Past the WhatsApp storefront: Day 1-1000 of Sharesell

On daily basis for a month, Reward Olaoluwa confirmed up at Eko market, the cluster of Balogun and Idumota markets on Lagos Island, one among Nigeria’s business hubs. 

To not promote something. To not pitch anybody. Simply to be there – to eat lunch with the merchants, share dinner, rejoice birthdays, purchase a bottle of whisky when somebody added one other 12 months. 

He was attempting to know how these companies breathed: how they purchased, how they offered, and the way cash moved by means of their palms every day.

Then he seen one thing. Each time he confirmed up, somebody requested the identical query, nearly jokingly: “Have you ever include cash for us?”

It occurred as soon as. Then once more. And once more. Totally different merchants, the identical query. 

“It didn’t occur as soon as. It didn’t occur twice,” Olaoluwa says. “There have been totally different individuals who had been asking. Have you ever introduced cash for us to do enterprise?”

That was the second every little thing clicked. Sharesell, the inventory-backed working system for small and medium-sized companies (SMEs) that he had been constructing and rebuilding since 2022, lastly had its reply.

Day 1: A market no person wanted

Sharesell didn’t begin as a lending firm. It began as a market.

The thought emerged from observing a enterprise mannequin that had quietly gone mainstream in Nigeria: WhatsApp distributors. After WhatsApp launched its Standing characteristic in 2017, casual sellers turned it right into a 24-hour shopfront, posting merchandise for a 24-hour shopfront and fielding orders by means of direct messages. 

Then the COVID-19 pandemic hit. With individuals caught at residence and looking for earnings, promoting on WhatsApp turned one of many lowest-friction choices out there.

Behind the scenes, nonetheless, the provision chain was chaotic. A purchaser locations an order. The seller calls the provider to examine if the merchandise exists. The provider ships to the seller. The seller ships to the customer. No monitoring. No visibility. Fixed delays. 

“The entire course of was fragmented,” Olaoluwa says.

He constructed a market to repair it: a platform connecting suppliers with resellers. Distributors might choose a product, add their margin, share it on social media, and let Sharesell deal with fee, settlement, and supply. It was clear, easy, and logical –  at the very least Olaoluwa thought so.

The one downside was that the distributors didn’t suppose that they had an issue. “They had been okay with having to succeed in out manually to suppliers by themselves,” he says. “They had been even okay going into the markets to purchase objects and resell.” 

What Sharesell had constructed was, in his phrases, a vitamin — helpful, however not pressing. No person wakes up in ache for a vitamin.

Day 500: Going again to the drafting board, twice

After the primary model stalled, Olaoluwa and his co-founder, Osamudiamen Imasuen– a childhood buddy of over 20 years who initially joined to design the UI earlier than changing into co-founder – shifted focus to the suppliers. If the resellers didn’t really feel the ache, perhaps the suppliers did.

They rebuilt the platform for retailers:  importers and main distributors working in markets like Eko. They provided shopfronts, logistics instruments, and stock administration methods. The suppliers engaged with it. However engagement wasn’t retention. 

“They didn’t come again to it as they need to have,” Olaoluwa says. Stock methods solely work if up to date usually. Miss per week or a month, and the information turns into unreliable. The behavior breaks.

A part of the issue was cultural. These had been companies that had saved gross sales books by hand for many years. Convincing them to digitise was not only a product downside; it was a behaviour change downside. 

“You’ll be able to perhaps penetrate, however the resistance goes to stay there whether or not you prefer it or not,” he says.

That’s when Olaoluwa put down his laptop computer and went to the market himself, daily, for a month.

What he discovered there modified every little thing. The suppliers weren’t scuffling with stock software program. They had been scuffling with money. Banks requested for collateral they didn’t have, and the mortgage phrases didn’t match their gross sales cycles. Conventional banking was constructed for corporate-style companies and had largely left them out.

“These guys, whereas the necessity was legitimate, had been marginalised,” he says.

Sharesell turned a lending firm.

It took 9 months of conversations to shut the primary credit score companion. When Sharesell did, they secured a $4 million line of credit score. Throughout the first week of launching Pulse — their lending product — over 400 companies had certified for loans. 

“The demand was greater than the provision we had at that time,” Olaoluwa says.

However that they had discovered one important lesson early: don’t give money. When a few of these enterprise house owners acquired cash straight, it had a bent to go towards different issues — a renovation, a second spouse, pressing household wants. 

As an alternative, Sharesell collateralises every mortgage in opposition to the stock or asset it’s buying. A enterprise submits what they want. Sharesell buys it on their behalf and delivers it. The mortgage is secured in opposition to one thing actual, and if compensation fails, the stock may be recovered and resold.

That perception—financing tied to items, not money—is the backbone of what Sharesell is at present.

Day 1000: Distribution is every little thing

Sharesell is now a staff of 10, cut up between Lagos and Kaduna, the place the engineering staff is predicated. Olaoluwa shuttles between each however stays nearer to Lagos as a result of that’s the place the suppliers are, the place the companions are, and the place the offers get performed. 

“You’ll be able to’t sit in Kaduna and be doing enterprise in Lagos,” he says.

The corporate is bootstrapped, initially funded by the founders’ financial savings and crypto beneficial properties from 2018 to 2020, and later topped up by an undisclosed friends-and-family spherical. 

Exterior fundraising has been on the radar since 2023, however when the funding local weather turned chilly, they made a deliberate determination: construct towards profitability first. 

“I’m attempting to optimise for productiveness,” Olaoluwa says, “slightly than for elevating.”

That very same shift in considering has modified how Olaoluwa leads. Within the early days, he and his co-founder had been obsessive about the product — constructing, iterating, transport. The market was secondary. 

“We didn’t have interaction the market early sufficient to make sure that is how they wish to work together with the product,” he says. 

Now he describes himself as distribution-obsessed. The product is the staff’s job. His job is to be within the room—the assembly, the pitch, the handshake—as a result of visibility compounds, and other people do enterprise with individuals they like.

Two telecom corporations are presently in talks to white-label Sharesell’s enterprise instruments into their very own merchandise. If that goes by means of, Sharesell’s options would attain tens of millions of SME clients without delay—an viewers no quantity of fundraising or advertising might replicate. It is usually why Olaoluwa says overtly that he would welcome an acquisition. 

“There is no such thing as a amount of cash we might increase that may assist us ship that end in actual time,” he says. “If a bigger participant can get our product into the palms of extra individuals, I’m good.”

Nigeria’s casual financial system accounts for round 85 to 90% of Gross Home Product (GDP). It’s huge, deeply entrenched, and largely undigitised. Olaoluwa is clear-eyed about what it is going to take to alter that. 

“Collaboration is what would really assist us develop quicker,” he says. “If bigger gamers within the ecosystem had been to purchase smaller gamers, the consequence would begin to compound.”