Start-up: SureGifts, Nigeria
SureGifts is a Nigerian start-up offering gift cards that can be redeemed at various online and offline stores in the country. It also offers a wedding registry and is targeting corporate gifting, in addition to friends and family.
The company was launched in January 2014 by ex-Rocket Internet employees Babafemi Lawal, Olaoluwa Samuel-Biyi and Adeoye Ojo. All three co-founders had held various positions at Jumia, a leading online retailer in Nigeria.
How we made it in Africa speaks to Ojo about SureGifts’ financing, growth potential and challenges.
1. How did you finance your start-up?
We got seed funding from both local and international investors such as Africa Angels Network and Venture Garden Group, as well as some angels.
2. What risks does your business face?
Cultural adoption (although negligible since we’ve not observed this in other markets). The concept of gift cards is almost entirely new here, and we’re the first to really attempt to market its [use]. As with any new product, there’s a clear risk that the market will simply not accept it, either because the existing systems are functional enough, or because the timing is wrong. But we believe the existing way of gifting is flawed, and that it’s time to do something about it.
3. If you were given US$1m to invest in your company now, where would it go?
We will use the capital to expand to new markets. We think Ghana is interesting because of certain similarities with Nigeria, and believe it should be relatively easy to roll-out there. South Africa is also a great prospect because it’s a ready and more advanced market for a product like ours.
4. So far, what has proven to be the most successful form of marketing?
Direct marketing to key contacts at big corporations.
5. Describe your most exciting entrepreneurial moment.
It has to be when we sealed our first big corporate sale. It was a Fortune 500 company in the US rewarding its employees in Nigeria with about $10,000 worth of gift cards, about six months after we launched. It was big for us and we really needed that sort of validation to stay in the game.
6. What has been the biggest mistake you have made in your start-up, and what have you learnt from it?
Raising funds only when you most need it [has been one mistake]. In fact, capital adequacy at all times is necessary for growth and stability.