USD 6.2 Mn Seed Capital Raised by Egyptian B2B E-Commerce Startup MaxAB
The Egyptian B2B e-commerce marketplace which connects food and grocery retailers to suppliers in underserved geographies has just raised a USD 6.2 Mn seed round. The funding round which was co-led by early-stage investors Beco Capital, 4DX Ventures and Endure Capital, with participation from 500 Startups, Outlierz Ventures and other local investors is said to be one of the largest seed rounds to be secured by a startup in the MENA region.
Yousef Hammad, Managing Partner at Beco Capital, said “This is Sparta” was the first impression I got when I met this team of warriors, battling one of the biggest inefficiencies on the country’s balance sheets. By leveraging technology, MaxAB is redefining the grocery supply chain in Egypt to fit the requirements of the micro retailers who make up 90% of the grocery market. The metrics they have recorded in such a short period are impressive, and we expect to continue to see double-digit growth as they scale.”
The startup which was reportedly among the first five companies to receive investment in March this year from Outlierz Venturez in Africa. The funding amount will be used to widen the company’s reach across Egypt, hopefully reaching 50% of Egypt’s population within the next two years. The funding will also be used to expand across North Africa, scale its platform and enhance its technology.
MaxAB was founded in November 2018 by Mohamed Ben Halim, former Operations Manager at Aramex and Belal EL-Megharbel, former General Manager at Careem, which has recently been in the news following its acquisition by the dominant ride-hailing app, Uber. Belal is also a co-founder of Glimp, a broadband comparison website in New Zealand.
As claimed by the startup, within a year of operation, the team of 270 has recorded 50% month-on-month growth, worked with around 9000 on-boarded retailers and has seen around 40,000 shipments with 680 products ranging from groceries, beverages, dairy, confectionery and non-food products.
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The startup provides an app where brands and retailers are connected. The brands can access both real-time demand monitoring and business intelligence tools and the retailers enjoy ordering from a wide variety of stock online as well as access to credit facilities.
Egypt’s FMCG food retail market is valued at USD 45 Bn, characterized by heavy fragmentation and multilayering. A gap exists between over 400,000 traditional retailers and FMCGs. MaxAB is seeking to close it by leveraging technology and innovative supply chains.
According to Co-Founder and CEO Belal El-Megharbel, retailers in Egypt have been underserved, having to choose from a limited variety of products. They also have to deal with multiple wholesalers all the while facing limited access to credit. FMCGs also have their fair share of hassles, with no visibility on market trends, demand patterns and business needs of the retailers.
“We are using data and analytics to understand purchasing and retail behaviours, as well as make the end-to-end process of brands seamless and convenient. This will enable FMCGs to make informed decisions about their purchasing, which will ultimately have a positive effect on their bottom line and catalyze one of the biggest markets in Egypt. This investment round will allow us to accelerate our growth plans and develop new products and services throughout North Africa using the first of its kind B2B e-commerce platform,” says Belal El-Megharbel.
