With The Shopping Season Round The Corner, Here Is A Sneak Peek At The African E-Commerce Industry

Team WeeTracker October 9

A report by International Post Corporation predicts that global e-commerce sales will go up by 141% between 2016 and 2021. Today it’s rare to find a smartphone without an application for online shopping. People find it much more convenient to sit at home and choose from a vast variety to save themselves from the trouble of going out and hunting for the right product in 10 different shops.  

Amazon and Alibaba are the largest players with Amazon’s market cap touching USD 1 trillion in September 2018, and Alibaba nearing half a trillion. They have avoided mainly direct competition by dominating different parts of the world, but they are widening their reach by buying up the smaller local platforms. Their acquisitions mean that the global e-commerce landscape is consolidating. While Amazon currently dominates North America and Europe, Alibaba controls China and has made a web of strategic partnerships and investments in Southeast Asia.

However, there lies fierce competition in some economies, especially in burgeoning e-commerce markets of India, Australia, and Singapore. In India, the two are already in direct competition, where Alibaba and its affiliate Ant Financial have more than 50% stake in local payments and e-commerce platform Paytm Mall. While homegrown giant Flipkart, the second largest player in the market with 40% market share, has lately closed a deal to sell 77% stake to Walmart. Amazon here leads with 44% share.

Singapore is seeing Amazon struggle against local biggie Lazada which Alibaba had acquired and operates as a marketplace in the six Southeast Asian countries: Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam. In China, apart from Alibaba’s TMall and Taobao, JD.com, Suning and Vip.com are the major players. While Amazon is a clear leader in Europe, regional players like Zolando, Otto, Casino and plenty of others.

What’s up with Africa?

A combination of several factors, amongst which the dearth of internet access, high illiteracy rate, and inefficiencies in logistics are considered the most telling drawbacks, form the bulk of the reason why eCommerce in Africa hasn’t exactly hit the heights or reached its full potential. While most of these problems are far from taken care of, the penetration of mobile devices – most notably, smartphones – which can be attributed to advancements in technology and innovation, have made access to the internet and mobile payment systems something of a given for millions of Africans.

By virtue of this development, it might not be exactly out of place to refer to the continent as the next big thing when it comes to online shopping. And it does seem like the numbers are in favor of this claim as data from Statista estimates that the African eCommerce industry is expected to rake in around USD 29 Bn in revenue by 2022, and that is after generating up to USD 16.5 Bn in 2017.  

According to data from Emergent Payments, despite boasting a population of around 1.25 billion people drawn out from 54 countries, the penetration of the internet on the continent still stands at only 35 percent. This can be construed to imply that there might still be a lot of work left to do in that regard. More so, of the proportion of the continent’s consumer base who can lay claim to having internet access, only a relatively meager fraction can be said to utilize desktop or laptop computers to surf the web.

Putting two and two together might suggest that Africa’s eCommerce market is predominantly mobile-based. It will be accurate to add that in combination with mobile-friendly payment systems, mobile devices have largely been the ‘go-to guy’ in the area of exploring the prospects of eCommerce on the continent. And this can be thought to have provided a pathway for the exploration of shopping opportunities in locations that would be otherwise unreachable due to the absence of physical stores and other infrastructure.

The Challenges Of eCommerce In Africa

  • Due to drawbacks associated with logistics and even fraud, the posture of African towards eCommerce can be considered somewhat apprehensive. In other words, Africans do not exactly jump at the idea of shopping online because of an inherent lack of trust in the system. Although significant progress has been made in this regard in recent times, as is evident in the increasing number of Africans that are known to now favour the online route for their shopping activities, there is still some work to be done in the area of imparting a more relaxed mindset and a receptive demeanor to Africans on the subject.

 

  • eCommerce on the continent is hampered by the shortage of far-reaching and widespread street address systems in a considerable number of African countries. Throw that in with the lack of infrastructure in the form of good road networks which doesn’t fill global logistics companies with optimism and there looms another problem. This brings about the high cost of logistics as last mile deliveries and transportation come at abnormally exorbitant costs in parts of the continent. The situation that has made motorcycles something of the most-used mode of transport for deliveries. There also exists a tracking and communication gap as customers are often left with no choice but to incur extra expenses by using calls to keep track of their purchases, which often discourages interest in shopping online.

