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  Last year, only seven African companies made it to the list of YC’s most valuable companies, including Flutterwave, Wave, Paystack, Reliance Health, 54gene, Yassir, and Nomba. However, this year’s list includes Nigerian freight logistics startup Kobo360, which participated in the summer batch of 2018.
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The list ranks companies based on their valuation from their most recent funding round. Kobo360, a Nigerian freight logistics startup, is ranked higher than Nomba, a Nigerian fintech, and is ranked just below 54Gene. Y Combinator, a global accelerator, has revealed its top companies for 2023. The list consists of public, private, and acquired YC-backed companies with a value of over $150 million. YC’s latest data shows that there are more than 290 private companies and 33 exits worth over $150 million, with over 90 worth over $1 billion, and 16 that are public. Kobo360 raised $20 million in a Series A round led by Goldman Sachs in 2019, as well as $10 million in working capital financing from Nigerian commercial banks. In December 2021, the company raised $48 million in a Series B round of both equity and debt financing, which was led by the Fund for Export Development in Africa (FEDA), the equity arm of Afreximbank. Existing investors such as TLCom Capital, IFC, and Goldman Sachs (Juven), as well as other bank and insurance partners, also participated in the funding round. Despite a successful year in 2019, Kobo360’s operations were affected by the COVID-19 pandemic in 2020, resulting in travel restrictions that impacted the company’s ground operations. As a result, the company made a slight pivot and worked with insurance firms to invest over $4 million in an insurtech product designed to address issues such as the risk of goods-in-transit, driver misbehaviour, and credit default, according to TechCrunch.
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“Most times, your investors and board are present when it is working. When it’s not working, it can get lonely. At one point, I took leave from work and went for some leadership courses to see if I could figure out how to improve my capacity because I felt like I didn’t have enough ability to run the company anymore,”
Obi Ozor, Kobo360 co-founder and CEO, said.
“It is things people don’t talk about; as a founder, there comes a time when we are not the most experienced to run these companies. Some of us actually don’t fit our CEO roles; if we had to be interviewed for our roles, most wouldn’t make the cut.”
Kobo360 has created Payfasta, an embedded finance platform, to address the issue of delayed revenue collection. Through Payfasta, the company has deployed $100 million and has been able to finance truck drivers and partners faster than before. As a result, the company’s nonperforming assets (NPAs) have decreased to 0.8%, profit margins have increased by 240%, and the receivables cycle has reduced by 64% from 138 days to 49 days.
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According to CEO Ozor, Kobo360 initially focused on growth and did not prioritize unit economics. However, as the company delivered cheaper insurance and financing products, it was able to move towards positive unit economics. The company has also shifted towards digital collection processes and created credit wallets for manufacturers to ensure timely payment. The costs of the collection have been passed on to transporters and field operations. Featured Image Source: TechCrunch
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This article was first published on 16th March 2023


Nnaemeka is an academic scholar with a degree in History and International Studies from the University of Nigeria, Nsukka. He is also a creative writer, content creator, storyteller, and social analyst.

Comments (2)

2 thoughts on “Kobo360 Joins The Elite Club Of YC-Backed African Companies”

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  • It’s great to see that more African startups are making it onto YC’s list of most valuable companies. Kobo360’s inclusion is especially impressive, considering that they only participated in the summer batch of 2018. However, I can’t help but wonder what the growth potential is for these companies. Will they continue to grow and innovate, or will they plateau after reaching a certain valuation? And what about the other African startups that didn’t make the list? Are they still viable businesses with potential for growth, or are they struggling to keep up with the competition? It would be interesting to see more data on the long-term success rates of African startups, and what factors contribute to their growth or lack thereof.

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