Daniel Yu is the Global Chief Executive Officer (CEO) and founder of Wasoko, a B2B e-commerce platform with integrated financial services and logistics that connects merchants in Africa directly to local and multinational suppliers.
Mr Yu is an entrepreneur and software developer with extensive personal and professional experience working and travelling across 65 plus countries, primarily in emerging economies in Africa, the Middle East, Central America, Brazil, Southeast Asia, and China.
Wasoko currently serves tens of thousands of merchants across Kenya, Tanzania, Rwanda, Uganda, Côte d’Ivoire, and Senegal while partnering with leading manufacturers including Unilever and Procter & Gamble.
Daniel co-founded the company in 2013 alongside his partner Josh Raine who serves as the chief operating officer.
WoK takes a look at the company’s founding, and rise to the fastest-growing company in Africa.
Background & Education
Yu was born in the US and attended the University of Chicago where he focused on International Studies and Linguistics before dropping out.
He obtained his Business Acumen for Senior Microsoft Leaders from Wharton in 2019.
Career
According to his LinkedIn profile, Daniel Yu served as a faculty coach at the University of Chicago Booth School of Business from September 2014 through December 2014. He taught Application Development to 2nd year MBA students. He also taught web development skills across multiple programs at the institution.
In September 2018, he was selected as an Endeavor Entrepreneur at the International Selection Panel held in Buenos Aires in September 2018. Endeavor offers its entrepreneurs access to a world-class network of talented individuals and organizations that help them to think bigger, make better business decisions and multiply their impact.
Wasoko
Daniel Yu came up with the idea to establish Wasoko while spending time in Egypt. Being a software developer, he set up the platform and reached out to different suppliers in diverse markets to run a pilot. Among the interested parties were Kenyan suppliers.
Interest and excitement from the Kenyan manufacturers and suppliers prompted Yu to settle in Kenya at the time.
“Maybe it’s because of Kenya’s advanced tech adoption, especially mobile money,” he told Business Daily.
“The population was very comfortable with mobile money transactions, I mean sending money with just USSD. Our initial technology also used SMS, basic mobile phone systems for ordering supplies.
“The suppliers instantly understood the concept, whereas in other markets this idea of using the phone to order goods was something quite strange,” he noted.
Like any other start-up, Wasoko faced challenges while setting up. Daniel Yu realised that just like them, manufacturers were also struggling a lot with logistics and so they had to step in and help organise.
With a background in software development, he sought people to help them with this and was able to figure that out with time.
Daniel further noted that the company did not face any challenges when it comes to talent recruitment.
“I would say I did not, certainly not in the early days. I think we were able to find everyone that we needed to get the initial operations set up,” he said.
“We had a great group of young Kenyans, many of whom are still with us today and have really grown up taking senior roles within the team. I would not say that was too much of a barrier,” he added.
According to Daniel Yu, their first major milestone is launching the pilot in 2015 since the original idea they had started with dod not work.
“We had to adjust the model to include doing our own logistics. And you could say our second milestone was when we pivoted to doing our fully integrated logistics model.
“From there we figured out the operational model that could scale and that would really drive growth in customer demand,” he explained.
Another milestone was raising the seed round of funding in 2018.
Daniel adds that being named the fastest-growing company in Africa by the Financial Times was also a great honour for Wasoko since the company is still relevantly new and growing.
“It was something that we didn’t expect. Prior to that, as well as the funding we received earlier this year, a lot of people did not know who we are,” he said.
Yu notes that one of the biggest sacrifices he has had to make in his entrepreneurial journey was moving away from his home to found the company in a foreign country. He adds that he had been working on projects back home which he had to put on hold to ensure the success of Wasoko.
His biggest challenge however is something else.
“I knew how to code the system but I didn’t know how to set up a warehouse and manage it. We also didn’t have a lot of funds. This was a big risk to take and we were somehow not sure that these operations would actually lead to success,” he explained.
Daniel Yu states that luck has been the biggest part of their success, explaining that the company would not have grown to the level it is today if a number of critical things had not gone their way.
“If maybe we had tried to fundraise six months later, we would not have had the same outcome. The same goes back to our first seed round [2018]. We had an unfortunate situation where an initial investor ended up collapsing because of an internal scandal.
“But right before we ran out of money, we managed to find a different investor. I do think that part of that though is perseverance. It’s about not giving up and being resourceful. If you run into a wall, you don’t stop and go home, you find creative ways to go sideways and around it to find a door,” he explained.
In March 2022, Wasoko raised $125 million (Ksh14.29 billion) in Series B venture capital funding. This valued Wasoko at $625 million (Ksh76.44 billion).
“Out of $125 million, we will be investing at least $20 million in Kenya,” Daniel Yu said at the time.
The capital was raised from venture capital firm Tiger Global and Avenir Growth Capital. Other contributors included VNV Global, Binny Bansal (co-founder of Flipkart), Sujeet Kumar (co-founder Udaan), Quona Capital, 4DX Ventures, and JAM Fund.
Part of the fund will also be used to expand its presence to West African markets such as Senegal and Ivory Coast as part of Wasoko’s regional expansion plan.
“Informal retailers capture the vast majority of consumer spend in Africa, and they are dramatically underserved by existing distribution and financial infrastructure,” Avenir Growth Capital Founding Partner Andrew Sugrue said in a statement.
“We’re excited about the category-defining, Pan-African commerce platform Wasoko is building and the efficiencies it brings to these retailers and their suppliers through a combination of superior product selection, logistics, and financial services.”
Currently, the firm boasts over 50,000 active retail customers across Kenya, Tanzania, Rwanda and Uganda. It also offers a credit facility under ‘buy Now, pay later’ for retailers who need working capital.
Awards & Recognitions
Daniel has received international recognition and awards including; the Prince of Wales Young Entrepreneur Prize, and the designation by the White House as an Emerging Global Entrepreneur.
He was also named the Craine’s 20 under 20 and Forbes 30 Under 30 Social Entrepreneurs.
The World Economic Forum Global Shapers Community is a network of city-based Hubs developed and led by young leaders between 20 and 30 years old who want to develop their leadership potential towards serving society.
Through the Global Shapers Community, Shapers are provided with opportunities to connect with the worldwide network of Global Shapers and to represent the voice of youth at World Economic Forum events.
Philanthropy
Daniel Yu in October 2020 committed to the Founders Pledger, pledging to give 70 per cent of the proceeds from his equity in Wasoko to the most effective interventions for reducing suffering.
The community has over 1400 entrepreneurs and investors who have each pledged at least 5% of their venture proceeds towards effective philanthropy, fully supported free of charge by the Founders Pledge team.
