Pivo, the Nigerian fintech that aimed to revolutionize banking services for small businesses and their supply chains, will shut down operations just one year after securing a $2 million seed round.
Founded in July 2021 by Nkiru Amadi-Emina and Ijeoma Akwiwu, Pivo raised over $2.6 million from prominent investors such as Y Combinator, Ventures Platform, and Mercy Corp Ventures.
However, the startup is now shutting down. While details remain sparse, Amadi-Emina, the CEO, mentioned the closure without providing specific reasons.
Pivo entered the market with a unique approach and a focus on supply chain financing. The company offered banking services tailored to small logistics and haulage businesses operating within Nigeria’s supply chain sector.
The startup distinguished itself by providing financing options through its fintech verticals:
- Pivo Capital (a lending product)
- Pivo Business (a business banking product).
Its mission was to address the liquidity challenges Africa’s $41 billion supply chain industry faces.
What was Pivo’s lending model?
Pivo’s lending model primarily targeted:
- Primarily targeting logistics service providers.
- Clearing and forwarding businesses.
- FMCG distributors.
The company enjoyed huge success using this model, disbursing over $1 million in loans within a year of its launch. It claimed an impressive 98% repayment rate by validating transactions with buyers before extending business credit.
However, despite initial success and a substantial $2 million seed round in November 2022, Pivo has decided to cease operations.
Why did Pivo suddenly shut down?
The shutdown of Pivo adds to the list of African startups facing challenges in a tough economic environment. Over a dozen startups on the continent have closed their doors this year, citing various reasons such as economic downturn and funding gaps.
Possible reasons for Pivo’s closure include Nigeria’s dependence on imported products or its struggling transport infrastructure.
Any of these may have impacted the financing landscape for supply chain businesses.
Pivo’s business model, focusing on irregular payment cycles in the supply chain sector, may have faced difficulties in sourcing capital for loans. The neobank concept, while innovative, may have encountered scepticism from businesses used to traditional banking services.
Obinabo Tochukwu Tabansi is a supply chain mastro and writer with a decade of experience working in different facets of the supply chain. Today he is living his passion for writing on all things supply chain. His blog, Supply Chain Nuggets, is Africa’s fastest-rising supply chain blog, helping professionals, business owners, and curious minds navigate the supply chain complexities on the continent.
