I like to tell anyone who would listen that they should watch the space of food technology over the next decade, African food technology will be the new African Fintech.
Tunde Kara
Food logistics are essential because of the economic impact of the food supply chain, which is important for a number of reasons. For starters, farmers want to sell their goods as fast as possible and get paid, while consumers want to buy food at fair prices.
Africa’s supply chain ecology evidently requires complete reform in order to remain relevant in the developing global economic order, with over 40% of food lost between fields and markets and two-thirds lost in the first mile.
Small farmers continue to be traditional and have weak market integration. The middleman in food supply networks is restaurants. However, Vendease, a food marketplace, is changing the narrative.
In an interview with TechEconomy, Tunde Kara, the CEO and co-founder of Vendease speaks on the potential of Africa’s foodtech and how Vendease is leading the charge to disrupt the food logistics sector in the region.
TE: Give a brief description of Vendease
Tunde Kara: Vendease is a three-year-old food-tech company that provides a platform that helps restaurants run their daily operations as efficiently as possible. Our biggest and most popular product is the e-procurement or the Vendease marketplace, where restaurants can buy all of their supplies directly from food manufacturers, and get them delivered within 12 hours or less.
The platform also provides access to financing options or credit facilities, they can also track and manage their procurement processes on the platform. We also run a suite of other products that help other back office functions like management, online inventory management, payment options that can help payment channels, and the ability to track the cost efficiency of each plate of food that they serve. This way, they know if they are making a profit on every plate of food that is served.
Essentially, what we started Vendease for and what we are growing into is to be that one-stop platform that ensures that the flow of food from the point of production to the point of consumption is as efficient as possible. So essentially, if you ask what it will be like when we reach our full potential, my answer will be when we get to the point where every single day, 1 Billion plus Africans will have Vendease pass through their table at least once a day.
TE: You pivoted your operations pattern months after launch. Can you explain the market conditions that prompted this?
Tunde Kara: Pivots within the company have helped solve certain logistics issues. We moved from a pure marketplace that only connected restaurants to food manufacturers to a controlled marketplace, which has enabled us to control the entire marketplace, including the price and quality of products.
Essentially, what I must talk about is that, first of all, we needed to control pricing and quality better. We also needed to control availability and delivery times better. In-house, we want to ensure that our users get exactly what they request.
TE: What is the goal of your current business strategy?
Tunde Kara: As we evolve and create different products, while also getting the current product into as many hands as possible, the point of Vendease’s growth is to, at some point, be end-to-end in Africa’s food supply. This will involve facilitating the supply side of things and helping the demand side of things, so it is like automating that flow from the point of production to consumption.
Everything we’re building is geared towards helping or making the flow of food, from production to consumption, as efficient as possible. This will be achieved by reducing waste and increasing efficiency.
TE: How does your business strategy stand out from other food logistics startups in the country?
Tunde Kara: If you look at other food tech companies or food logistics companies, there’s nobody who’s tackling this problem or looking at it from an end-to-end point of view. We were the only ones who would decide to get our hands dirty and get into the supply chain side of things, as well as the back office software side of things.
You notice that most of the time, people pick and choose what size they want. Although it sounds like lots of walks, we are proving that you can actually do them. We do all this because foodtech has huge potential. Although the infrastructure in most of Africa, especially sub-Saharan Africa is almost non-existent for what we do and that’s what has created a lot of underdevelopment in the foodtech sector, we still have testimonials or businesses who have been our platform over the last three years and have scaled from one shop to multiple shops or multiple outlets. We are already proving that what we are doing works.
As I said, when we efficiently ensure that food flows from the point of production to the point of consumption, it unlocks a lot of value and will increase and grow the food economy in general. Businesses are joining the platform and they are expanding because of the efficiency of services, access to financing, etc. They can grow from one outlet to multiple outlets or a bigger chain.
TE: Vendease was recently recognized by the World Economic Forum 2023 as one of the top 100 Technology Pioneers. What does this achievement mean to the startup?
Tunde Kara: It is a big honor for us because there are hundreds of thousands of startups in the world, and we were chosen as one of the top 100 globally. I think in Africa, there were just six or seven of us.
Aside from the recognition, it also exposes us to the global stage of conversations when it comes to food supply, technology, and sustainable food sourcing. This is a big deal for us because it recognizes that, in terms of pushing the boundaries of technology for the future, Vendease is one of the companies that are at the forefront of leveraging technology to solve these problems.
