{"id":1961,"date":"2022-06-14T09:53:31","date_gmt":"2022-06-14T13:53:31","guid":{"rendered":"https:\/\/newsosv.wpengine.com\/?p=1961"},"modified":"2023-12-05T04:37:37","modified_gmt":"2023-12-05T09:37:37","slug":"from-freshmen-to-founders-with-a-40-million-series-a","status":"publish","type":"post","link":"https:\/\/sosv.com\/from-freshmen-to-founders-with-a-40-million-series-a\/","title":{"rendered":"From Freshmen to Founders With a $40 Million Series A"},"content":{"rendered":"\n

Tesh Mbaabu rarely showed up to his freshman computer science class at the University of Nairobi. His classmate Mesongo Sibuti noticed. A self-described \u201cvillage boy\u201d who hadn\u2019t seen a computer until his first year of high school in 2006, Mesongo wondered what could be more important than school. One day he asked Tesh about his absences. <\/p>\n\n\n\n

\"\"
Tesh Mbaabu, Co-Founder, MarketForce Technologies, Inc.<\/figcaption><\/figure><\/div>\n\n\n\n

Tesh told him he was skipping class to run Teshteq, a web design agency he\u2019d started between high school and college. He\u2019d been raised in Ngong, a middle-income Nairobi suburb; his mother ran a law firm; his father taught veterinary medicine at the university. As a boy Tesh dreamed of becoming a professional soccer player. That changed in high school, where the internet introduced him to Mark Zuckerberg, Larry Page, Sergey Brin, and Bill Gates. Now he dreamed of being an entrepreneur.<\/p>\n\n\n\n

Mesongo had spent high school living with his maternal grandparents, subsistence farmers who raised livestock and grew casava, bananas, and maize in Ntimaru, a semi-nomadic farming community near the Maasai Mara. His mother had died in 2001. Every day after school he tended the cattle. If he was late, his grandfather would make him fetch firewood. Discipline was key to survival in Ntimaru. Silicon Valley was the last thing on Mesongo\u2019s mind. But after seeing that PC at school, he pursued computing studies relentlessly. As a senior he scored high enough on a national college exam to earn a computer science scholarship. He would pay the equivalent of USD $260 per year for tuition at the University of Nairobi.<\/p>\n\n\n\n

Which brings us up to the meeting of Mesongo and Tesh in freshman computer science. They both liked to sit in the back of the classroom\u2014\u201cbackbenchers,\u201d they called themselves. Tesh asked Mesongo if he\u2019d be interested in helping with Teshteq. Mesongo said yes; he wanted to make enough money to buy his own laptop. So while Tesh skipped class to find clients for Teshteq, Mesongo worked on Teshteq projects and made sure Tesh didn\u2019t flunk out. <\/p>\n\n\n\n

The friends graduated in 2015 and are co-founders of MarketForce, a retail distribution platform that raised a $40 million Series A in February 2022. MarketForce enables Africa\u2019s informal merchants to order inventory digitally with 24-hour delivery times. <\/p>\n\n\n\n

As college sophomores, Tesh and Mesongo phased out Teshteq and launched Mesozi Group, a software consulting firm that Tesh called their \u201ccash cow.\u201d They implemented projects for companies and government agencies, got paid, and then invested the returns into building digital startups. <\/p>\n\n\n\n

While Tesh skipped class to find clients for Teshteq, Mesongo\u2026 made sure Tesh didn\u2019t flunk out.<\/p><\/blockquote>\n\n\n\n

Some of these ventures failed spectacularly. For example, frustrated with the slow, bureaucratic tendering process for government projects, Tesh and Mesongo launched a procurement automation tool. \u201cThat went horribly wrong,\u201d says Mesongo. No one in procurement wanted a transparent, digital process that would limit opportunities for graft. Tesh and Mesongo were learning the pitfalls of building technology without understanding your customer. Still, says Tesh, \u201cSoftware consulting gave us a front row seat into different industries and the kind of digital transformation that we’re looking to see in organizations.\u201d <\/p>\n\n\n\n

