Nigerian online grocery store Pricepally has successfully secured $1.3 million in seed funding, with support from investors such as Samurai Incubate, SOSV, ELEA, Hi2 Global, Chui Ventures, and former Unilever executive David Mureithi. This funding round, which follows the startup’s 2021 pre-seed round with participation from Samurai Incubate, positions Pricepally among a select group of African food e-commerce startups, including Yebo Fresh in South Africa and Terraa in Morocco, that have garnered investment in the current year. Venture capitalists are showing continued interest in the sector despite some scaling back.
Pricepally plans to utilize the funding to expand its operations beyond the current three cities it serves in Nigeria. The startup aims to reintroduce group buying, aligning with its commitment to making food affordable for consumers. With a focus on enabling same- or next-day delivery through its digital channels, including an app and a WhatsApp chatbot, Pricepally operates fulfillment centers within its current cities but outsources delivery services.
Founded in 2019 by Luther Lawoyin (CEO), Deepak Bansal (CTO), Mosun Lawoyin (CXO), and Jummai Abalaka (COO), Pricepally addresses the rising cost and unpredictability of food prices exacerbated by inflation. By directly sourcing fresh produce from contracted farmers and packaged food from manufacturers, the startup negotiates prices, ensuring affordability. Luther Lawoyin emphasizes the importance of transparency in their operations, highlighting the removal of middlemen layers as a key factor in offering fair prices.
Pricepally’s business model focuses primarily on retail buyers, constituting 70% of its customer base, as they pay upfront, are cost-effective to acquire, and offer higher margins. The startup’s commitment to transparency has contributed to its steady growth in customer accounts and high retention rates, with over 80% of revenues coming from existing buyers.
Leveraging its sourcing strength, Pricepally aims to address Nigeria’s food insecurity challenge, bringing transparency and visibility to the market. The reintroduction of online group buying is anticipated to further accelerate the startup’s growth by allowing retail customers to pool together and access wholesale prices. Additionally, Pricepally aims to attract new customers through its recently launched WhatsApp chatbot, April, targeting the mass market in Nigeria, a country with high WhatsApp usage.
Rena Yoneyama of Samurai Incubate commends Pricepally’s execution ability and perseverance in overcoming challenges in the Nigerian e-commerce landscape. The startup’s emphasis on improving service quality, customer satisfaction, and trust-building has resulted in healthy unit economics and continuous business growth.
