2022 has just started and African startups are closing million dollar deals from venture capital firms and angel investors. One of such startups is Kenyan fintech Zanifu. Founded in 2017 by Steve Biko and Sebastian Mithika, Zanifu provides short-term stock-financing of up to $2,000 to MSMEs in Kenya. Techawk had an exclusive interview with CEO Steve Biko. He told us how he co-founded Zanifu, raised the latest funding and plans for the fintech startup. Excerpts
What prompted you to establish your startup? What is Zanifu’s value proposition?
As cofounders, we met & worked in an early stage fintech (Kopo Kopo) & observed the gap for small businesses to access working capital. We provide access to unsecured working capital to MSME’s in the FMCG supply chain.
What has the reception of Zanifu been like since it started?
The reception has been immediate & positive underpinning a need left unserved by traditional finance in the continent.
As a fintech and payment gateway, you have many competitors, how will you say Zanifu stands out from others?
We focus on our customers & provide a service/product that has a direct & measurable effect in their lives & their business.
Fintechs are really giving the traditional banks a run for their money and forcing them to innovate. What do you think about this and do you think fintechs will some day take over the duties of banks?
Fintechs are able to innovate because they can move faster & focus on the customer problem, unencumbered by legacy structures that slow down banks. The banks that recognize this & empower their teams will eventually reinvent themselves & find a place in the new world, the ones that don’t will die a death of a thousand cuts, slowly but surely.
How do you make money?
We charge fixed fees on the working capital we provide. These fees are structured around how much money the MSME’s make & can afford to pay.
Capital and funds are key to starting a business? How did you go about funding Zanifu?
As founders, we bootstrapped, kept our day jobs & managed to fund the early days from our salaries, we worked nights & weekends until we were able to stand up a machine that was humming, allowing us to take the full time plunge.
How did you go about raising this new funding?
Like everybody else, we did the work. Hit the fundraising train & talked to many investors until we found a fit. Our growth forced us to go to market & look for funding to fuel the growth. Important to note, we had found product market fit, were generating revenue & had a clear proof of concept before we looked for institutional capital.
How did Zanifu fare during this coronavirus era?
It was ideally tough, but the resiliency of the African MSME & our team, underscored by support from our investors saw us make it through the pandemic & grow the business by more than 5X.
Many startups fail in their first five years. What measures are enshrining to ensure that Zanifu is here in the next five, 10 and 20 years?
Not resting on our laurels, focusing on the customer & innovating around how to delight them. Also, focusing on finding the right team members to drive the company into “default alive” mode, will be a key point in determining the future of the organisation.
What are the challenges of running your startup? What are your future plans?
Finding the right combination of people, finding the right kind of capital & staying the course through adversity. We are looking to expand to new markets & deliver our solution to MSME’s across Sub Saharan Africa.
What advice do you have for budding entrepreneurs?
Do the work, educate yourself everyday & always reflect backwards to ensure the path forward is on course. The most important thing is, never give up, never give up, never give up!