 

  • There is also a challenge in that a significant proportion of the African population is unbanked. In spite of that, nearly 280 million Africans are known to have mobile wallets; a figure that is over three times the number of African who possess bank accounts. More so, the average of African digital consumer is placed at a relatively precocious 19 years. And this could imply that older African consumers are more suited to the cash-on-delivery (COD) arrangement, which actually still represents the most favored method of payment on the continent.

 eCommerce In Some African Countries

eCommerce can be considered to have done reasonably well in such countries as Nigeria, South Africa, and Kenya — three countries that are known to top the charts in African eCommerce sales.

With a population of over 180 million people, Nigeria is considered Africa’s most populous nation, and the country is also known to be the largest economy on the continent in terms of Gross Domestic Product (GDP). Accounting for up to 40 percent of Africa’s eCommerce ventures, the country is home to the most number of eCommerce platforms on the continent. But in spite of all these somewhat impressive figures, internet penetration still stands at somewhere around 48 percent in the country.

Weighing in at a population of around 55.5 million is South Africa, which also boasts a significant population of middle-class citizens and probably the best offerings when it comes to cross-border potential. The country could, however, do better than the 54 percent which represents the degree of the reach of the internet in the country at present.

Kenya does serve up an interesting prospect, though. The East African country whose population is placed around 48.5 million does weigh in with an impressive 79 percent in the area of internet penetration. M-Pesa; a mobile wallet provider that is the creation of mobile telecom provider, Safaricom, is known to have garnered considerable interest and use from Kenyans since it came into existence.

According to a GSMA report, M-Pesa is currently seeing use from over 40 percent of Kenyan adults. Its creators, Safaricom, are also reported to have recently sealed partnership with global fintech giants, PayPal, which will see Kenyans make money transfers between PayPal and M-Pesa mobile wallets with relative ease. And this partnership could well serve to help Kenyan enterprises that wish to sell abroad gain access into the global markets. Essentially, the narrative from Kenya might be suggestive that eCommerce thrives under an atmosphere that is buoyed by secure payment systems, as well as far-reaching and reliable internet access.

Notable African eCommerce Platforms

Africa is not exactly a haven when it comes to selling products and services online. This claim is afforded even more substance when thought is given to the fact that even global eCommerce giants like Amazon have not done much to demonstrate any real interest in launching a major onslaught on the African market.

There are over 200 startups in Africa that are known to be plying the eCommerce route, and it has not been exactly a profitable journey as a significant proportion of these enterprises are a long way off from actually garnering substantial revenue. It also evokes mixed reactions that enterprises from only a handful of African countries account for the bulk of investments in this venture.

Having raised USD 150 Mn in 2014 alone, Africa’s best-funded eCommerce startup can be found in Nigeria-based Jumia Group which now has presence in 14 countries in Africa and the Middle East (with each country having its site), while employing up to 3,000 people since coming into existence in 2012 as the creation of Berlin-based Rocket Internet.

Since announcing its presence in Nigeria, the company is believed to have made significant strides in the country’s eCommerce sector by putting together a logistics infrastructure that incorporates over 500 motorbikes and trucks. This is known to facilitate its deliveries in major Nigerian cities. As has been earlier highlighted, COD which is largely favored as a payment method in Africa is also accepted by Jumia.

Another Nigerian eCommerce startup, Konga, started with the sales of baby and beauty products when it first hit the scene in 2012. Although the eCommerce platform only has operations in Nigeria, the site is believed to possess a customer base that is on the threshold of a million, as well as 300,000 visitors daily.

The company opened a third-party marketplace called Seller HQ in 2014, while also boasting its own logistics network called KOS Deliveries which has over 200 vehicles (vans, trucks, and motorbikes) set aside for the purpose of making deliveries. Pick-up points and distribution centers in various locations are also available on the platform, as well as a unique payment system, KongaPay, which is featured on some Nigerian banking platforms. The platform is known also to serve up a unique offering which provides that the money of customers are held in escrow until sales transactions are completed.

