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Venture capital company Kalon Venture Partners and retail solutions company the Smollan Group SA have increased their stake in SA shopping community SnapnSave to over 50% with a new funding round totaling R7-million.
The current tranche forms part of a R14-million round in funding committed by the two investors in August last year.
SnapnSave’s app facilitates discounts for shoppers on their favourite products, wherever they shop, just by snapping a photo of their till slip. Three months ago the startup helped shoppers to redeem its one million till slip.
SnapnSave CEO Mark Bradshaw confirmed to Ventureburn today that the deal was closed last Wednesday (31 October).
The latest round follows a funding round last year in which Kalon and Smollan each pledged to invest R7-million in the Cape Town based startup, in return for a 20% stake each.
Kalon Venture Partners chief executive Clive Butkow told Ventureburn today that with half of the initial R14-million in funding pledged having been invested into the startup and with a number of milestones having been met by the startup, the two investors have now decided to invest the remainder of the committed funding.
He said both Smollan and Kalon have invested R3.5-million each for a total R7-million second tranche investment.
“We prefer not to discuss our ownership percentages except to say (that) between Kalon and Smollan we will be above 50%,” he said.
SnapnSave’s main clients are Momentum and Discovery, which provide the solution to clients who make use of their Multiply and Vitality loyalty schemes, respectively.
‘Nearing break-even point’
Butkow said the startup, which Bradshaw founded in 2015, is now nearing breaking even.
Bradshaw added that the startup now has 25 staff at the moment, up from the 15 it had in August last year.
He said the company is now in negotiations to offer a white label service for client rewards to a fishing group, a retail outlet and a local bank.
While in August last year he told Ventureburn that the startup intended to enter three Asian and African regional markets, he told Ventureburn last month that a decision had since been made to focus on the local market.
He said the new funding round will be used to either grow the local market or expand into new markets.
While in recent years the economy may have begun flagging, Bradshaw said his startup’s coupon solution was a winner no matter what shape the economy is in.
Said Bradshaw: “When the economy gets tighter people are looking for a way to save and when it is growing they’re spending too”.
Featured image: Kalon Venture Partners chief executive Clive Butkow (left) and SnapnSave CEO Mark Bradshaw (right) pictured during the initial funding deal signed between Kalon and SnapnSave in August last year. (Supplied)