Chowdeck, Nigeria’s on-demand delivery service, has secured $2.5 million in seed funding to optimize its operations and support expansion into more cities across the country.
According to a statement from the company, the seed funding round includes investment from YCombinator, Goodwater Capital, FounderX Ventures, Hoaq Fund, Levare Ventures, True Culture Funds and Haleakala Ventures.
Other participants in the round are Simon Borrero and Juan Pablo Ortega (co-founders of Rappi – Latin America’s largest online delivery platform), Shola Akinlade and Ezra Olubi (co-founders of Paystack, Sudeep Ramani (Sportybet), Ayo Arikawe (Thrive Agric) and Karthik Ramakrishnan (Amazon).
Since launching in October 2021 after the COVID-19 lockdown in Lagos, Chowdeck has acquired more than 500,000 users and more than 3,000 riders (typically earning the same as senior civil servants in Nigeria) that serve eight Nigerian cities (Lagos, Abuja, Ibadan, Port-Harcourt, Ilorin, Benin City, Abeokuta, and Asaba), the firm said .
It noted that this new funding will enable the startup to double down on its market leadership in these cities and lay the groundwork for further expansion into other Nigerian cities.
The food delivery industry in Nigeria today boasts several players including the likes of Glovo, FoodCourt, ChopTown, and many others.
Commenting on the fundraising, CEO and co-founder of Chowdeck, Femi Aluko, said:
In his comments, one of the angel investors in the round, CEO and co-founder of Paystack, Shola Akinlade, said:
Expressing confidence in investment made in Chowdeck, Partner at Levare Ventures, June Angelides, said Chowdeck is addressing a large and complicated problem, especially in Africa, delivering goods at record speed.
Driven by a combination of increased smartphone and internet penetration, improved payment systems, evolving consumer preferences, and a range of other factors, there has been significant growth in on-demand delivery services in Nigeria in recent years.
For example, heavy traffic in major cities makes it challenging for people to shop for groceries, meals, or other goods, increasing the attractiveness of delivery services that can save time. This growth trajectory is poised to continue as many of the challenges that hampered previous attempts at providing on-demand delivery services are fixed.