Kenyan blockchain and artificial intelligence (AI) startup, Fastagger is banking on Web3 and big data to drive small and medium enterprises’ (SMEs) growth across the country and Africa.

The startup, which focuses improve customer intelligence, combines blockchain and machine learning to help SMEs gain customer insights and engagement data and in turn profitably scale up their businesses.

Fastagger’s target is to present a social commerce platform that provides discounted tokens, while analyzing predictive data to help SMEs make informed decisions to boost their businesses.

According to its co-founder and CEO, Mutembei Kariuki, the startup uses the immense power of data to support African SMEs, which struggle to gather market insights and trends.

“SMEs are the engine that drives the continent. They provide more than 50% of employment and more than 90% of businesses across Africa. And through them, Africa accounts for over 70% of the trillion dollar mobile money market,” he tells NODO News in an interview. “Being a data-first company, we try to find out how we can democratize AI and blockchain in this setting, to help Africa’s SMEs to ensure their customer engagement and in turn benefit.”

Celo, Solana, Ethereum, Cardano and Polygon

(Mutembei Kariuki, co-founder and CEO of Fastagger / Photo by Fastagger)

It currently works with Celo, Solana and Ethereum blockchain protocols in its operations and has plans to also use Cardano, and Polygon, as the future of Web3 goes multi-chain.

The startup seeks to onboard 10,000 SMEs this year, and have an overall of some 100 million SMEs across the continent onboarding it in the long term.

While bigger global companies like Starbucks, Amazon, Target, have access to the latest technologies for conducting targeted customer intelligence, and ensure client engagement, Africa’s SMEs have no access to such technologies, and sometimes end up spamming everyone whose contact details they have, with marketing text messages and emails.

By deploying a blend of AI and blockchain, Kariuki says, Fastagger helps SMEs increase sales and access to finance, through its model of a decentralized mobile-first retail.

“Essentially, we work with the SMEs with a data centric approach. They send their data which is mostly their transaction data for now. We’ve built a script on our side that understands this data,” he says. “It can deduce what the data is all about; whether it’s the prices, the products being sold, or the trends in the business’ markets. This is where machine learning also comes in. It learns these trends and is able to communicate with the businesses. We plan to make it work quite like an AI assistant later on.”

The model, according to him, in the end helps to drive economic development in the continent and improves business stability of SME owners and also ensures their access to finance.

Mobile Money as Africa’s Engine to Power Transactions

Most transactions in Africa happen through mobile money; especially those happening on social commerce. Roughly $700 billion is transacted through mobile money on the continent by SMEs, accounting for about 70 per cent of global transaction values, according to the GSMA.

In social commerce businesses, such as those on Instagram, TikTok and WhatsApp, the payments for products and services are done through mobile money. Though this large amount of money is transacted by SMEs, they still struggle with sales and access to finance.

Many such SMEs that deal in these transactions, similarly, still do not understand the benefits of data and how they can use it to increase their sales and to also access finances.

“In Kenya alone, 1.2 million people buy items on Instagram. And there are about 7.5 million SMEs in the country,” says Kariuki. “We, therefore, want to first go deeper in this Kenyan market with our services, before we seek more funding to scale up and venture out of the country into the continental market.”

Kariuki explains that Fastagger’s business model is quite simple. The startup seeks to allow business people to access their reports and analyses, and pay as little as $2 per week for smaller enterprises, and for the larger ones, up to $50 per month.

“For the coupons, we charge a percentage of the prices of the goods. The ecommerce space, which in the last year alone transacted about $85 billion, presents a great potential which we can leverage.”

For these coupons, Fastagger takes 1% of the value of the coupons created. The coupons also pay 10% of the sale when the tech startup helps them to discover new customers.

Kariuki notes that so far, the startup has had investment from CV VC, and his startup has also been approached by finance institutions such as banks, for partnerships in which its data can be handy for funding SMEs.

Data Literacy Is A Hurdle

There are however challenges in the industry. Data literacy is one of the biggest challenges impacting on Fastagger’s service delivery.

Kariuki says Fastagger is accordingly automating its systems to make it easier for business people to understand how the entire system works and the benefits that it has on their businesses.

The startup also engages in roundtables with the SMEs, interacting with them and getting their views on how they can engage with the platform to address some of their issues.

“There is also an issue of trust among their customers, access to capital to enable the startup to scale up fast enough in terms of technology, and also competition from traditional Web2 platforms that offer similar services,” he adds.

Kariuki, however, says that working with the Kenya Private Sector Alliance (KEPSA) has been beneficial in addressing the trust issue that may exist between Fastagger and its prospective customers.

KEPSA, which has more than a million members, is a widely recognized institution in the country and therefore commands a lot of trust among Kenyans, the more the reason Fastagger is working with it.

-Edited by Shigeru Sato