Three years ago, small-scale vegetable vendors in Nairobi’s Kaloleni Estate were excited to learn that someone had come up with a solution that would potentially save them the hustle of jostling for produce at the wholesale market.
Grant Brooke, 31, had made a stop in the city estate to test the reception of a platform he was working on to help urban retailers save time and money in their operations.
After few months, about 80 vendors signed up, with most of them making orders of at least Sh1,000 a day. But as the clientele base grew, so did the need to have a tech-backed platform to ease logistics.
He came up with Twiga Foods, a mobile-based supply platform which today services up to 6,000 orders a week in several estates including Kaloleni, Nairobi West, Lang’ata and Rongai as well as Syokimau and Mlolongo in Machakos.
“We will roll out in Runda in the next three months. We intend to get the whole of Nairobi covered in the next 12 months and move our clients up to 4,000 a day,” says Mr Brooke, a native of Texas, US.
“We self-funded Twiga during the first year. We had to put in a couple hundred thousand dollars.
“We are now are venture capital backed. We have so far received Sh1.2 billion in seed funding.”
Marketplace for vendors
Twiga Foods, which was launched in November 2014, is essentially a marketplace that saves mama mbogas (vendors) the hustle of waking up at dawn to go to the wholesale market to buy supplies.
The firm has depots in several estates in Nairobi from where tuk-tuks (three-wheeler taxis), vans and canters pick the produce, for delivery to Twiga customers.
After this, the application collates the purchasing and ordering data from the vendors it serves and pushes it back to collection points across the country where farmers can book their stock.
“Essentially we work like any other commodities market, except it’s not a marketplace where people go and trade on the floor,” Mr Brooke told the Business Daily at his office in Westlands, Nairobi.
“Rather traders use technology to place orders and book supplies as well as take care of the logistics in between by providing transportation and warehousing.”
Today, the company supplies up to 350,000 bananas a day across the city.
It also supplies onions, tomatoes, potatoes, mangoes and cabbages to the vendors.
“In the next 12 months, we want to go up to the 17 core products that the average mama mboga stocks,” said the economist who spotted the opportunity while handling cargo for a friend in the Middle East.
Mr Brooke says interacting with suppliers and vendors has helped him understand why agricultural commodity prices were exorbitant in Kenya even though the country is one of the largest producers in the region.
“I realised that brokers mess up the prices and that lots of the produce get wasted between the farmer and the market, making farmers incur losses,” he says.
Mr Brooke co-founded Twiga Foods with Peter Njonjo, an accountant. They pooled resources to buy five tuk-tuks to start the product trial.
In July, the company raised $10.3 million through debt and equity, an investment it says will be used to increase the number of vendors it serves daily, diversify its product portfolio and introduce advanced supplier services.
Today, the firm owns 45 vehicles and has 200 staff, mostly tech-savvy to maintain the platform.
However, Mr Brooke declined to reveal the company’s annual turnover due to non-disclosure agreements with its investors, only stating that it is in “millions of dollars”.
“We figured that if we approached vendors with a tech fangled product explaining how it could that would help change their fortunes, we doubt they would be interested,” he says.
“For vendors, we have a 92 per cent customer acquisition rate. The first time we talk to them about our services, they sign up on the platform and they place an order for next day. And they stick on the platform month-to-month.”