South African product rentals service Rentoza is planning expansion into West Africa in the next 12 months after banking funding from Khulisani Ventures, the early-stage investment vehicle of the Mineworkers Investment Company (MIC), back in June.
Founded in 2018, Rentoza provides product subscriptions to South Africans for essential items, be they electronics appliances or baby goods. The startup wants to enable people to access such items at affordable rates and with flexible terms, so that they can drive utility from these products without ever having to own them.
“There was no model in the market that existed that delivered access and non-ownership on a pay-as-you-use basis. This is where we saw the opportunity to develop a subscription model for products that gave people the best technology when they needed it to achieve their outcomes and not have to extend themselves beyond their means,” said Mishaan Ratan, co-founder and chief marketing officer at Rentoza.
The startup has grown in the last 20 months by 357 per cent in revenue and 400 per cent in subscriptions, and now has a team of 52 people. Bootstrapped previously, aside from a small amount of funding from Startupbootcamp AfriTech, it is now thinking more expansively after raising ZAR20 million (US$1.3 million) from the Johanneburg-based MIC, a 100 per cent Black-owned Investment Company established in 1995 by the Mineworkers Investment Trust (MIT) to create a sustainable asset base for the benefit of mine, energy and construction workers and their dependents.
Disrupt Africa reported last July the MIC had announced the launch of MIC Khulisani Ventures, a ZAR150 million (US$10 million) early-stage investment vehicle targeting black-owned innovative, high-growth businesses in South Africa. Rentoza is its first investment, and Ratan says the startup will partially use the funds for expansion purposes.
“We are only available in South Africa currently, but we are looking to expand into West Africa in the next 12 months,” he said.
“We have a recurring commerce model so we receive subscription payments monthly. Funding has been our most difficult journey to date, but finding the right resources that can grow with the business is also a challenge, as we require quite specialised resources in the business with the model we have built.”
Either way, with cash now in the bank, the time is now for Rentoza to make its product rental marketplace model work.