Local hardware and information technology services company, Zinox, are reported to have acquired the company earlier this year with such factors as financial losses and the inability to fund growth allegedly playing a role in the sale.

Kenya’s Kilimall is another notable African eCommerce platform. The company which is known to also sell in Nigeria and Uganda offers both affiliate and seller programs to small African businesses. Also worthy of mention is Kenya’s Sky.Garden which essentially offers a SaaS mobile platform and is believed to now also have more than 3,000 sellers and 23,000 unique products in 30 different categories. For good measure, the platform is known to only accept M-Pesa payments, which is the same mode it employs in making payments to its merchants.

South Africa’s Takealot also appears to be holding its own in the African eCommerce environment. The company came into existence in 2011 after Tiger Global Management acquired an existing eCommerce company. Takealot is known to have received a capital boost when its parent company invested USD 100 Mn in the eCommerce platform back in 2014. The infusion of funds is believed to have been instrumental to the subsequent purchase of logistics company, Mr. D Delivery, which afforded Takealot its delivery network with as many as 900 drivers on the roster. In addition to deliveries, Takealot claims to offer pick-ups from its warehouse in Cape Town every day of the week, while also offering such services as storage, fulfillment, and delivery, as well as customer service to its merchants.

Cross-Border Potential

Africa’s shortcomings in physical retail infrastructure might come across as a drawback at first glance, but a view from a different perspective would reveal that it does put cross-border eCommerce in a favorable position.

This is largely true for individuals who are looking to purchase western products from local online businesses whose platforms support payments in the local currency. In any case, Africa is not exactly an easy terrain when it comes to online selling so best practices might dictate that cross-border merchants leverage existing local platforms for their sales.

China is known to currently lead proceedings in cross-border sales in Africa as it would appear the continent favors the sale of products that are relatively inexpensive — and this happens to be the forte of the Chinese. Goods from the U.K. also appear to be holding their own in African countries that are British colonies.

More so, countries like Kenya, Nigeria, and South Africa are expected to deliver most of the sales in cross-border eTrade, and individuals from some of these countries are known to be already thronging British, American, and Chinese online shopping sites. With that in mind, it might be advisable for cross-border sellers in those countries to form business relationships with local payment platforms and providers of courier services.

Small local businesses are largely the focus of Africa-based eCommerce sites as most of these platforms are known to support third-party sellers. However, Nigeria’s Mall for Africa is known to be towing a slightly different line as it believed to afford Africans the opportunity to shop from around 250 online platforms in the U.S. and U.K., with DHL Express shipping services available in over 60 of those including names as Amazon and eBay.

The company is known to currently be operational in 15 African countries including Nigeria, Ghana, Kenya, South Africa, Uganda, and Rwanda. It also boasts numerous pick-up locations in these countries which serve to make purchased goods easily obtainable for people living in locations that lack standard physical address systems. Also incorporated into the platform is its very own debit card which allows for shopping in over 180 online platforms in the U.S. and U.K.

 

Egypt’s Nawah Scientific Gets USD 1 Mn Funding Boost From Endure Capital

Nzekwe Henry December 10

Egyptian research startup, Nawah Scientific, has secured an investment worth USD 1 Mn in a pre-Series A round led by Endure Capital, with 500 Startups, Averroes Ventures, Egypt Ventures, and angel investor, Dr. A. Abdelhamid, also joining the funding round. This is the first time the startup is raising external investment.

Nawah Scientific is a Cairo-based startup that appears to be carving a niche for itself in the area of scientific research. The startup which was founded in 2015 by Dr. Omar Sakr; a PhD holder in the field of Pharmaceutical Sciences, boasts a collection of advanced equipment that is suited to the research and development needs of both natural and medical sciences.

Nawah Scientific helps scientists and universities who do not have access to sophisticated equipment and facilities carry out critical research tests that would be otherwise improbable or too much to ask.

