Kenyan customer loyalty startup CashBackApp has raised a US$475,000 pre-seed funding round to help scale its service in Kenya and prepare for expansion to neighbouring countries.
Formed in late-2018 by Simon Ngigi, who was later joined by Allan Thiga, CashBackApp helps fast-moving consumer goods (FMCG) companies to build loyalty amongst customers by allowing them to earn cashback via M-Pesa on their everyday shopping. It began operations in 2019.
The startup partners with FMCG companies and retailers, who use the app to reward shoppers with cashback for buying products that they promote on the app. It has achieved significant traction, with the user base growing at a monthly compounded rate of 38 per cent in the first half of 2021 to reach 45,000 downloads.
On the B2B side, CashBackApp has signed up major international FMCGs as customers, including CocaCola, Colgate and Ajab, while the retailer network consists of eight large multi-chain retailers including Khetias, Eastmatt, Mulleys and Jamaa.
The startup has now announced a US$475,000 pre-seed funding round to help scale the service in Kenya and prepare for expansion to neighbouring countries. Institutional investors that invested in the round include Lofty Inc, Sherpa Ventures and Loyal VC, while the round also had participation from several angel investors based in the US, UK, Nigeria and Kenya.
CashBackApp now plans to reach more than one million shoppers by December 2022.
“We are excited to invest in Simon and his team at CashBackApp as they are solving a big problem that affects most middle to low-income households in Africa – how to reduce the ever increasing food and shopping budget,” said Idris Ayodeji Bello, managing partner of LoftyInc Capital Management.