In Kenya, financing is essential for shops to buy their stocks. However, it is almost impossible for small retailers to get credit. Sevi runs a stock financing platform in Kenya, which enables small shops to buy products on credit from large suppliers, such as Coca-Cola. Sevi is experiencing rapid growth and is poised to accelerate further by deepening partnerships with well-known suppliers in Kenya. This significant and profitable growth allows them to offer attractive returns to shareholders. Learn more about their business model and check out their live round on Leapfunder.

1. Hi Peter. Thank you for agreeing to do the interview. Tell us about Sevi and the idea that got it all started.

Sevi runs a stock financing platform in Kenya, which enables small shops to buy products on credit from large suppliers, such as Coca-Cola. Walter aan de Wiel and Bartel Verkruijssen started the idea. When Covid hit the Kenyan market hard, they saw a need for new digital finance methods, specifically for essential goods in the food and pharmaceutical value chains. In 2021 they won the GDC Innovation Award and the concept was launched as a pilot. Based on the pilot’s success, the product was launched commercially in 2022.

2. What problems are you trying to solve? What are the benefits of Sevi?

Kenya’s retail sector is dominated by small shops, which supply approximately 80% of consumer goods. However, these small shops struggle to access credit due to their informal status, lack of collateral, small transaction sizes, and high default risk. Without available credit, these shops place millions of small orders with large corporations, often relying on limited cash or expensive consumer credit.

This is inefficient and costly for the small shops and their corporate suppliers. For instance, large suppliers must manually process numerous small cash orders, while small shop owners often don’t have all the products on stock their customers are asking for and have to close their businesses to order new stock, wasting valuable time in traffic and incurring high transaction costs.

3. You have a live round on Leapfunder. What makes it the right tool for your startup, and what do you expect from the round?

Leapfunder is a platform where smart angel investors come together to find good angel investing opportunities. We believe Sevi has a strong investment case and therefore offers value to the investors on the Leapfunder platform.

Furthermore, we believe that the convertible works very well for both Sevi and Leapfunder investors.

4. How much growth potential do you see for Sevi?

Since its inception in April 2022, our monthly loan volume has experienced an average increase of 18% each month. The lending volume has grown from €6K in April 2022 to €70K in April 2023, reaching €500K in April 2024 and hitting almost €1M by October 2024, generating about €25K in revenues. In 2024 alone, we observed an impressive monthly growth rate of about 22%. Throughout this rapid expansion, defaults within our portfolio have decreased and remain stable at around 1.4% of the disbursed volume.

This growth has been driven by the referral programs of over 36 large suppliers, including well-known names such as Coca-Cola, Kyosk, Anytime, and Philmed. Collectively, these corporations supply goods to approximately 500K shops across Kenya. Currently, Sevi serves only a small fraction of the small shops that receive their products from these suppliers, highlighting significant growth potential within this existing network. Additionally, our team in Kenya is actively onboarding new suppliers onto the Sevi platform. We believe that Sevi is able to continue on its steep growth curve in the coming years by working with its existing large suppliers and by onboarding new suppliers.

5. What are your plans for the upcoming months? Tell us about your go-to-market strategy and the plan to acquire customers.

Sevi is projected to break even in 2025. We aim to expand our active buyer base from around 3K shops active per month in October 2024 to approximately 16 shops by the end of 2025. At this scale, we expect to achieve profitability. Our new secure, guaranteed payment-on-delivery solutions have made existing suppliers eager to onboard their entire customer bases to Sevi, further strengthening our growth trajectory. We aim to expand our buyer base by working with the sales agents within the large suppliers.

Thank you for sharing Sevi’s story, Peter. We wish you the best of luck.

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