailored to Shopify’s image: a simple website builder that small businesses could use without much help.
However, after it gained little traction, it was clear that Bumpa needed to evolve to meet the growing demands of businesses on the platform, including sales and accounting logging, inventory management and customer data storage. It also helped that both founders came from families of small business owners so they could get a first-hand look at these issues.
And as businesses flocked online when COVID hit in 2020, Bumpa went back to the drawing board, revamped its product, and released a new version the following year. With this version, companies can create websites in “60 seconds”, accept payments, manage inventory, handle accounting, fulfill orders and engage customers.
“We are trying to solve the inefficiencies that small businesses face, as most of them have been working in a black hole for the longest time. They don’t have enough data and insights into what’s happening, what’s being sold and how their products are being sold,” CEO Umechukwu said during a conversation with londonbusinessblog.com. “Although many startups try to solve this, we do it differently. We are evolving and we see our features as the foundation of what is possible with Bumpa.”
Bumpa 2.0: Integrating an ecosystem of products
Today, in addition to Bumpa, small businesses in Nigeria are spoiled for choice for products that can digitize their operations, including accounting, invoicing, and inventory management. Some include Pastel, Kippa and OZE.
In August, Bumpa took a move that delivered a message: It approached its relationship with small businesses differently as a retail automation company, not an embedded financial platform.
“I think the ideology and product direction differ between Bumpa and other companies. Most have fintech elements; we’re not trying to be a fintech – we’re in the retail automation space,” said CEO Umechukwu. “In fintech, we don’t try to solve things that have already been solved. There are new things that have not been tested before, such as the Meta integration.”
Bumpa’s integration with Meta allows its merchants to connect Instagram and Facebook accounts to their Bumpa app, receive DMs from their customers, and respond through the Bumpa app. The integration also allows them to share and sell products, share invoices/receipts, record sales, store buyer information and request payments through the Bumpa app while displaying it on their customers’ Instagram DMs. All these transactions take place without the sellers leaving Bumpa and the buyer leaving Instagram.
Several tech onlookers have praised the Meta integration, which Umechukwu believes will take Bumpa to the next stage: bringing various digital solutions essential to the day-to-day operations of small businesses and integrating them into the social commerce and retail automation platform.
“There is so much fragmentation in space. A business owner is likely to use up to 10 solutions, including social media, payments, billing, logistics, and marketplace apps. But none of these solutions communicate with each other,” he said. “We want to be that connecting platform on the continent. The idea now is to bring all these solutions and channels that small businesses use together with the click of a button and basically facilitate the transfer of information for efficiency.”
That said, Bumpa wouldn’t blindly embark on this Herculean task. It will prioritize based on orders and activities completed on the platform. For example, what drove the Meta integration was that 40% of all orders on Bumpa come from Instagram and WhatsApp. And in a subtle effort to bring conversational commerce to more than 50,000 small businesses on its platform, the following integrations will include WhatsApp, Messenger, and Google My Business. The piece is similar to what Charles has in Europe.
However, these integrations are not free. Bumpa has linked them to a subscription to supplement the first income stream: commissions on online transactions. Umechukwu said subscriptions have doubled Bumpa’s revenue from Q2 to Q3 this year. Overall, since its inception, Bumpa has completed over 200,000 orders and registered a GMV of over $20 million.
Base10 Partners, the world’s largest Black-led fund, is the lead investor in Bumpa’s seed round; it is the company’s second investment in Africa after Okra, a Nigerian API fintech. Other participating investors include Plug & Play Ventures, SHL Capital, emerging markets-focused fund Magic Fund, Jedar Capital, DFS Labs, FirstCheck Africa Angel Program, E62 Ventures, Club14 and Fast Forward Ventures.
Fast Forward Ventures’ managing partner Opeyemi Awoyemi said Bumpa is doing what Shopify did in North America for Africa. And referring to why his company is doubling down on the social commerce platform after an initial $30,000 pre-seed check, he said Bumpa “unlocks wealth (and massive GDP) for millions of new and existing sellers.” The company’s operating partner, Omolara Awoyemi, is Bumpa’s chief operating officer.
Meanwhile, Luci Fonseca, a director at Base10 Partners, said in a statement that Bumpa enables e-commerce and reduces friction for millions of SMBs. “The more we spent time with Kelvin and Adetunji Opayele (Teejay), the more we saw that they are very special founders and have a powerful mission to build the defining ecommerce platform in Nigeria and across Africa,” she added .