Startup snapshot: Delivering affordable groceries to South Africa’s townships
Yebo Fresh is a Cape Town-based startup that delivers fresh, frozen and dry groceries to township communities. Founder Jessica Boonstra (42) answers our questions.
1. Give us your elevator pitch.
For over 30 million customers in South Africa, shopping for groceries can be an expensive, time-consuming, unsafe and burdensome activity. They may need to travel long distances to access affordable goods, resulting in long taxi rides, queues, and carrying 40-50kg of goods back home.
Yebo Fresh is a community-driven and technology-enabled shopping service with an innovative business model that saves its customers time, money and hassle by delivering essential groceries at affordable prices. Following recent seed funding, Yebo Fresh is rapidly expanding across the greater Cape Town area.
2. How did you finance your startup?
The initial idea of Yebo Fresh came up during a brainstorm conversation between myself and Professor Stefan Allesch-Taylor, who became our first angel investor in September 2018. After an exciting year of experimenting, optimising and growing, we just closed our second funding round with five additional investors. Our group of investors is great in the sense that they do not only bring capital, but also a wealth of entrepreneurial, technical, and commercial experience and are both fantastically critical and supportive at the same time.
3. If you were given $1 million to invest in your company now, where would it go?
The global tech revolution tends to always hit the ‘happy few’ first, but we believe that online food shopping could be a real solution for a real problem of the mass market. If done correctly it can be more efficient, more affordable and more accessible with fresher products and lower waste than a traditional store. We would love to start a ‘food revolution’ in South Africa’s townships.
The $1 million would be used to expand our infrastructure with more warehouses and drivers, to engage with hundreds of community hotspots and health groups, to open up loads of new areas, to inform and educate customers on the power of online shopping, and to build the tech and hire the talent to enable all of it.
4. What risks does your business face?
Food is a difficult product as it is bulky with generally low margins and it is temperature-, pressure- and time-sensitive. We are very aware of its challenges and despite our combined experience, our team is still learning every day. However, we sadly face another specific risk here: the high crime levels in some South African township areas. We put a lot of effort into keeping our drivers and brand ambassadors safe (such as minimising cash and tracking their live status).
5. So far, what has proven to be the most successful form of marketing?
We have seen great response and excellent conversion on social media: a lot of our customers have smartphones and are active on Facebook, Twitter, Instagram and WhatsApp. However, our most successful marketing tool is our ‘old fashion’ paper shopping form that displays our most popular hampers and is distributed by Yebo Fresh brand ambassadors.
6. Describe your most exciting entrepreneurial moment.
One of the most exciting moments must have been one of the first big month-end runs, where sales had exceeded our expectations and capacity. It was all hands on deck in our then makeshift warehouse, working till late and making (and solving) so many mistakes. It was exhausting, frustrating and exhilarating at the same time because we realised that our concept might really have wings.
7. Tell us about your biggest mistake.
One of the mistakes I have certainly made in the beginning was being overly optimistic and opportunistic in my excitement, jumping on every new idea or opportunity and meeting people to talk about potential partnerships that we weren’t ready for. Bringing our business back down to its core essence and forcing ourselves to focus has made a big difference.