Kopo Kopo targets digitisation of 1m businesses


Kopo Kopo, which launched in Kenya in February 2012 and enables merchants to accept payments through a variety of electronic methods, is targeting the digitisation of one million businesses through its platform.

Kopo Kopo was incorporated in the United States (US) in 2010 and operates from offices in Seattle, Washington and Nairobi with a team of 45 employees.

The name comes from “kobboh kobboh”, the Krio word for “money”, and stems from the company’s pilot project in Sierra Leone, from which the founders were inspired to create a platform to enable small and medium enterprises (SMEs) to accept mobile payments and build relationships with their customers.

Ben Lyon, vice president (VP) of marketing at Kopo Kopo, told Disrupt Africa the company envisions a world in which merchants can manage their businesses from a single screen.

“Our mission is to digitise one million businesses through electronic payments. Specifically, our platform enables any merchant acquirer to acquire, manage and scale a profitable merchant network,” he said.

“We start by enabling a merchant to accept whatever electronic payment type their customer has. In Kenya, for example, we’ve enabled merchants to accept Airtel Money and Safaricom’s M-Pesa. Once that relationship is established, we start layering on value-added services like targeted SMS marketing, business-to-business payments, and unsecured merchant cash advances. These value-added services create an incentive for businesses to transition from cash and paper to a digital interface.”

Lyon said Kopo Kopo had essentially taken a lesson from the payment card industry and adapted it to suit mobile money in emerging markets.

“Specifically, a successful merchant strategy requires both excellent distribution and best in class software and services. We provide the latter,” he said.

“We’re unique insofar as our platform offers front-end merchant services, back-end ISO/acquirer tools, and lending marketplace logic. We have competitors within each specific category, but not across our end-to-end stack.”

The startup has raised funding from both private equity and venture capital investors in Europe and the US, with its lead investors – Khosla Impact and Javelin Venture Partners – based in Silicon Valley. It currently operates in five markets across Sub-Saharan Africa and plans to be in at least two non-African markets by the end of 2015.

“We’re proud to be a company of firsts. We were the first “merchant aggregator” in the mobile money industry – we partnered with M-Pesa in 2012, for example – and currently manage the largest independent merchant network in the industry. We were also the first payment processor to facilitate unsecured merchant cash advances in East Africa.”

In terms of revenue streams, Kopo Kopo has diversified. It earns a percentage of the merchant discount rate (MDR) whenever a merchant within its network receives a payment, while also making licensing revenue whenever a merchant acquirer buys its platform.

“In terms of revenue, business is good. Our Kenyan entity is profitable and we’re investing heavily in global growth,” Lyon said.

He said Kopo Kopo had experienced plenty of difficulties over the years, but managed to push through and learn from them.

“Challenges have ranged from keeping team members safe to navigating new bureaucracies, cultures, and markets. What’s most rewarding, though, is that there’s never a dull day. We’re always racing to learn something new and stay ahead of the curve.”

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Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.

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