The startup goes about this by receiving experiment requests via its online platform. Through a courier, the test samples are moved under prime conditions from the address of the client that made the request to premises of the startup.

A team of competent in-house scientists then take the reins from that point onwards as the required tests are carried out and the test results are relayed to the client via the startup’s online platform. Through this simple but effective mode of operation, Nawah Scientific is able to cater for the needs of researchers as it affords scientists access to top-notch research facilities, whilst fostering scientific research in both Egypt and beyond.

Having been established barely three years prior, Nawah Scientific claims to have offered its services to clients within and outside Egypt. So far, the startup claims to have analyzed as many as 15,000 samples from 32 universities. But the services of the startup do not stop at scientists and academia as it also carries out complicated research projects and simple analysis for chemical and pharmaceutical companies.

Commenting on the development, Dr. Omar Sakr, Founder and CEO of Nawah Scientific, tethered his motivation for establishing the startup to the need to make access to cutting-edge research and high-tech equipment more available.

He also noted that a lot of time that should otherwise be put into meaningful work is spent by scientists shuttling between cities and universities to have their samples tested. And in the process, yielding unreliable research projects that are shallow at best. According to the CEO, this has put a strain on the trust between industry and academia resulting in a poor ‘research-to-product’ conversion rate. He, however, believes that the startup is now better poised to fix these problems.

With the latest development, Nawah Scientific has now become one of the first life sciences startups in the MENA region that has achieved success in raising significant investment. Since its inception, the startup has posted an impressive year-on-year growth and this can be thought to have gone some way towards attracting and closing the investment deal. And this bodes well for other science-based startups in the region as the company appears to have broken the proverbial glass ceiling.

Speaking with regards to the investment, Tarek Fahim, Managing Partner of Endure Capital, opined that biotech startups share a lot in common with software startups before AWS and rapid development tools. He also stressed the importance of infrastructure players who can push boundaries to the growth and sustainability of biotech enterprises, stating that they can help “lower cost for starting and increase the speed of prototyping.”

Egypt Ventures; a VC that was launched recently by Egypt’s Ministry of Investment, is believed to be the biggest investor in this round. Hema Ali, Managing Director of the newly launched VC, expressed the company’s excitement at being part of the startup’s journey as it looks to scale its offerings and expand into new markets.

It was this time last year when Nawah Scientific clinched the grand prize in the pitch competition at the 2017 RiseUp Summit. Having emerged winners of the competition, the startup roped in a USD 50 K cash prize.

Now, barely a year on from that night of blitz, the startup appears to be holding its own quite well, and the latest investment worth USD 1 Mn (which is quite substantial given that the startup is raising external capital for the first time) is a testament that Nawah Scientific is on the right track, as this connotes investor confidence.

Plans related to expanding the startup’s services and growing its marketing activities outside of Egypt are expected to get most of the attention with the latest capital injection.

 

 

Feature image CourtesyNawah Scientific

Egyptian Healthtech Startup Vezeeta Raises Investment From IFC

Nzekwe Henry December 10

Egyptian healthtech startup, Vezeeta, has secured an undisclosed amount of investment from World Bank Group’s International Finance Corporation (IFC). This development sees Vezeeta become the first Egyptian technology company to bag a direct investment from the IFC.

Vezeeta is one of the leading healthtech startups in the MENA region and the latest investment from IFC into the Cairo-based company follows a previous announcement which saw the startup close a Series-C round worth USD 12 Mn. That round was led by STV; a Saudi-based investment firm.

Vezeeta was launched in 2012 by Amir Barsoum. The startup makes it possible for patients to search, compare, book, and consult with doctors in Egypt, Saudi Arabia, Jordan, and Lebanon. Vezeeta also assists medical personnel with practice management solutions that help in better management of medical appointments and patient data.

Up to 2 million appointments are believed to be facilitated by the platform on a yearly basis, and that’s according to the startup. More so, Vezeeta claims to have over 10,000 healthcare providers signed on to the platform, providing services to at least 2.5 million patients in the region.

