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SA startup Sxuirrel has secured R2.4-million in seed funding from an undisclosed investor.
The startup — which is based at Stellenbosch incubator Launchlab where founders Michael John Dipppenaar, Henri Bam and Michael Louis developed a peer-to-peer storage and space solution — made the announcement yesterday.
Dippenaar, who is also CEO, revealed that the deal — which was signed two weeks ago — had been over three months in the making, after the startup was approached by the investor that took an interest in the “disruptive effects” of the platform, which the three launched last year. Dippenaar declined to name the investor.
The deal will see the investor — who is said to have interests in storage, logistics and the transport industry — take a minority shareholding in the startup.
Dippenaar said the funding would help the startup to expand, cover marketing and operational costs and bank roll product and platform development, adding that the startup has set its sights on “disrupting” storage and long-term parking.
Sxuirrel will use the R2.4-million investment towards expansion, marketing, product development and to cover operational costs
At present the company is partnering with insurance company SureStart which will see the startup offer low premium cover to its clients.
The idea behind the startup came about in 2015, he said. “We identified the problem first hand as students at Stellenbosch,” he said referring to how he, along with co-founders Henri Bam and Michael Louis, could not find flexible affordable storage.
Following the launch last year of a beta version of the app on the Apps Store, the platform today has between 400 and 450 users.
Dippenaar said since the launch of the beta version of the app the company has however generated only about R40 000 in revenue — by charging a commission for each transaction it facilitates on the marketplace. He pointed out that fees range from between seven to 15% of the transaction depending on duration and amount charged.
He said the biggest challenges the business has faced have been to source the right technically-able employees, develop an effective market strategy and get to grips with better time management, as one of the founders is still studying.
Last year the startup won a R20 000 prize at Launchlab’s Ideas Programme and followed it up earlier this year by being selected as one of the six winners of the Attacq Smart Cities Innovation Challenge, winning a share of R100 000 as well as incubation support of up to R80 000 from Launchlab.
Dippenaar said Launchlab has been instrumental in networking and helping the startup acquire customers. “They are great for the early startup phases and during ideation,” he said.
Featured image: Sxuirrel founding team (from left to right ) — CTO Michael Louis, CEO Michael-John Dippenaar and COO Henri Bam (Supplied)