Ethiopian Software Company Bets On Rent-to-Use SaaS Model with Monthly Subscriptions Starting at 5,000 ETB

Purchasing software is often financially burdensome for businesses just starting out, and most Small and Medium Enterprises in Ethiopia. One homegrown tech company is looking to reduce the high upfront costs for software tools with a subscription-based software on a “rent-to-use” model. Yonet Systems, a three-year-old startup founded by two friends, seeks to provide software for as little as 5,000 birr a month. 

“We wanted to make software accessible,” says Natnael Assegid, co-founder and Chief Operating Officer of the startup. “A lot of businesses want digital tools but can’t justify the high investment costs. We’re trying to solve that”.

Together with co-founder Yonathan G/Eyesus, the two Addis Ababa University graduates built Yonet on the principle of affordability. The product offerings came after surveying over 1,200 businesses. The research revealed a high demand for inventory management, customer relationship tools, and e-commerce platforms, services that many small firms couldn’t afford in a traditional format.

“After two months of brainstorming, we developed a Software-as-a-Service (SaaS) model,” Natnael told Shega.

Yonet’s SaaS platform aims to provide customizable apps in multiple tiers, ranging from entry-level tools for small shops to enterprise-grade AI-enhanced solutions for large organizations. These include inventory trackers, HR tools, and CRM systems. Depending on a client’s scale, Yonet looks to offer cloud-hosted apps, 24/7 support, workflow automation, and even AI-driven insights for enterprise clients.

The complexity of the apps depends on the pricing tier. Basic tiers support straightforward solutions like invoicing or booking systems, while professional and enterprise tiers enable advanced applications, such as AI-driven supply chain optimization tools.

“Our long-term vision is to empower 250,000 businesses across Ethiopia and East Africa by 2030,” says the COO. 

The startup currently has a lean structure which includes eight full-time employees and a network of freelancers across Ethiopia, Nigeria, and the U.S. It’s tech stack comprises cloud platforms like AWS and Digital Ocean, modern frameworks such as React for front-end and Node.js for back-end.

While Yonet Systems is in its early stages, the founders are convinced of the potential in the market due to low adoption of software tools among Ethiopian SMEs, despite their apparent necessity.  A recent report by the Center for Financial Inclusion at Accion indicated that more than half of Micro and Smal enterprises in Ethiopia’s capital don’t use any digital tools. The study underscores that digital adoption is closely linked to business growth and resilience, with firms that adopt them being 10% more likely to report revenue growth.

Yonet’s subscription model emulates a global trend with more global companies opting for recurring revenue rather than one-time payments.