With regards to the development, Amir Barsoum, Founder and CEO of Vezeeta, offered that the investment from a “global power” like the IFC will help accelerate the growth of the startup, as well as buoy its plans of building a formidable global network.

Chief Executive Officer of the IFC, Philippe Le Houerou, also commented on the development expressing his confidence in the ability of Vezeeta to drive innovation in the MENA region. The CEO also expressed delight at the prospect of African entrepreneurs harnessing their creativity and drive with the power of novel technologies to address some of the continent’s most pressing problems.

Vezeeta’s Chief Technology Officer, Adel Khalil, also rendered his voice in support of the development reiterating its importance in helping the startup keep up with its mandate of empowering millions of patients in the region, and making sure patients and healthcare providers are seamlessly connected by leveraging data and new products in healthcare.

Mohammad Elmougi echoed, Vezeeta’s VP North Africa, echoed the thoughts of the CTO when he hinted at the commitment of the startup to pulling down all accessibility barriers and improving the quality of healthcare experienced by patients in the region through the elimination of all the bottlenecks that currently bedevil quality healthcare service accessibility.

While this is undoubtedly the IFC’s very first direct investment in an Egyptian technology venture, it would, however, not be the first this investment arm of the World Bank Group is throwing about its financial weight in the MENA region. Over the course of the past few years,  the IFC is known to have made funding commitments worth over USD 100 Mn in startups, venture funds, and accelerators across the Middle East and North Africa, including such Egyptian ventures as Flat6Labs and Algebra Ventures.

 

Feature image courtesyMENAbytes

Ugandan Startup Swipe2pay Swipes Away USD 40K At BRIDGE East Africa Startup Pitch

Kevin Gachiri December 10

Swipe2pay, a Ugandan startup was picked as the winner of BRIDGE East Africa Startup pitch and secured USD 40K at Weetracker’s first flagship conference event held at Crowne Plaza on 7th December in Nairobi. The announcement was made by Takuma Terakubo the CEO of Leapfrog Ventures whose joint partnership with Weetracker made the event possible. Leapfrog Ventures will add Swipe2pay to its roster of startups, it is funding in East Africa. Other startups that took part in the pitch included Yusudi, Talklift, Zumi and Asilimia.

The Selection of Swipe2pay came as a surprise considering that each of the 5 startups had delivered convincing pitches in front of the panel that comprised Japanese investors on tour in Africa, some for the first time. Solomon Kitumba, CEO Swipe2pay, had come from pitching at #slush18 in Helsinki arriving in time to make his pitch as the last participant for the day. Swipe2pay makes it possible for informal businesses that accept cash from customers to be able to accept digital payments as well as credit card transactions. The startup which was founded in 2017, is already integrated with Visa and Mastercard.

In an interview with Weetracker, Solomon intimated that “We are already active in Uganda with a majority of our customers coming from Mbarara and Jinja. We have built a regular customer base of 550 regular users on our  platform with transactions sometimes growing upto 3,500 per day when we get very busy.”

According to their website, the solution they provide to customers also includes their provision of daily, weekly and monthly reports. The fintech startup has integration with Kenya’s MPESA making it possible for them to venture into the local Kenyan market as well.

Solomon is assisted by a team of six who play different roles in driving the business forward and the funding they have received will go into product development as well as strengthening its talent pool which would be necessary for looking at how the product can be polished, refined or extend its features. Having grown in rural Uganda, Solomon had observed how informal market traders mostly women fail to access finance since they don’t keep records or any form of payments they receive from clients.  This makes it difficult to get credit reference. The need to accept funds from clients who wish to pay by cards also means that they usually turn away clients from this customer segment. Swipe2pay, therefore, helps in attracting more customers.  It is this discovery that made Solomon devise a method of bringing a better solution to these informal traders.

Weetracker’s BRIDGE East Africa, held in Kenya drew a substantial crowd of investors from Japan as well as attendance of local investors, venture capitalists and seasoned entrepreneurs. The event hosted startup pitches that were held in between the panel discussions and fireside chats with selected guests. Leapfrog Ventures announced at the event that it is looking at making 200 investments in Africa in the coming 3 years.

What You Should Know About Google Hangouts’ Rumored Shutdown

Andrew Christian December 9

Sources familiar with the tech giant’s product’s internal roadmap have reported that 2019 will be the last year for Google Hangouts, as the company plans to shut it down by the year 2020. The development, to nearly no one’s surprise, is a reiteration which accompanies the company’s apparent decision to hold off on further developments on the app more than a year ago.

Google had previously announced its pivot for the Hangouts brand for enterprise use scenarios with Hangout Chat and Hangout Meet, so it has been telling for a while that the consumer app would soon cease to exist. With the abandonment of Google Hangouts concerning development and its presumed final extinction, many entrepreneurs have begun charting a course away from the app, even though it will remain a prominent official chat option in Gmail on the web – continuing on the Google Play Store even now. In line with recent reviews, the app has shown signs of ageing which are evident in its display of bugs and performance glitches.

Hangout as a brand will remain with G Suite’s Hangout Chat and Hangouts Meet, with the former tailored for Slack app-comparable team communication and the latter as a video meetings platform. In the same line, Google Voice calling, which was initially independent and then integrated into Hangouts, was restored to its own redesigned app earlier this year.

Worthy of interest is that in spite of its inevitable axing, Hangouts was one of the few apps to receive early support for Android Auto’s new MMS and RCS functionality, alongside Whatsapp and Android Messages.

Nonetheless, Google’s Scott Johnson has chimed in on this development and denied any decision being made about the timeline of legacy Hangouts’ shutdown. He did confirm that users of consumer Hangouts will somehow be upgraded to Hangouts Chat and Hangouts Meet, both of which have been presented as enterprise-focused products that fill different needs. Scott also confirmed rather explicitly that Hangouts Classic, which is the subject of this development, will eventually be “shutting down’. Meanwhile, there are sources which corroborate the initial report, informing that decisions have been made for the depreciation of legacy Hangouts.

Most of us consider the Chat and Meet to be more business-focused products, and these plans make the situation seem as though they could have more of a consumer-facing component in the future. For entrepreneurs who have continued to use Hangouts, and who are now coming to rely on Slack or Discord style at-mentions, having such features in Hangouts may be somewhat snazzy. If the rumour of Hangouts’ death or transition are true or have been exaggerated, it wouldn’t matter so much if the new upgrades come with those new features.

Meanwhile, another source reports that Google provided an update on its current efforts, and now focuses moving towards a simpler communication experience. Starting on the consumer front, Google has “decided to stop supporting Allo to focus on Messages.” In April this year, Google only noted that it was “holding off investment” on Allo, but the tech giant confirmed that the service is about to get the sunset. Allo will be available until March 2019, with the service continuing to work until then; disregarding today’s downtime. Google has furnished us with details on how users can export existing conversation history from the app.

Google Hangouts, for as long as it has been in use, hasn’t disappointed entrepreneurs, as it can be a great asset to a company of any size – even more ideal for smaller businesses and startups. The app allows you to connect with employees easily, business colleagues and clients via calls and video chat making it seamless for those who travel or work from home. Hangouts also afford companies the flexibility of connection form virtually any smart device. Users can also, during chats, share files via Google Drive, stream live broadcast, participate in webinars and hold staff meetings amongst many more.

As customers will be able to review your business as an accessible one that cares about customer satisfaction, using Google Hangouts is a marketing strategy with all the makings of greatness. With weekly/monthly question and answer sessions, customer chats and feedback reception, you can not only appeal to customers but receive immediate interactions that can help you develop a more robust marketing strategy. Taylor Swift hosted a Google+ Hangout to announce her new album, and with the medium, she was able to reach fans from all over the world – making her song hit number one right after its release.

This goes to say that Hangouts is a great way to make business announcements such as funding rounds, product launches, expansion or any other news that customers may be interested in. The app is also useful in holding online staff meetings, and conference calls with important clients even while you are in transit.

We are yet to find out the actual features that will come with the storied Hangouts Chat and Hangouts Meet as replacements to the authority-building, customer-gathering, engaging, and collaborative Google Hangouts. 2020 is more than a year from now, so while Sundar Pichai and his team of techies decide the fate of this G Suite member, we still have no less than 12 months to enjoy the existing chat room app.

Nigeria’s Logistics Startup Kobo360 Raises USD 6 Mn From World Bank’s IFC

Andrew Christian December 7

Nigeria’s Uber-like trucking logistics startup Kobo360 has raised USD 6 Mn in its second investment round this year. The equity financing which was gained from World Bank ’s sister organization IFC, will help the company upgrade its e-logistics platform and spread its tentacles to Ghana, Togo and Ivory Coast.

This recent investment for Kobo360, which also involved efforts from other platforms such as TLom Capital and Y Combinator, will be used by the startup to become more than just a transit app. The founder, Obi Ozor, told Techcrunch that the company broke into the logistics market as an app that connects truckers and companies with freight needs, but now looks to build a global logistics operating system and become a full-fledged platform.

While bridging the gap between truckers, producers and distributors, Kobo360 is now chomping at bit to build the platform that will offer supply chain management tools for enterprise customers. In a statement, Ozor revealed that large firms are now demanding for movement, tracking and sales-related specific features, which is why the startup is looking to leverage two options – integrate other services such as SAP into Kobo or building the solutions directly into the e-logistics platform.

With this new investment round, the startup will sally forth with the said upgrade by developing its API and opening it up to for the use to large enterprise customers. With the intent for clients to use Kobo360’s dashboard for everything from moving goods, tracking, sales and accounting, the platform wishes to tackle the challenges faced by its customers.

It is also reported that the company will forge a more physical Nigerian presence in order to serve its customers better. Concerned about truck movements and monitoring, helping operation’s collect proof of delivery and accessing trucker owners more closely for inspection and training purposes, Kobo360 is poised to launch 100 hubs before the end of 2019, according to its founder.

The startup, remaining “aggressively” focused on reducing logistics friction for large enterprises and SMEs alike, alongside connecting new markets and unlock better community wellbeing, will add more warehousing capabilities to support its reverse logistics business. By matching trucks with return freight after they drop their loads, Kobo360 will bring down prices and eliminate the return-empty challenge facing its customers.

In a statement, the IFC enthused that the company currently has over 5000 trucks empanelled on its platform, from more than 600 small fleet owners, serving some of the largest enterprises in Nigeria. Kobo360 told Techcrunch in January that it is looking to add 20,000 trucks to its platform and latch on to the expansion which is now made possible by its USD 6 Mn raise. According to the founder, the expansion, which is scheduled to take off in 2019, will be with existing customers – one in the port operations business, another in FMCG and the last in agriculture.

As a matter of strategic priority, the funding, which was announced by both parties on the eve of the opening of the IFC’s Next 100 African Startups Initiative, will be used by the startup to also expand programs and services for its driver members. Along this line, Ozor remarked that neglecting drivers would crumble the company to a pile of issues while iterating that the same loophole hinders ride-hailing companies from becoming trillion-dollar enterprises.

Because owning trucks may be too cumbersome to handle, Ozor opines that the best scalable model is to aggregate trucks, while handling more volume at cheaper prices to leverage the startup’s asset-free digital platform and business model to outpace traditional long-haul 3PL providers in Nigeria.

According to a Weetracker report, Kobo360 raised USD 1.2 Mn in June this year from U.S venture capital firm Western Technology Investment and became a Y-Combinator cohort, while receiving USD 120 K equity investment from the seed fund. The logistics startup, which has served 900 businesses, aggregated a fleet of 8000 drivers and moved 155 million kilograms, is welcoming IFC’s regional head for Africa, Wale Ayeni and TLcom’s senior partner Omobola Johnson to take seats at its board.

Kobo360 also offers training and programs on insurance, discount petrol and vehicle financing to its drivers. The startup has also created an HMO for drivers, alongside an incentive-based program to afford education, which is monikered as KoboCare. The company’s top clients include Honeywell, Dangote, Unilever, Olam and DHL.

 

Featured Image Courtesy: Macktrucks

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