Benin’s start-ups overcome ‘scammer’ stigma and hit global market

Assiba Bokon had seen moringa trees when she was growing up in Cotonou, Benin, but she didn’t learn of their worth until she attended a workshop in her 30s. 

She learned how to make moringa powder. Then, she perfected a juice recipe and began selling it locally. Next, she learned how to make pasta, pastries, syrup and cheese with moringa. By all counts, she was thriving thanks to making use of this so-called “superfood”.

But her business could never reach further than neighbouring countries – Burkina Faso, Togo, and Niger. 

For Bokon, online retail usually meant receiving a direct message on Facebook, followed by the challenge of figuring out pricing and delivery.

“How could I know what to charge because the shipping rates could change every day? It is hard to say what money I will spend and what money I will make,” she told Al Jazeera.

West Africa is in the middle of an economic genocide.

by Vital Sounouvou, founder of Exportunity

While Bokon and countless small vendors across Benin grappled with the reality of doing business in West Africa, the question of how to put his country on the map of international trade haunted Vital Sounouvou, a 27-year-old from Porto Novo. 

There was another problem – West Africa’s online reputation is widely associated with scams, which effectively blacklists it from global trade. Transparency International placed Benin 85th of 180 countries in its 2017 Corruption Perceptions Index. 

With this stigma, how could small enterprises make the leap from local clientele to global commerce? 

The payment problem

Six years ago, Sounouvou started developing an online platform called Exportunity to put local vendors in contact with large-quantity buyers anywhere in the world. 

The platform is a rare opportunity for businesses in the small West African country, but confronting a deeply entrenched international reputation means working twice as hard. 

“West Africa is in the middle of an economic genocide,” Sounouvou said.

Virtual payments are not new in the region.

Western Union, which has existed for decades, has given way to the convention of mobile money – a service that allows a person to send money using a phone number and cash. But mobile money is of no use in reaching international consumers.

Paypal extended service to Nigeria, Benin’s largest trading partner, and nine other countries in Africa in 2014, but the stigma remains.

Benin’s trade profile on The International Trade Administration of the US government associates the country with”419 scams” named after a Nigerian law that addresses financial crime.
Sounouvou not only needed to make it easier for vendors to sell online, he needed buyers to purchase without any glitches. 

He caught the attention of renowned Nigerian economist Tony Elumelu, who is a chairman at United Bank for Africa, after attending Elumelu’s entrepreneurship programme as an invited fellow in 2015. Impressed by his confidence, Elumelu introduced him to the CEO of United Bank for Africa (UBA) in Cotonou, Ellis Nzo Asu.

Sounouvou proposed a partnership with UBA that would allow Exportunity to use the bank’s secure payment system. 

Each Exportunity vendor would be given a secure website that would allow online payments.

Sounouvou required proof that they legally exist and listed additional information, beyond what is usually required by similar sites in the region, about each product on the platform. 

United Bank for Africa was attracted to the possibility of bringing small businesses into the formal economy, according to Nzo Asu, the CEO. 

The World Bank estimates that more than 90 percent of the labour force and 65 percent of Benin’s economy is informal, with workers paying little to no government taxes or using banks to invest and save money.

Shipping woes

Benin’s government-run postal service charges customers high prices to ship large volumes.

With no postal subsidies provided to start-ups and little delivery assurance, most small businesses relied on taxis and buses for shipping between neighbouring countries. 

To address these challenges, Exportunity pursued a partnership with Benin’s postal service, enabling the company to offer standard shipping rates to its member businesses. 

In 2013, Regis Ezin started his business, Dayelian, selling traditional Beninese snacks in modern packaging made with natural ingredients. Hoping to capitalise on the fact that “natural products are trendy in the Western world”, Ezin found it appealing that Exportunity focuses on export.

The business has ambitions of expanding to international markets, and using Exportunity allows Ezin to reduce the costs associated with accessing a new market. 

International exposure

Steve Hoda, an agricultural engineer from a village outside of Cotonou, has a startup called AgriBusiness, which specialises in making environmentally conscious farm equipment that automates manual tasks. 

But the problem of attracting international investors stifled Hoda’s progress from the start. 

“Many Beninese farmers can’t afford to invest in new equipment, even if they understand the benefits,” said Hoda. 

Hoda joined Exportunity last year using a free trial membership in the hope that his page on the site will legitimise his business to international investors. 

Without a presence on a secure site online, he believes that investors won’t feel confident enough to give him a chance. 

The most common complaint Exportunity receives from users are about its extra security measures, according to Didier Amouzounvi, Exportunity’s director of operations. 

The extra security measures, he says, are not negotiable.

Exportunity is a part of a wave entrepreneurship in Benin that intends to engage the international audience and the necessity of debunking the stigma of illegitimacy is irrefutable. 

Last year, Benin launched a government-supported initiative called Seme City, in search of the most innovative ideas that would enhance the tourism sector. 

One application question asked whether the idea was replicable in a global context. 

For new businesses in Benin, competing globally is a lifeline as important as the idea itself.