How Kenyan startup SOKO built an Etsy for entrepreneurs who don't have Internet

Digital Content

Imagine trying to build Etsy without its shop-owners having an Internet connection and you would get SOKO, an African e-commerce startup that shows how entrepreneurs in the developing world aren’t waiting for decent Wifi to tap into the Web economy.

SOKO is developing e-commerce business tools for artisans in the developing world. Its tools allow entrepreneurs to create online storefronts to sell their goods without needing the Internet, or even a smartphone. The company has 12 employees people around the world—two founders from the United States, one from Kenya—with its development team based in Nairobi.

“Emerging economies are really a hotbed of next-generation innovation,” said SOKO co-founder Gwendolyn Floyd, an experienced consultant for international NGOs and a veteran of Philips Electronics, where she focused on emerging markets. “'Entrepreneurialism' isn’t country specific. But when you grow up with challenges, you’re inherently a problem solver.”

The problem SOKO is trying to solve is how to connect a nation of entrepreneurs to the Web’s global marketplace where, in countries like the United States, the supply chain is being massively disrupted in ways that benefit solopreneurs and small-scale producers.

“When I was working in these far-flung areas, I saw these incredible handmade goods that had no way of making it to international marketplace and these amazing entrepreneurs with no way to participate in the global marketplace,” Floyd said.

Most of these artists don’t have a Web connection. But even though roughly 80 percent of Kenyan households don’t have have power, 93 percent of Kenyans have cell phones (the company’s largest telecommunications provider, Safaricom sells solar-powered charging equipment). With the spread of cell phones has come the rise of innovative payment systems. Mobile banking is ubiquitous through apps such as M-PESA, which Kenyans use to do everything from pay their rent to transfer money to friends and family. According to The Financial Times, 27 percent of the country’s GDP is in this kind of mobile money.

SOKO’s technology is built on this emerging payment system. Artisans can create online storefronts through an SMS entry form, including a vendor profile and uploaded product images. As they upload information, the products become transcribed as metadata, which is automatically uploaded to the SOKO website. Once their products are online, consumers around the world can buy them.

The company has about 250 artisans currently on the site and uses a peer recruitment model in which store owners recruit and mentor other sellers. To make money, SOKO adds a percentage to their vendors prices, which is the cost shown online. The company, which went into public beta earlier this year, raised $200,000 in grants and awards that allowed them to build personnel and products. SOKO has raised close to $1 million in seed funding.