TE: Still on external recognition. You raised $30 million in a series A funding in 2022. A $30 million series A round is something we are used to seeing with fintech startups, but you achieved it in spite of the downturn in VC funding. Does this create any pressure, given the current global ecosystem?
Tunde Kara: No, it doesn’t. I’ll explain why. I like to tell anyone who would listen. They should watch the space of food technology over the next decade, African food technology will be the new African Fintech. This is because you cannot, not eat. Food is an essential part of our everyday lives so we can not do an opportunity cost for food. No one buys clothes instead of food.
The more technology companies and founders realize the potential in the foodtech market and unlock value here, the more support the sector will receive. So we are privileged to have investors who understand how big this is, and what we are doing. And to be honest, what we are doing is just a drop in the ocean. So yeah, there’s no pressure because we understand that this is just the beginning.
The pressure to perform for us is an internal type of pressure. It is a pressure that comes from excellence from us internally, where we have set this huge goal of automating Africa’s food supply and being in the top African cities within the next five years.
There are no external pressure on us because when you put it in context, we are still playing small games. By the time all of these starts to mature properly, all the stuff you’ve heard so far from Vendease and other foodtech companies will dwarf a lot of these things.
TE: What are your expectations for Nigeria’s food logistics market?
Tunde Kara: I believe food technology is the next frontier for tech founders in Africa or technology investors in Africa. Because like I said, you cannot delegate. Africa has a young population that is growing very fast. Within the next two decades, we need to figure out how to feed about 2 billion people, consistently and efficiently, daily.
Even now, over 700 million Africans eat outside of their homes, every day. What COVID-19 showed us is that our typical African kitchen in the big cities is not equipped to provide food at scale in their houses by themselves. And so by the second week of the shutdown, everybody was looking for online avenues to order food. This is understandable because we go to work very early and come back very late at night. Several Africans barely have the time to make their own meals. Seeing as we have a growing population of young people that will reach 2 billion in two decades, we need to begin to figure out how we are going to feed them efficiently. Africa’s food infrastructure is not set up to feed even 1 billion people.
TE: What challenges have you faced in the market so far?
Tunde Kara: When we traveled around with investors from all over the world, in the Middle East, the US, and Europe, we actually realized that the problems of quality supply, efficient supply, problem of access to credits to fund this supply and access to data to make intelligent business decisions need to be solved in Nigeria.
Having said that, Africa’s issues are even more, because we also have an infrastructure problem. Just starting your business alone is a miracle. Running the business for four years is also a miracle because you have to literally either invent stuff from scratch yourself or figure out how to go around the system to make your business efficient. For instance, Lagos has one of the worst traffic situations in the world. Yet, we are able to do 12 hours or less delivery in Lagos. Why? We have to be inventive about how we go about our logistics.
These are the kind of inventions that African startups have to do in general, not just Vendease. You have to figure out how to provide electricity for yourself at scale; you have to figure out coaching, and supply because you don’t have those. You have to be inventive about how you get the right stuff and how you retain the right stuff.
There is also the financing issue. Before the availability of data for the sector, banks would not partner with the food sector. Banks are now beginning to get more open about partnering with us to provide credit facilities in the sector.
TE: What do you like the most about your team?
Tunde Kara: I like to say that there’s nothing impossible. All you need is time and the right people. So people are very important to me. The right people will find the money. What I like about Vendants, is that we run the company based on our philosophy. We see ourselves as a colony of ants. One ant is insignificant, but a colony of ants can literally move the world. I’ve seen documentaries where ants ransacked a whole village.
So we run on that same philosophy, and that has worked for us. Three years ago, this company was founded by four co-founders. Now we have almost 300 staff. It is a big factor for us that we are a colony of ants and that we can move the world together. And what I like about us is that every single Vendean believes this, and it shows in the diligence of how we work, in the camaraderie of how we relate with each other.
I think that every person who has passed through our doors (both ex-staff and current staff) has experienced that togetherness. And to be honest, no matter whether you are with us now or have left, I still see everybody as a member of the colony. Of course, if you bring people together, there’s always going to be squabbles or misunderstandings. But genuinely, every single person, no matter whether you left great or not, we still see you as a member of the family.
TE: Finally, what should we expect from Vendease in the coming years?
Tunde Kara: We want to get our products into the hands of hundreds of thousands of businesses, figure out more ways to help automate the food supply, and expand into several other countries within and outside Africa.
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