One of those industries was retail. In Sub-Saharan Africa, informal merchants\u2014picture small stands with groceries\u2014account for an estimated 90 percent of retail sales. Consumer packaged goods (CPG) manufacturers distributed their goods to these merchants through local sales agents, who took orders with pen and paper. The merchants suffered frequent stockouts because the ordering process was slow and shipment ETA\u2019s were unreliable.<\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Tesh and Mesongo started MarketForce to digitize transactions between CPG manufacturers, sales agents, and merchants. The manufacturers were induced to pay for MarketForce because it would reduce the difficulty of getting goods to African consumers. <\/p>\n\n\n\n

Tesh and Mesongo began to doubt MarketForce\u2019s model. \u201cIt didn\u2019t feel like we were helping suppliers enough,\u201d Tesh says. They figured essential goods would reach consumers whether or not MarketForce facilitated the process. The merchants, not the suppliers, had the most to gain from retail distribution technology.<\/p>\n\n\n\n

\u201cWe saw a very big opportunity,\u201d says Tesh, \u201cto enable merchants to live better lives by accessing these goods conveniently and on time, ensuring they’re not losing revenue from stockouts.\u201d With a fast-growing population of 1.14 billion people, Sub-Saharan Africa represented a significant retail market where mobile devices were increasingly widespread.     <\/p>\n\n\n\n

MarketForce pivoted its business, leading to the launch of RejaReja (Swahili for \u201cretail\u201d) in December 2020. It is a digital marketplace where merchants order inventory with next-day delivery for thousands of SKUs. They can also use RejaReja to resell digital services, like mobile phone credits, opening new revenue streams.<\/p>\n\n\n\n

Mesongo says he appreciates the lessons from SOSV mentors about how to organize teams, track performance and design a scalable business. \u201cThose are important things that you need to know before you fail in doing them.\u201d<\/p><\/blockquote>\n\n\n\n

After raising a $2 million pre-Series A round in the summer of 2021, MarketForce needed to accelerate RejaReja\u2019s growth. Marketforce was accepted into SOSV\u2019s Chinaccelerator program that summer. Tesh and Mesongo started working remotely with SOSV\u2019s William Bao Bean and Oscar Ramos, who set weekly targets for growing their user bases. \u201cI loved that accountability throughout the program,\u201d Tesh says. By summer\u2019s end, MarketForce had expanded to 18 towns in Kenya and launched in Nigeria. Tesh and Mesongo are on track to build the largest retail distribution ecosystem in Africa. More than 200,000 merchants in Kenya, Nigeria, Uganda, Tanzania, and Rwanda use RejaReja to procure inventory and offer digital services.<\/p>\n\n\n\n

Mesongo says he appreciates the lessons from SOSV mentors about how to organize teams, track performance, and design a scalable business. \u201cThose are important things that you need to know before you fail in doing them,\u201d he says. \u201cAnd the best way to know these things is to talk to people that have seen other entrepreneurs go through the same journey.\u201d <\/p>\n\n\n\n

\"\"<\/figure>\n\n\n\n

Tesh and Mesongo have adopted a Pan-African ethos rather than a winner-takes-all mentality. \u201cI believe there is enough room in the market for several big players,\u201d says Tesh. MarketForce uses the term \u201cpeer\u201d rather than \u201ccompetitor\u201d to describe other companies in their space.<\/p>\n\n\n\n

Both men still live in Nairobi. Tesh, a husband and a dad to a toddler, is an adrenaline junky who enjoys whitewater rafting, bungee jumping, skydiving,<\/strong> and paragliding. Mesongo, also married, prefers more grounded activities like tennis, swimming,<\/strong> and running. Mesongo says he still eats like he\u2019s living on a farm, with boiled sweet potatoes as his staple, and pokes fun at Tesh for his habits. \u201cWhen we travel,\u201d says Mesongo, \u201cI am always trying out local stuff, and Tesh just eats fries and meat.\u201d<\/p>\n\n\n\n

Tesh refers to their market as \u201cthe continent.\u201d He and Mesongo, he says, \u201cconnected as people who love technology, love commerce, and love the continent of Africa.\u201d<\/p>\n\n\n\n

<\/div>\n\n\n\n

By Richard Ellis
Photos by TraibFilms and MarketForce<\/p>\n","protected":false},"excerpt":{"rendered":"

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