NIGERIA – Alerzo, a B2B e-commerce retail startup based in Ibadan, Nigeria has announced a US$10.5 million Series A round led by New York-based Nosara Capital, report Techrunch.
FJ Labs and several family offices from the U.S., Europe and Asia, including Michael Novogratz’s, participated in the round.
The proceeds from this Series A round will be used to expand geographically to northern Nigeria. Alerzo also plans to launch AlerzoPay, the company’s cashless payments and lending platform, as well as a portfolio of new business support services.
In total, Alerzo has raised more than US$20 million since its launch. Early investors include the Baobab Network, an Africa-focused accelerator based in London, and Signal Hill, a Singapore-based fund manager that participated in its US$5.5 million seed round last year.
The company also said it closed a US$2.5 million working capital facility to serve its customers.
Adewale Opaleye founded Alerzo in 2018 as a last-mile distribution platform that helps retailers stock inventory directly from manufacturers. Its business, officially launched in 2019, is centered on helping street-side vendors and shops in Nigeria’s south-western cities access household supplies quicker and efficiently.
Apaleye said he started Alerzo to empower the millions of women who are the backbone of consumer commerce in Nigeria’s US$100 billion informal retail sector.
Alerzo’s core business distributes FMCG goods using a first-party relationship platform which allows suppliers to clear inventory faster and lets Alerzo control the supply chain and delivery.
Given the lack of trust in the marketplace and the requirement to pay on delivery, Opaleye says this was the most inclusive business model where the economics made sense for the company.
Alerzo claims to have built up a network of up to 100,000 small businesses, 90% of which are women-led. The company exclusively serves the country’s tier-2 to tier-4 cities in Southwest Nigeria — Ibadan, Ekiti and Abeokuta, to name a few. It connects retailers to local and multinational distributors of consumer brands, like Unilever, Nestlé, Procter & Gamble, Dangote, and PZ.
About one-third of the total retailers on Alerzo use the platform monthly. According to its website, retailers can order products via SMS, voice and WhatsApp and deliver them to their stores in less than 10 hours. The company claims to have processed over 1 million orders this past year.
Alerzo owns and operates its full-stack tech-driven supply chain and logistics to process these orders. The company provides warehousing and fulfillment solutions to suppliers and storefront delivery to informal retailers. It currently owns over 200 vehicles and 20 warehouses to serve its thousands of customers.
Alerzo has an office in Singapore that the CEO says serves as a regional hub to identify best practices among similar high-growth businesses operating across Southeast Asia and India and adapt them to the Nigerian market. Likewise, to expand its digital footprint, the company recently launched an office in Lagos.
