TruStory
Sevi is a promising FinTech startup operating in the Buy now, Pay later space. Sevi offers an innovative app designed to empower small entrepreneurs in Kenya and Uganda. The app enables small shops and kiosks to purchase stock on credit from their suppliers and pay later, once they have sold their inventory. This provides much-needed access to appropriate and affordable credit, allowing these businesses to grow and thrive.
Sevi was founded by two Dutch gentlemen called Walter aan de Wiel and Bartel Verkruijsen. It is their strong belief that providing affordable finance to entrepreneurs is a crucial condition for further growth of micro and small companies, contributing to economic growth and a dignified life for entrepreneurs, their employees and families. They are of the opinion that merchant finance based on real orders and delivery is the best way to loan to low-income clients because it limits default risks. They hold the belief that using new digital technologies can unleash the full potential of this model.
Walter is a strategist and doer. He has co-founded 10 social enterprises in Ghana, India and the Netherlands. He has also supported many other startups. Bartel has 17 years of experience in the field of entrepreneurship, IT and telecom. He is a full stack developer & Tech lead. His quality lies in the design, development and validation of proof of concepts.
People: Sevi operates a lean staff, currently employing 47 people (30 women) in Kenya. Its broader impact is to its customers and the people they serve. Sevi achieves greater impact indirectly as it improves the likelihood of survival and growth of SMEs leading to lower unemployment within Kenya. 33% of small sellers on Sevi’s platform indicated they were able to hire 2 additional employees within a year. Directly, most shop owners are entrepreneurs and Sevi currently serves 55% female entrepreneurs (SDG 5) and their business ambitions.
Quote from Sellers:
“The credit management system of Sevi is great to measure buyers’ ability to pay. We have increased our sales due to extension of credit services through Sevi” – Kim Ndirangu Gathuku, Philmed
“Sevi helps me by pre-financing the stock of the micro-entrepreneurs that purchase milk at my business. This enables me to maintain a healthy distribution of my products as it reduces transaction risks and costs.” – Simon Omeno, milk distributor, Lato milk
“Business is booming, my sales agents can pay milk supplied, on time and without delay.” – Suleiman, Mt Kenya milk distributor Nairobi Region
Profit: Sevi is a promoter of financial inclusion by providing access to affordable finance to MSMEs which contributes to economic growth (SDG 8 and 9.3). Further, digitalization of order management services provide insight, prevent fraud and overleveraging, improve credit scoring, increase efficiency, decrease cost, risk and transport movements.
Sevi’s story highlights the ability of technology solutions to lower costs, particularly financing costs for small shop owners. Because of its growth and therefore the availability of more data, Sevi’s AI model is increasingly accurate in predicting both ability and willingness to pay. The innovation is impressive as the solution offered by Sevi is deployable at all levels in a value chain including the last miles where units are smaller and typically would incur higher management costs to offer credit services. Ordering and credit is now one seamless digitized process for many businesses in Kenya. Sevi is characterized by its innovative approach, high-end technology, and the potential it holds to revolutionize the financial landscape for small entrepreneurs in Kenya and beyond. The company plans to attract additional debt funding from other funds in the near future, with the goal of further expanding its on-lending capacity and reach.
The model has gained significant traction and is growing approximately 160% per month. Last year the company grew x10 and also this year a 10x is expected. Loan volume disbursed per month is currently EUR +700k (may 2024). Sevi will grow its market further in Kenya to reach break-even in 2025 and then scale to neighboring countries. As an ongoing process Sevi will enhance its credit scoring algorithm and machine learning. Sevi also aims to add a growth tool to its platform to help small entrepreneurs to further grow their business. Sevi contributes to SDG 9.3 in the area of financial inclusion, with a strong focus on female entrepreneurs. In the coming years Sevi will do long term impact research to assess its impact contribution and enhance its proposition to even serve small entrepreneurs better.
Sevi aims at continuing to stretch its solutions by scaling up its existing sellers and launching partnerships with local financial institutions.
The challenges Sevi is faced with are related to:
The solution provided by Truvalu: