Tag: Egypt

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MVP Match, a tech-talent marketplace, raises $5M from Stage 2 Capital

Tech-talent marketplace MVP Match has raised €5 million ($5 million) seed funding from Stage 2 Capital to double down its strategy for pairing companies with talent from across the globe.

The Germany-based startup plans to use the funding to build new hubs in Africa and Europe, grow its team, and re-launch its proprietary platform to make “finding and working with tech talent easier than ever before.”

The plan to grow its reach follows the launch of a new hub in Egypt that MVP Match will use to tap talent in Africa — with the aim of creating more networks in the region. The hubs, which include the existing ones in Lisbon (Portugal) and Tbilisi (Georgia), are intended to help its more than 100 clients hire local talent without having to establish operations in those jurisdictions.

“We see entering Egypt as the first step in our exciting journey to bring the entire continent into the global talent pool. By setting up a local presence and working closely with the local talent, we will be able to really open up this market to our clients. And, with interesting projects from world’s leading product companies comes knowledge transfer that the local senior talent seeks, just as much as fair working rates,” MVP Match CEO, Levin Wense told TechCrunch.

Manara gets $3M to grow tech talent pool in the Middle East and North Africa

Wense, who founded the startup in 2020 together with Philipp Petrescu, added that MVP Match acts as an Employer of Record, which enables it to manage the whole recruiting process including the establishment of local office spaces and talent onboarding. This helps recruiters to build teams in other regions without worrying about the lengthy recruitment process and paperwork.

“With available locations such as Egypt, for example, our clients and other global companies can scale their products and engineering teams in nearshore, best value-for-money regions. We can provide them with complete legal infrastructure to permanently employ local talent without physical local presence,” said Wense.

“For fast-growing companies that operate on crowded markets, being able to launch a nearshore hub with a fully equipped office space within weeks and in a process build a more diverse and inclusive team can be a difference between delivering or not on their product roadmaps and strategic goals,” he said.

MVP Match said it uses product and technology executives like CTOs, and experienced domain experts to vet talent before recommending them to companies. Vetting includes tech-related challenges and personality interviews, to ensure that their clients, which include Voya Financial and accounting firm PwC, are matched with the right talent.

Of their decision to fund MVP match Stage 2 Capital partner Anubhav Maheshwari said: “Engineering, product, and design roles are critical, yet hard-to-fill positions. They’re in high demand by both growing technology companies, as well as non-tech companies undergoing rapid digital transformation.”

“With dedicated focus on providing an exceptional experience both for customers and remote talent alike, MVP Match is rapidly connecting proven and experienced professionals, wherever they may be located, with exciting and high-impact projects.”

Gloat nabs $90M to build AI-powered internal jobs marketplaces

Stage 2 Capital launches $80M Fund II targeting B2B software startups

 

MVP Match, a tech-talent marketplace, raises $5M from Stage 2 Capital by Annie Njanja originally published on TechCrunch

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Founders of well-funded Egyptian B2B startup Capiter fired following fraud allegations

Last September, Egyptian startup Capiter raised $33 million in Series A funding to compete in the country’s growing B2B e-commerce and retail space. Fast-forward a year later, the startup has laid off multiple employees and now its CEO and COO have been relieved from their duties after allegedly mismanaging funds.

Here’s what we know so far. Between June to July, several ex-employees of Egyptian startups, including Capiter, wrote posts about layoffs at their respective companies even though the employers never addressed them publicly. Other companies include OPay Egypt, elmenus, ExpandCart and Brimore.

Some sources told TechCrunch that Capiter had laid off at least 100 staff in those two months. Others described a workplace with poor management and no structure and a company finding it hard to onboard merchants to its platform while running out of money simultaneously. The company had only a month runway as of August, they said. TechCrunch reached out to Capiter at the time but received no response. 

As a result, Capiter investors have been searching for potential buyers to absorb the struggling company in the form of an acquisition or merger. This information was further corroborated in a local news report where Capiter’s Board allegedly said that the executives had refrained from appearing before the board of directors after internal disturbances and disagreements over their management method. Another publication stated the founders had not been reporting to the board, its representatives and shareholders during on-site in-person due diligence for a potential merger. 

Before Capiter, Mahmoud was the co-founder and COO of Egypt-born and Dubai-based ride-hailing company SWVL (the company, which went public via a SPAC deal last year, laid off 32% of its staff this May). With his brother Ahmed, he launched Capiter in 2020 as an FMCG platform that allows small and medium-sized retailers to order inventory, arrange delivery and access financing to pay for goods. Some of its competitors include MaxAB and Cartona in Egypt, and in Africa, Wasoko, TradeDepot and Chari. 

Capiter had 50,000 merchants and 1,000 sellers with more than 6,000 SKUs on its platform when the founders spoke to TechCrunch last September. In the interview, they said Capiter was on its way to reaching an annualized revenue of $1 billion this year. And like many startups in Africa and globally, Capiter hired aggressively last year to meet its targets. 

However, 2022 has taken an unexpected turn for many tech startups as they deal with uncertainty arising from increasing interest rates and other factors that have a trickle-down effect on venture capital. News of layoffs, flat rounds and cutbacks from startups in various sectors — especially those that raised a lot of money within the past 18-24 months, such as Wave, 54gene, Kuda, and Marketforce — have been more widespread despite the continent boasting a better VC total by the end of Q2 2022 compared to Q2 2021. 

Egyptian startup Capiter raises $33M to expand B2B e-commerce platform across MENA

B2B e-commerce platforms operate either asset-light or inventory-heavy models. The latter requires more capital and for Capiter, which employs a hybrid model, it’s unclear how the company has exhausted its funds and is already looking to sell after raising millions from Quona Capital, MSA Capital, Shorooq Partners, Savola and others last year. Capiter’s investors declined to comment on the matter but issued an email statement.

“The Board and shareholders have initiated an internal investigation and therefore are not at liberty to comment on the news or allegations circulating the social media for the time being. The Board and shareholders are also working closely with relevant stakeholders, legal and HR teams as well as the legal authorities for an external investigation on this matter.”

Meanwhile, according to local reports, the company’s chief financial officer Majid El Ghazouli will act as interim CEO. Mahmoud didn’t respond to comment. 

Update: CEO Mahmoud Nouh, in response to the allegations, said, “I deny the false allegations and that I haven’t received any official notice of what’s above [referencing the statement about his and Ahmed’s dismissal].”

This is a developing story…

BharatPe founder Ashneer Grover siphoned off money, Indian startup says

Founders of well-funded Egyptian B2B startup Capiter fired following fraud allegations by Tage Kene-Okafor originally published on TechCrunch

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YC-backed Zywa, a neobank for Gen Z, raises $3M to expand across MENA

Dubai-based Zywa, a neobank for Gen Z, plans to fuel its growth in the United Arabs Emirates (U.A.E), and to kick-start its expansion to Saudi Arabia and Egypt after raising $3 million seed funding at over $30 million (110 million AED) valuation. The new funding follows the $1 million pre-seed backing it secured in February this year.

Goodwater Capital, Dubai Future District Fund, Rebel Fund, Trampoline Venture Partners, Zemu VC, a number of prominent European family offices, and strategic angel investors participated in the latest round.

Zywa was founded by Alok Kumar (CEO) and Nuha Hashem (CTO) in 2021, inspired by their lived experiences in the gulf region, where they primarily used cash or their parents’ cards to make payments. They created Zywa as a social banking app and prepaid card to make it possible for the Gen Z (between the age of 11-25 years) to receive money, manage it, and make payments.

The app brings convenience to parents too as it enables them to send money to their children, and to monitor their spending and saving habits.

“Gen Zs in the UAE spend about AED 5B+ every year, and still rely on cash or their parents’ cards despite having options like supplementary cards issued by their parents’ banks. While these options give access to digital payments, they are not fundamentally designed for Gen Z, and this is where we add value,” Kumar, said in a statement.

“We are Gen Z building for Gen Z, and we aim to grow our product as they grow, to be the only financial services platform they will ever need…The seed fund will help us focus on product, growth and strategic partnerships to accelerate our efforts in the UAE and Egypt markets, while prepping us to launch in Saudi Arabia by early 2023,” said Kumar.

YC-backed Zywa, a neobank for Gen Z, raises $3M to expand to Middle East and North Africa

Parents too use the app to send money to their children, and to monitor their spending and saving habits. Image Credits: Zywa

The strategic partnerships Zywa is exploring, include working with schools to host workshops and hackathons to further expose it to its target clientele. It also plans on partnering with teen-led businesses to enable them sell on the app, in addition to discount partnerships with brands that are popular with Gen Z.

Zywa also plans to introduce a social element to its app by enabling its users to share photos or videos of their purchases, and to react to their friends’ purchases on different feeds.

The fintech is also adding community-based value-add services like a platform it is building within the app to enable users to apply for internships at Zywa and partner startups, as a strategy for encouraging users to start earning early. This is in addition to gamifying finance by rewarding those that save, budget and invest their money.

“Our reward system “Zems (Zywa gems) and Zyons (Zywa coins)” rewards users for healthy financial habits and are currently used as a loyalty mechanism. Once we reach a set volume of users (100,000+ users), we will tokenize the “Zems and Zyons”, which can be used for peer-to-peer transfers, to purchase items at their favorite stores and settle with merchants directly through the tokens, eliminating scheme involvement through a closed-loop system, thus adding additional revenue streams for us,” Hashem, told TechCrunch.

Zywa earns from card interchange revenue, and through merchant or brand partnerships.

Zenda gets $9.4M to streamline school fee payment and management

Manara gets $3M to grow tech talent pool in the Middle East and North Africa

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US-based fintech Umba buys majority stake in Kenya’s Daraja microfinance bank

Umba, a US-based digital bank with a focus on emerging markets, has acquired a majority shareholding of Daraja, a Kenyan deposit-taking microfinance bank, for an undisclosed amount.

Kenya’s monetary authority, the Central Bank of Kenya (CBK), said Umba had taken up 66.6% shareholding, an acquisition that is expected to fast-track Daraja’s digitization.

This comes after Umba announced raising $15 million in pre-series A round in April this year, when it also made public its plans to expand beyond Nigeria, to Kenya, Ghana and Egypt. Umba has so far raised $17.5 million from investors like Tom Blomfield, the co-founder of Monzo, Lachy Groom and ACT Ventures, Lux Capital, Palm Drive Capital, Banana Capital and Streamlined Ventures participated, and Costanoa Ventures.

Digital bank Umba raises $15M, plans to expand into three new African markets

The fintech, which was founded by Tiernan Kennedy and Barry O’Mahony, offers a wide range of financial products including free accounts, interbank transfers, peer-to-peer transfers, bill payments and loans at a monthly interest of 10%.

“The investment by UMBA will strengthen Daraja MFB’s business model. In particular, it will support the digitization of Daraja MFB as it moves to providing ‘anytime anywhere’ services to its customers. This is aligned to CBK’s vision of a microfinance banking sector that works for and with Kenya,” the CBK said in a statement.

The CBK said Daraja, licensed in 2015 and whose main customers are small and medium enterprises, has a market share of below 1% of the microfinance banking sector in Kenya.

Daraja will give Umba a stronger presence in the country’s competitive financial sector, and an opportunity to offer more targeted services, while also giving the micro-finance a lifeline — in an industry that has been strongly disrupted by digital lenders.

Its deal with Daraja comes months after Branch International, another silicon valley based fintech with operations across Africa, bought a majority stake in Century microfinance bank. Such acquisitions give fintechs access to existing financial services clientele, and permits them to offer additional banking services, which they would otherwise be restricted from supporting.

Umba told TechCrunch in an earlier interview that, in addition to geographical expansion, it is planning to issue debit cards, support savings accounts, and enable stock trading in the coming months.

Ghana’s fintech Fido raises $30M to roll out new products and expand across Africa

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Daily Crunch: Cartona will use $12M Series A to expand its Egypt-based, B2B e-commerce platform

To get a roundup of TechCrunch’s biggest and most important stories delivered to your inbox every day at 3 p.m. PDT, subscribe here.

Happy new week! Christine went on a well-deserved break, so you’ll have to deal with a double dose of my awful puns and worse headline shenanigans for a bit.

Oh! And we have a live Q&A session tomorrow at noon PT on Twitter Spaces about what a 409A valuation is and why you should care. Our very own Natasha Mascarenhas and Anita Ramaswamy will be speaking with Sumukh from AngelList and Phil from Equityzen. You can set yourself a handy reminder here. – Haje

The TechCrunch Top 3

  • Verticals exploration: “In a market like Egypt, retailers are not okay with the concept of paying for [buy now pay later] with interest at the end of the month. They prefer it to be a part of the product prices and to feel it embedded through the order cycle, making us a bit different,” Cartona’s CEO told Tage, as the company raises $12 million.
  • Snap snaps in half: Snap took a beating after releasing its Q2 earnings and investors are having none of it. The stock plummeted 40% on Friday, with investors adjusting their expectations for the once-in-vogue social media platform, Lucas reports.
  • Healthcare Prime? Amazon bought medical provider One Medical for almost $4 billion. If that left you scratching your noggin, Alex, Miranda and Walter have three takes on why and how that makes sense over on TechCrunch+.

Startups and VC

Since its launch nine years ago, Seedstars has invested in 81 companies in over 30 emerging countries. Now the firm has set a goal of investing in 100 more startups with the launch of its second emerging market seed-stage fund, Catherine reports.

BAI Capital, the storied China-focused venture investment firm that was formerly known as Bertelsmann Asia Investments, has raised $700 million to back Chinese companies that are part of the country’s structural reform as well as those expanding overseas, reports Rita.

Devin reviews Framework’s modular laptop computer. “Framework isn’t necessarily trying to get people already wild for DIY to go upscale — this is about capturing people who’d like a little more flexibility and reusability but can’t find it in mainstream devices”: I thought this helped to cement the target audience a bit. If that sounds like you, give it a read!

Go on then, have a few more:

  • Not-so-secure messaging: Popular video calling and messaging app JusTalk claims to be both secure and encrypted. But a security lapse has proven the app to be neither secure nor encrypted after a huge cache of users’ unencrypted private messages was found online, Zack reports.
  • Working remotely or not remotely working: 77% of managers said they’d consider firing employees or cutting their pay for refusing to return to the office. Allwhere launches out of stealth to help companies manage their remote workforces better, Kyle reports.
  • Sir? Is this your lead balloon? Shares of Zomato dropped as much as 14% to a record low on Monday, the end of the lock-in period for investors who had stakes in the company prior to the initial public offering, Manish reports.
  • Finding all the solutions all at once: World Fund, a newcomer in climate-VC land, is taking the lead in a $128 million round for IQM, with hopes the Finnish quantum computing company will one day deliver carbon cuts by the megatonne, Harri reports.
  • You’ve got the power: Perfect for people wanting to charge multiple high-draw devices at once, Anker’s new GaNPrime charger lineup is cranking out up to 150w of power I reported today.

How e-commerce brands can outlast this market downturn

Lifeguard float; e-commerce survival downturn

Image Credits: Roc Canals (opens in a new window) / Getty Images

Inflation is up and consumer confidence is down, which is why e-commerce startups that hope to weather the ongoing downturn should expand their product offerings. Does that sound counterintuitive?

“The more complementary and additive a product is to your catalog, the larger your cart size, and the more likely a customer is to return,” says Bennett Carroccio. Prior to co-founding Canal, he worked with hundreds of companies as a consumer investment partner at Andreessen Horowitz.

In this TC+ post, he identifies two cost centers that are the easiest to control and shares three tactics for “staving off the brand-pocalypse.”

How e-commerce brands can outlast this market downturn

(TechCrunch+ is our membership program, which helps founders and startup teams get ahead. You can sign up here.)

Big Tech Inc.

Big tech – including Facebook and Google – have signed a pact to self-regulate over harmful content shared across digital platforms in New Zealand. Critics say it’s a ‘weak attempt to preempt regulation’, reports Paul

Rita reports exciting news for lovers of self-driving cars – there are plenty of autonomous driving vehicles testing on the roads of Shenzhen today: Pony.ai, Baidu, DeepRoute, AutoX, you name it. To date, these vehicles haven’t been the unmanned vehicles that tech upstarts envision for the future. That is changing from August 1st, as driverless car become legal in Shenzhen, China.

Also in the land of Automotive, Cruise is making good on its promise to launch an autonomous driving service in Dubai. Just a few weeks after the General Motors-backed AV company officially launched its commercial driverless operations in San Francisco, Cruise has sent two of its autonomous vehicles to Dubai to begin mapping the city in preparation for a planned launch in 2023, Rebecca reports.

More, more, always more:

A bit spicy for the mouse: In the U.S., Disney+ rolls out a number of R-rated films, as ‘Deadpool,’ ‘Deadpool 2’ and ‘Logan’ make it onto the streaming platform, writes Lauren.

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Why you have to pay attention to the public markets this week

Hello and welcome back to Equity, a podcast about the business of startups, where we unpack the numbers and nuance behind the headlines.

Alex and Grace are back to cover the biggest and most interesting technology, startup and markets news. Sitting as we are on the precipice of a huge data dump, we had lots to chat through!

No live show this week, just three episodes! Hang in there we got you!

Equity drops every Monday at 7 a.m. PDT and Wednesday and Friday at 6 a.m. PDT, so subscribe to us on Apple Podcasts, Overcast, Spotify and all the casts.

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Egyptian B2B e-commerce platform Cartona raises $12M to scale and explore new verticals

Startups that solve the supply-chain and operational challenges of players in the fast-moving consumer goods (FMCG) industry–by helping buyers access products from sellers on a single platform–keep attracting venture capital from investors.

Cartona, one of the major players digitizing the traditional trade market, including mom-and-pop stores, FMCG producers, wholesalers, and distributors in Egypt, has raised $12 million in Series A funding. Jordan and U.S.-based early-stage venture capital firm Silicon Badia led the round, which also welcomed participation from the SANAD Fund for MSME, an impact investment fund for the Middle East and North Africa, Arab Bank Accelerator and Sunny Side Ventures.

Investors such as Global Ventures and Kepple Ventures doubled down less than a year after participating in the company’s $4.5 million pre-Series A funding last September. At the time, Cartona was present in three Egyptian cities; it’s now in eleven. Per a statement, the investment will allow the startup, launched in 2020, to cover all of Egypt’s governorates, grow its product, technology, and services, and explore new verticals beyond FMCG.

“So we believe that with this money, we would reach profitability. We will use this money for sustainable growth and only sustainable growth. We won’t expand like crazy without having positive unit economics in every city,” CEO Mahmoud Talaat told TechCrunch in an interview. “We plan to cover all the cities in Egypt, focus a lot on technology and product.”

Cartona’s platform allows buyers to order inventory from a network of curated sellers via an app that provides a communication tool for promotions and a dashboard for market insights.

The company operates an asset-light marketplace where it does not own a single product or vehicle. This model has led to customer complaints on both sides of the platform. And as a result, Talaat said Cartona had to focus more on its technical integrations with big manufacturers and their warehouses, which has created more upside for the business. With these integrations, he said Cartona could simultaneously pursue capital efficiency and growth while scaling its embedded finance product.

Providing loans, working capital, or BNPL to micro and small businesses is the sweet spot of B2B e-commerce and retail marketplaces in Africa. But how they provide this service differs. CTO Mahmoud Abdel-Fattah claims that in Egypt, a market with other upstarts such as asset-heavy MaxAB or hybrid model Capiter, Cartona stands out by integrating BNPL services into its marketplace processes without the help of a third-party provider. So instead of getting small businesses to pay their loans each month with interest like other platforms, Cartona allows them to repay these loans every time there’s a product shipment.

“In a market like Egypt, retailers are not very okay with the concept of paying for BNPL with interest at the end of the month. You do not want to think you’re paying more interest with an external company giving you these working capital loans. They prefer it to be a part of the product prices and to feel it embedded through the order cycle, making us a bit different.” Talaat added.

Cartona lends out of its balance sheet for now. But the executives say the company expects to receive some credit lines and venture debt from local and international partners by January next year.

Cartona

Image Credits: Cartona

There are over 400,000 shops and thousands of international and local brands across Egypt, with the sector growing annually by 8%. Reports also say the overall retail market size is $120 billion, with the food & beverages market worth $70 billion. The massive opportunity this presents to platforms such as Cartona has attracted investors like Silicon Badia into the B2B retail sector. According to the firm’s founding managing partner, “the market is hungry for these type[s] of solutions, and we believe Cartona’s asset-light approach will allow them to serve as many marketplace participants as possible in a highly efficient manner.”

In our interview with Cartona’s executives last year, the company had 30,000+ merchants and processed over 400,000 orders with an annualized gross merchandise value of EGP 1 billion (~$64 million). It has doubled some of its numbers since then. Talaat said the company now serves 60,000+ merchants and processed over 1 million transactions with an annualized gross merchandise value of EGP 2.3 billion (~$120 million). Cartona has more than 1,500 distributors and wholesalers on its platform and 200 FMCG companies, including big names like Unilever and Henkel. These numbers are up from last September’s numbers of 1,000 distributors, wholesalers, and 100 FMCG companies.

The founders say they want to build Cartona to become a better technology partner for these FMCG brands. Abdel-Fattah, the executive in charge of handling these technical integrations, said, “We started with very big FMCGs, but everyone, including multinationals, is interested because now they see our value. We are not competing with them or bringing down their prices. We’re not subsidizing their products as competition sometimes does. We’re just connecting them with the retailer, so it’s about making the process seamless.”

Cartona gets $4.5M pre-Series A to connect retailers with suppliers in Egypt

MaxAB, the Egyptian B2B food and grocery delivery startup, raises $40M for expansion

Egyptian startup Capiter raises $33M to expand B2B e-commerce platform across MENA

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As the global venture capital market slows, Africa charts its own course

Although Africa’s venture capital totals remained afloat in the first quarter, some investors and tech stakeholders think there’s still a good chance the continent will join the rest of the world in a slowdown.

Experts told TechCrunch that most recently announced deals were finalized months before macroeconomic challenges — high-interest rates, war, inflation — hit the global VC landscape. This means there’s a lag in what’s reported as the current state of VC on the African continent. Thus, as startup funding decreases in the U.S. and Europe, the consensus is that the economic downturn will soon start affecting developing markets — Africa, in particular.

“The moment of truth will be the end of the summer,” Max Cuvellier, co-founder of The Big Deal, told TechCrunch. “August [and] September in particular because this is when we saw a boom last year.”

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Last year, African startups received more than $1 billion in funding during those two months. Anything less than that contributes to a year-over-year decrease, Cuvellier noted.

Stephen Deng, co-founder and partner at DFS Lab, added to that, saying that the same investors that have inflated valuations in later-stage U.S. companies are also the same investors marking up African companies.

“I would not understand why, in the African context, this trend would not eventually hit the continent as well and that we’d see a slowdown,” Deng told TechCrunch. “One of the better-case scenarios is that we still see increased funding, but not the same type of percentage growth year on year.”

“If these global funds pull out and do less, it also means more room for participation from local funds into the extensions or their pre-Series A.” Sherpa Ventures co-founder Aaron Fu

Large firms like Tiger Global and SoftBank have already taken a beating in developed markets. Similarly large firms that earmarked a part of their funds into African startups might reduce the pace at which they invest on the continent, local investors told TechCrunch.

Funding data shows the African ecosystem has already seen inflows of around $2.7 billion in the first half of this year. That’s in excess of double what the continent raised by this time last year. In 2021, Africa produced five unicorns while raising $5 billion in total venture capital funding: Flutterwave, Chipper Cash, OPay, Wave, and Andela.

No unicorns have been created so far in H1 2022. It’s true that stakeholders can perhaps overlook this given that four unicorns were announced in H2 2021, but it would be naive to project the same for the rest of the year; we’re in a completely different market.

But some experts say Africa might not witness a massive drop if large Africa-focused firms keep cutting checks.

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A look into the British DFI’s plan to invest in African economies, venture funds and tech startups

On April 4, the U.K.’s development finance institution, Commonwealth Development Corporation (CDC) Group, formally changed its name to British International Investment.

As part of the name change, the development finance institution (DFI) announced that it surpassed its pledge to invest £2 billion in Africa over the last two years. It was a reminder of the series of work BII had accomplished on the continent leading to this point: over 600 portfolio businesses with a value of $4.2 billion. Nigeria is its biggest investment market in Africa, with a portfolio of $570 million.

Within this period, the impact investor backed several firms in various sectors like banking, trade, private equity, and venture capital. Some deals include $300 million direct equity in DP World, $75 million direct debt in Stanbic IBTC Bank, $100 million in Standard Chartered, a $20 million investment in Verod Cap, and a $15 million investment in the TLcom TIDE Africa Fund.

In a new development, BII said it will invest between £1.5 billion and £2 billion yearly from 2022 and 2026 in “Africa, parts of Asia and the Caribbean.” But narrowing this to just Africa, the impact investor is looking to mobilize $6 billion into the continent across these five years, Benson Adenuga, the firm’s head of office and coverage director for Nigeria, told TechCrunch in an interview.

“We want to do a lot in Africa. Africa is one of the key strategic markets for BII. It has been since inception, as it continues to be even with our current strategy for 2022-2026,” Adenuga said. “The key reason for that is you’ve got over a billion people in Africa, the level of developmental needs across Africa is very significant. We see a very significant role that DFIs like us who have the experience, capital and skill sets to support development can bring to the table.”

BII has adopted a strategy to make calculated, not sporadic, investments across key sectors: infrastructure, financial services, manufacturing, food and agriculture, health, education, and real estate and construction. The strategy is to divide countries into four categories based on market development and specific risk profiles. They include mature, powerhouse, stable and fragile markets. “What we do in each country is a function of where the country stands,” noted the director.

In matured markets such as South Africa, Adenuga said BII will have an on-the-ground presence and offer its full suite of services ranging from climate finance, funding for financial inclusion, and equity and debt financing. BII will have offices in powerhouse markets like Nigeria, Egypt, and Kenya and offer equity and debt financing to projects in these countries. For stable markets such as Ghana, BII will get representative offices that will provide investments with the option to go all in if there are noticeable upsides. And in fragile markets, BII will work through intermediaries and partners to make investments across key sectors on its behalf.

“We offer these across the countries and deploy using various instruments, ranging from equity to debt and everything in between. That is how we tend to approach Africa.”

Progress so far: banks, VC firms and startups

Around 57% of the African population have little or no access to financial services. And one primary goal of the BII’s involvement and investments in Africa is to bring more people into the financial stratosphere. In its dealings so far, the impact investor is not only constructing avenues to increase financial inclusion but also increasing opportunities for women because they tend to be more financially excluded than men.

In February, FirstBank, one of Nigeria’s largest banking groups, received a $100 million credit facility from the impact invest to lend to small and medium businesses in the country. Adenuga said 30% of that money is earmarked specifically to women-owned and led SMEs.

BII has also provided investment to TLcom Capital, one of the largest pan-African venture capital firms. This January, TLcom reached the first close of its $150 million second fund; BII contributed $10 million of that money. This investment follows the impact investor’s $15 million commitment to TLcom Capital’s first fund of $71 million.

TLcom Capital is just one of the many firms where BII is a limited partner. It has put money into VC and PE firms like Sawari Ventures, AfricInvest, Novastar Ventures, Verod Capital and Ezdehar Management.

Investing in startups through these firms made sense for BII, considering it isn’t traditionally structured to take on early-stage risk by partaking directly. However, it becomes hard to ignore some of these businesses as they enter growth-stage phases and need more capital–most times beyond what venture capital firms can provide–to scale. BII has upped its game by investing directly in such businesses.

“We have operated as a growth capital company, with at least $10 million of investment and higher. There are several innovative businesses in early stages that we could not support before,” said Adenuga. “But we see a market gap when it comes to startups with a proven concept, a product on the market that is acceptable and needs more capital; we then come in and co-invest with our fund managers directly in the businesses.”

An example is its investment in B2B e-commerce platform TradeDepot. In previous rounds, BII had invested indirectly through Novastar Ventures as a limited partner, but in the TradeDepot’s Series B round, BII invested $5 million directly with Novastar on the startup’s table too.

BII and Novastar Ventures also backed TeamApt, a Nigerian fintech, in its $30 million+ Series B last year. The impact investor invested about $5 million. Other African startups that have received money directly from BII include M-KOPA, Paymob, Apollo Agriculture, and Pylon.

Big plans for climate finance

This week, BII announced its $20 million investment in Moove, a mobility fintech democratizing access to vehicle ownership in Africa. The company provides revenue-based vehicle financing and financial services to Uber drivers. However, unlike the other equity rounds, the Moove deal is a 4-year structured credit investment. BII said the funding will enable Moove to purchase and import brand new “fuel-efficient cars” into Lagos, which will be leased to drivers who can earn their way to asset-ownership over three to four years.

In an interview with TechCrunch, Moove co-CEO Ladi Delano said at least 60% of the vehicles the company finances will be electric or hybrid in the coming years. This grand plan of a company that has raised over $200 million in equity and debt fits well with BII’s climate finance objectives. It is one reason the impact investor is interested in the mobility company, according to Adenuga.

Moove raises $105M to scale its vehicle financing product across Asia, Europe and MENA

 

He said over the next five years, at least 30% of BII’s total new commitments by value will be in climate finance. It is the first time BII is making clear, explicit targets for climate finance, a development that will make it one of Africa’s world’s largest climate investors.

Last week, BII, which has offices in numerous African countries, announced plans to invest up to $200 million in hydropower projects across the continent alongside Norfund and Scatec. It follows other climate-focused projects BII has been involved with, such as New Forests and Energy Access Relief Fund–and smaller commercial ones like Lumos and Greenlight Planet.

“What we’re looking to do is to invest in businesses that lead to a reduction in emission, that support adaptation and resilience, and also help businesses to be able to adapt to the impact of climate finance,” the director said. “When we talk about climate finance, people tend to think about just investing in solar panels and renewable energy; it is that and much more. For example, climate-smart agriculture and green buildings are something that we will look at. In mobility, things like electric vehicles, converting from diesel to CNG, or clean-energy vehicles–those are some things that we will support as well. So it’s a comprehensive set of investments that we will try to do, which is quite critical for us.”

TLcom Capital targets $150M for its second fund to invest in 20 African startups

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Khazenly, an Egyptian on-demand warehousing and fulfiLlment platform, raises $2.5M seed funding

The e-commerce market in Egypt is expected to grow 30% to $7.5 billion this year, spurred by a growing number of younger shoppers and rising incomes.

Local merchants are essential in driving this growth, and solving their logistical and operational needs end-to-end is where new upstarts in Egypt notice the most opportunity. Khazenly, founded in mid-2021, is one such startup. It is announcing that it has raised $2.5 million in seed funding.

Khazenly was launched by Mohamed Younes, Osama Aljammali, Mohamed Montasser, and Ahmed Dewidar. It is an on-demand digital warehousing and fulfillment management platform that provides an omnichannel solution to help merchants digitize their businesses.

On a call with TechCrunch, chief executive Younes said Khazenly solves fulfillment issues for small and medium-sized merchants who focus on business and consumers. He argues that these merchants don’t have the resources to pull off renting a large warehouse and engage in manual processes when carrying out operations. Thus, Khazenly allows merchants and social commerce retailers to optimize their fulfillment processes digitally when selling online (B2C), via retail stores (B2B), marketplaces, cross-border, or a combination of these channels.

“There is no player in Egypt matching the digital experience that we already have to manage both B2C and B2B,” the CEO said. “Though we solve both aspects separately, we are solving a big pain in the market by automating both.”

Younes also touched on the company’s focus on convenience. According to him, this, alongside its multifaceted client approach and data/AI-driven product, sets Khazenly apart from similar platforms in the market such as ShipBlu, Flextock and Bosta. “The combination of all this through the same platform allows us to have a big differentiation,” he said.

The platform’s use of AI and big data– stemming from the CEO’s background in that space after spending several years at IBM and Huawei — allows it to inform merchants on what products to stock concerning location and demand. At the same time, the rest of the executive and management team have experience in other segments of the business, having worked for the likes of DB Schenker, Uber, Amazon and Baker Hughes.

Khazenly also offers other services in addition to its warehousing and AI capabilities. They include cross-docking, transportation, delivery and cash collection services.

“Our clients carry out all these seamless experiences using our digital platform. Also, beyond the current fulfillment, we do many activities with our clients and support them in marketing and other value-added services,” said Younis.

The chief executive said his company operates an asset-light model as it doesn’t own any of the warehouses or delivery vehicles. For the latter, Khazenly partners with over 100 last-mile companies to fulfill delivery for its merchants. These merchants are charged varying monthly subscription fees calculated from their space allocated in the warehouse and the projection of orders.

“After the launch of three weeks, we found that some of the clients cannot calculate how much space their restock will consume in the warehouse,” the CEO said. “So we developed a calculator in which the client puts in very nice scalar quantities and automatically calculates how much space they will consume in the warehouse, estimates the number of orders, and puts out a subscription range.”

Bosta raises $6.7M to expand e-commerce delivery business across Africa and MENA

While Younes declined to give exact figures on the number of merchants on its platform or gross merchandise value (GMV) processed, he said Khazenly’s GMV is in eight figures. At the same time, the company supports merchants in over 16,000 self-service activities. Some brands that have used Khazenly’s digitized fulfillment services come from industries like fashion and electronics to FMCGs such as XRPS by Tradeline and Mozare3.

The on-demand digital warehousing and fulfillment platform bootstrapped its way to a soft launch mid-last year and is just receiving its first institutional capital.

The round was co-led by regional VCs Arzan Venture Capital and Shorooq Partners. Participating investors include Camel Ventures, Averroes Ventures, and a couple of angels.

There’s been an increased global focus on building more resilient e-commerce supply chains. According to Laith Zraikat, a partner at Arzan, backing Khazenly proves that the “logistics tech and fulfillment sector is still up for disruption.”

Khazenly plans to continue expanding its portfolio of data-driven products, it said in its statement. One of the products is its mobile dark stores, an offering that allows items to get shipped faster off the back of a more-efficient warehouse forecast.

Younis stated that proceeds from the investment would be used to quadruple the company’s facilities as it follows a roadmap of building more AI and data-driven products and expanding geographically.

“We are very excited and proud of what we did the last few months. And I believe in the coming days we will do even more strategic and key milestones to let our merchants grow even more,” he said.

ShipBlu bags $2.4M for its e-commerce and fulfillment service in Egypt