Grace Ashiru
Because of a lack of digitalization and sub-optimal business practices, eighty percent of Nigeria’s forty million micro, small, and medium enterprises (MSMEs) struggle to survive beyond their fifth year. Pastel is a company that three graduate students founded at Stanford University.
These students, Abuzar Royesh, Olamide Oladeji, and Izunna Okonkwo, are attempting to find a solution to this challenge through their company. They just finished raising $5.5 million for that purpose.
TLcom Capital, a pan-African VC firm, led the charge in raising $5.5 million for the seed round of funding for Pastel.DFS labs Plug and Play, Global Founders Capital (GFC), Ulu Ventures, Golden Palm Investments, and Soma Cap participated in the funding effort. The firm had raised a pre-seed round of 620 thousand dollars in 2021.
Pastel positions itself in the market as a provider of solutions for business management. It was in school that its founders first connected, and it was there that they realized they had a desire to alleviate the difficulties faced by small enterprises in developing economies. The value of micro, small, and medium-sized enterprises (MSMEs) in Nigeria, for example, is estimated to be over $200 billion; as a result, the three individuals concentrated on Nigeria’s growing MSME industry. For example, the value of micro, small, and medium-sized enterprises (MSMEs) in Nigeria is estimated to be over $200 billion; hence, the three individuals concentrated on Nigeria’s growing MSME industry.
They made their debut as SabiCash in the Nigerian city of Lagos, which is also the location where they introduced their flagship bookkeeping app.
SabiCash is now called Pastel, and it lets small businesses keep a close eye on transactions, manage customers, look at cash flow, and deal with debt. Pastel’s objective is that by putting small businesses online and digitizing their operations, they will be able to remove the obstacles that are connected with time-consuming and antiquated bookkeeping practices.
Okonkwo says that more than 100,000 merchants signed up for the Sabi bookkeeping app by the end of 2021. The app already has more than 45,000 active merchant users.
Quick Receipt is an easy-to-use invoicing and receipt application developed by Pastel. It currently has more than 60,000 active users. Pastel Financing is another product developed by Pastel, a division of Pastel whose primary mission is to serve micro, small, and medium-sized businesses with innovative digital financial solutions.
The Swift Money app, which is now in development at the company, is one example of such a solution. When launched, the Swift Money app will focus on digitizing the Ajo system, a popular traditional savings scheme in Nigeria.
Okonkwo, when asked why the company decided to embrace a multi-app strategy rather than creating a super app, as is more customary with their competition, replied the following to TechCrunch: We planned to gain traction as early as possible by easing a merchant’s suffering through the provision of a simple and cost-free solution. The following stage was to actualize the value. As a result, we improved the Sabi app by adding the value capture features that our users adore. We are making a lot more now.
The way we’ve been approaching it is this: rather than developing a “super app” like a lot of other fintech companies already have or are working toward; we’re going to focus on something else. We are adopting a more platform-based strategy, which means that any user of Pastel can register an account with any of our other apps. They can access all our solutions with the same login information.”
In a statement shared with TechCabal, Pastel stated that it would use the money received to extend its product offerings for small and medium-sized enterprises in Africa by developing new features and capabilities revolving around group savings and loans, and payments.
