In recent times, fintech companies and others have been on the rise with a goal to empower small businesses and Trade Lenda adds to the list.
Trade Lenda is a digital financial service solution supporting small businesses to get quick and affordable access to credit with zero upfront collateral within 6 hours, with request to disbursement time goal in an interval of an hour over the next few months.
Through the fintech company’s data driven credit scoring platform, Trade Lenda leverages on data to evaluate character and capacity, bridging access to quick and efficient finance gaps for millions of small retailers as well as suppliers across emerging markets, starting with Nigeria.
According to PWC MSMEs report 2020 and IFC report 2021, access to finance is a major challenge for MSMEs with a 5 trillion dollar opportunity market across developing economies, with Nigeria representing over $29 billion opportunity market. Trade Lenda is tackling this issue.
The company was founded by individuals who already had their own companies and had experience working in the traditional financial service space. “We have seen how hard it is to access credit opportunities and the significant impact timely working capital brings to the table. Sometimes the different business survival and death of small business is quick timely access to working capital at an average of $1000,” Adeshina Adewumi, co-founder, Trade Lenda pointed out.
The team started off with a micro test through a partnership where over $500,000 was facilitated in disbursement to support trade businesses during the heights of the pandemic. Later in May 2021, the founder decided to extend the company’s solution to a close beta with over $300,000 disbursed to about 500 small businesses and the same fully repaid. “Yes we’ve so far achieved 100% success repayment,” Adewumi emphasised.
“Today, we have gone further to sign up six strategic partnerships which currently gives us a subscribed list of over 150,000 active retailers and suppliers to support with timely working capital and Local Purchase Order invoicing.”
The team of three co-founders include Adeshina Adewumi, a social entrepreneur passionate about the attainment of the Sustainable Development Goals (SDGs) in Africa and the globe. He is an ex Banker and Wealth Management expert from Stanbic IBTC who previously founded One Kiosk and also served as a Venture Partner at Aptive Capital between 2020 and 2021.
On the other hand, Shina Arogundade is an experienced credit analyst having worked for United Bank for Africa for a number of years and wrote credit policies for the bank in 20 African countries. He was part of the team that championed the Credit automation and a first product launched in Ghana and then replicated across 19 other African countries.
Meanwhile, Oluwatosin Ayodele, a full stack Software Engineer who originally studied accounting, was driven to become self-taught by his passion for technology. Over the last eight years, he has developed various solutions individually and as a team with applause from his State as well as at Federal Government levels in Nigeria. He is also a winner of the Kick start Award (season 3) by International breweries — subsidiary of AB-inbev — where he was celebrated for leveraging technology to deepen internet coverage within his community in Osun State Nigeria.
Today, the experts have come together to build the next Unicorn while contributing meaningfully towards eradicating poverty, creating jobs and driving industry innovation through the small businesses supported with the company’s solution.
The Competition
“The competition is very dynamic with most players focusing more on the digital consumer (salary earners) lending even when they claim to focus on small businesses,” Adewumi said. “We have however created a niche for ourselves by focusing on MSMEs especially those within the retail and supply value chain. We must however give credit to other players like Payhippo and Sycamore who are also working to bridge this gap for small businesses.”
The founders’ insights of the market and opportunity can however be traced to their deep insights working with retailers and suppliers to give them access to the market. “We saw the opportunity and decided to be the bridge towards unlocking the dividends of access to finance to secure trade for retailers and suppliers across emerging markets.”
Funding
Since conception, Trade Lenda has been able to cycle over $250,000 in debt from various Angels — friends and family inclusive — at various points while an equity investment of $20,000 was raised through an Angel who also happens to be a former senior colleague while at Stanbic IBTC.
Also, the founders equally brought their contribution in cash and cash equivalent to the table. Officially Trade Lenda has been able to fully disburse and achieve 100% repayment so far. “Today with over 150,000 retailers — online and structured informal markets — signed, we see this as a stepping stone to the next milestone.”
The work of Trade Lenda commenced on its WebApp in May 2021 and within 8 weeks, it had a fully functional platform to support small businesses and achieved quick and prompt access to finance. Adewumi says the company would be rolling out fully within the next few weeks (Q1 2022) once they close their current $1million funding round.
Profits
Trade Lenda makes profit from charging 5% – 30 days interest on working capital credit disbursed to small businesses owners compared to some others who charge between 10-30% monthly with lots of hassles still involved.
Challenges
As second time founders and with the team’s experience, they have a soft landing with little or no issues coming together. “In fact we got our first check of $20,000 even before we officially kicked off based on people who believed in us, our precedence and the vision to bridge the gap for millions of underserved small businesses across emerging markets. They have equally gone a step further to facilitate most of the funds we have cycled into bridging this access to finance gaps for small businesses so far,” Adewumi said in a conclusive statement.
