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    “It hurt us when the committed capital didn’t fully come through,” Kenyan MarketForce Founders Say as Startup Shuts Down

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    In a candid reflection on their entrepreneurial journey, Tesh Mbaabu and his co-founder Mesongo Sibuti recount the rise and fall of their startup, MarketForce, which just announced its closure. The closure comes after a valiant effort to pivot and sustain the business amidst the tumultuous landscape of the COVID-19 pandemic and unforeseen funding challenges.

    MarketForce, originally established as a SaaS company catering to large FMCGs and Financial Institutions in 2018, found itself at a crossroads when the pandemic disrupted its revenue streams and threatened the departure of its largest client. Faced with adversity, the founders made a bold decision to pivot to a B2B marketplace targeting neighborhood merchants — a move that initially garnered skepticism but ultimately proved fruitful as the startup gained traction.

    “We knew it was a gamble,” Mbaabu reflects, “but there’s a certain bliss in naivety that propels you forward.” The pivot led to significant milestones, including acceptance into Y Combinator and subsequent funding rounds that fueled the expansion of their e-commerce platform, RejaReja, across multiple African countries.

    In just three years, MarketForce expanded its footprint to 21 cities across five countries, creating over 800 jobs and serving over 270,000 merchants. The integrated features of RejaReja empowered merchants to earn more money, resulting in nearly $160 million in gross transaction volume.

    However, amidst the rapid growth and expansion, MarketForce encountered the harsh realities of the venture capital landscape. “We did not anticipate the ‘funding winter’ that struck,” Mbaabu admits. “Venture capital is not for good or even great companies; it’s for those that produce outsized returns at the right time.” Despite committed capital, the startup faced challenges when expected funding failed to materialize fully. “We got this completely wrong, and it hurt us when the committed capital didn’t fully come through,” he says. 

    Reflecting on the closure, Mbaabu acknowledges the painful lessons learned. “Every dollar raised should be viewed as a gift, not the lifeblood of the business,” they emphasize. The experience underscored the importance of profitability and prudent financial management — a sentiment echoed in the evolving landscape of the tech ecosystem.

    The decision to shutter RejaReja was not taken lightly. Despite efforts to make the business model sustainable, including downsizing operations, the founders concluded that continued operations were no longer feasible. Mbaabu describes the closure as “devastating,” acknowledging the sacrifices made by their team and supporters.

    However, the end of MarketForce marks the beginning of a new chapter. Partnering with founders of Chpter — a business focusing on online merchants — Mbaabu and his co-founder are embarking on a new venture centered on social commerce. “Starting again is only made easier when you go back to the basics,” Mesongo reflects. The new endeavor aims to empower merchants through AI-powered conversational commerce, leveraging the rapid growth of e-commerce in emerging markets.

    Chpter, now live in Kenya and South Africa, has already made significant strides in empowering merchants and driving revenue growth across social channels. Mesongo expresses optimism about the future, emphasizing the importance of resilience and perseverance in the entrepreneurial journey.

    “We’ve graduated from a multi-million dollar course in building for the continent,” Mbaabu remarks. “Failure is a part of the journey, but it’s how we learn and emerge stronger.” The founders remain committed to their mission of empowering African merchants and invite others to join them on their journey.

    Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.

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