As Africa rapidly urbanizes and develops, multi-unit property developments such as estates, gated communities, and shopping malls have become ubiquitous on the continent. These types of developments provide comfort and amenities to households that most governments cannot provide.

In Nigeria, electricity is sporadic and public access to water is virtually nonexistent, but the majority of these developments offer these amenities in exchange for a fee. These developments also offer a round-the-clock security outfit to protect their inhabitants. 

Managing these properties requires a lot of effort and can be very challenging. Various facets of the development, such as maintenance, repairs, and tenant relations, need to be coordinated and overseen. Additionally, a facility manager has to liaise with a variety of different stakeholders, including tenants, landlords, contractors, and regulatory agencies. 

Managing finances and budgets, ensuring adherence to rules and laws, and dealing with problems like security, safety, and emergencies are additional challenges that might occur when managing properties. According to Estate Intel, a real estate data company, most people are willing to pay high premiums for quality facility management. 

Image Source: Estate Intel

However, in Africa, residents’ experiences and property owners’ profits are negatively affected by numerous inefficiencies due to the largely manual and paper-based process of managing these communal developments. Pressing issues such as vending of utilities, billing of service charges, payments of service charges, and reconciliation of collection have typically been difficult to handle effectively. 

VENCO, a Nigerian proptech startup, is providing a solution to this problem. Founded by Chude Osiegbu (CEO), Reagan Mbitiru (CTO) and Uzochukwu Alor (COO), the startup’s all-in-one technology platform manages collections, service charge administration, utilities vending, visitor access, and other services associated with multi-unit property developments across Africa. To further scale its services, VENCO has raised $670,000 in an oversubscribed pre-seed funding round.

The pre-seed funding round was led by Zrosk Investment Management, with participation from Voltron Capital, Decimal Point Ventures, Fast Forward Fund, Tayo Oviosu, Odun Eweniyi, Oo Nwoye, Desigan Chinniah, Dakar Network Angels, SSE Angel Network, and Viktoria Business Angel Network.

Image Source: VENCO

On a call with TechCabal, Osiegbu, the CEO, said that VENCO intends to use this funding to build more features such as its credit delivery infrastructure for household spending, as well as grow its presence in Kenya and Nigeria and expand into South Africa and Ghana. 

The size of the market available to VENCO has considerably increased over the past decade. Most developers across the continent optimise their developments by making them multi-unit communities because that helps the unit economics of their buildings. Osiegbu shared that according to VENCO’s statistics, there are more than 2,000 organised multi-unit property communities with at least 50 units or more each between the Lekki Toll Gate and Ajah in Lagos, a 16-kilometre stretch. 

According to Osiegbu, at the end of last year, VENCO was used by 100 estates on about 4000 property units. He added that the startup is currently in 186 estates with about 12,000 property units and now has larger estates like Banana Island and 1004 in its roster. It has also processed transactions worth over $10 million on its platform since January 2022.

VENCO’s business model currently relies on subscription fees that it charges for the deployment of its software solution. However, Osiegbu added that this is not VENCO’s long-term play. “We are looking at monetizing embedded finance for the estates as a whole, as well as for individual households within the estates.” He shared that VENCO is already monetising this solution, as the startup helped finance the purchase of prepaid energy meters for the Primewater View Gardens estate, and the Tejuosho Market, a shopping mall. 

VENCO’s embedded finance solution requires it to play three roles: an originator for debt, a collateral guarantor, and a collections agent. The startup analyses data from its platform to determine whether households and real estate developments can repay loans. If they can, it either extends credit or connects lenders who use VENCO to create opportunities for lending. Finally, it collects loan repayments directly from its users. 

Speaking on the raise, Samson Esemuede, managing director and Chief Investment Officer at  Zrosk Investment Management, said, “The team at VENCO are building a platform that allows for the validation of the GDP of the African household. Not only does a platform like VENCO allow for significant improvement in the experience of African residents, facility managers, and property owners, but it could also potentially unlock at scale the sort of financial services the African consumer really needs. We view VENCO as both a SaaS and a financial inclusion play with a potential for strong multiplicative impact across the continent.”

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