Individuals or businesses buying furniture in Africa can purchase from local furniture stores or global furniture retailers like Ikea. But both options have pros and cons; for the latter, local furniture stores may lack the quality that clients need, while global retailers, in addition to taking several months to ship their products to Africa, can be too pricey.
Taeillo, a Lagos-based startup innovating around these issues relating to time, quality and cost via its online furniture e-commerce store, has raised $2.5 million in “expansion” funding from Aruwa Capital, a Nigeria-based early-stage growth equity and gender-lens fund.
In a statement, Taeillo said it is an alternative for customers who incur high costs when they import furniture (combined with an unstable exchange rate) and have to endure long wait periods of three-six months before the furniture is delivered. “… we provide customers with aesthetically pleasing furniture pieces at a fraction of the importation price and with a 50% reduction in delivery time to about 4-8 weeks,” it continued.
Founded in 2018 by Jumoke Dada, the online furniture seller sources raw materials from local suppliers and manufactures furniture pieces, from sofas and beds to chairs and tables, which it sells to individual customers and businesses. The company, which doubles as a manufacturer and retailer, can be likened to Wayfair and now-defunct Made.com. However, because it serves an entirely different market, Taeillo has had to be authentic with its product offerings by infusing cultural elements (it refers to them as Afrocentric furniture).
When Dada launched the platform, its target audience was solely businesses. The initial product brought in $165,000 in seed funding from investors such as CcHUB Growth Capital, Montane Capital and B-Knight. However, in mid-2020, during the pandemic, Taeillo, leaning on investors’ guidance and citing a chance in the market after several walk-in stores halted operations, pivoted to a direct-to-consumer approach.
“It was more or less like opportunity met preparation because, at that time, many people were at home, and the leading furniture brands were not online to serve them,” CEO Dada told TechCrunch. “Traditional showrooms were locked up too, so that was an opportunity for brands like us to position ourselves and prove that they could buy furniture online without necessarily going into showrooms.”
The decision proved a masterstroke; up until its pivot, Taeillo had sold less than 200 pieces of furniture in Nigeria. Its pivot came with the launch of the “Amakisi” table (₦29,999/~$85) — a work table and one of its best-selling products — which quickly gained popularity and sold more than 1,000 pieces in six months. Since then, the online furniture manufacturer and retailer has expanded into 10 additional product categories, moved into Kenya and shipped more than 10,000 pieces of furniture to over 5,000 customers in both countries.
In 2021, Taeillo raised a $150,000 bridge round from CcHUB Syndicate as it tripled its revenue from the previous year. But that growth and progress didn’t come without headaches. Due to the popularity of some of its furniture within the Nigerian millennial and working-class demographic, Taeillo has struggled to meet demand; on various occasions, taking months to deliver products. Though it manages its supply chain to an extent and manufactures about 70% of its products, the startup also relies on third-party manufacturers who make components before they are sent to Taeillo’s warehouse, assembled and shipped to customers. According to Dada, the reasons behind extended wait times — with the company producing as many as 800 pieces of furniture monthly — are due to working with these third-party providers, including suppliers and logistics services.
“Sometimes, as a modern business, you must deal with crude suppliers. But recently, we’ve had to change our suppliers to shorten the time we get the materials. Right now, we’re also working around strategic partnerships with third-party logistics companies and might set up a logistics arm to help us improve our deliveries,” said the CEO on how Taeillo plans to deal with the long delivery times while also admitting that the online furniture manufacturer and retailer could also improve how it handles production.
With the funding, Taeillo intends to reduce delivery times to about three-five days by pre-manufacturing some of its best-selling furniture (for instance, the “Amakisi” table) instead of waiting till customers make orders before starting production. The investment will also help scale its “Pay with Flexi” product, where shoppers can buy furniture and pay in installments; more than 200 people have used it. Then there’s its augmented reality and virtual reality (AR/VR) tech (powering virtual showrooms), which the startup intends to double down on, marketing-wise.
“We’ve done a lot of work with less. So now, we want to get outstanding talent that will take us to the next growth stage. Also, we want to increase our market share, optimize operations, hack our supply chain and ensure that customers have a great experience,” expressed the chief executive of the online furniture retailer, who made over $1 million in annual revenue in 2021.
Adesuwa Okunbo Rhodes, founder and managing partner at sole investor Aruwa Capital, said investing in Taeillo aligns with one of her firm’s investment objectives: backing women founded- and led startups. Last week, the three-year-old growth equity firm, which is one of the few founded and run by an African woman, closed a $20 million+ fund from Visa Foundation and other LPs to invest in 10 startups across fintech, healthcare, renewable energy and essential consumer goods serving the female population.
“In line with Aruwa’s gender lens investing strategy, Taeillo is founded and led by a woman and has a 50% female representation in its management team,” she said in a statement. “… The company [Taeillo] has maintained its innovative model in a traditional brick-and-mortar industry, creating a unique value proposition for its customers in a fast-growing, underserved market. By leveraging technology in its value chain, Taeillo has been able to achieve exponential growth in less than 2 years, achieving results that take traditional furniture companies decades to achieve.”
Pan-African ‘gender equal investor’ Janngo Capital hits first close of €60M fund
Comment