Because Africa offers a huge untapped market for online retail.
When Rania Belkahia wanted to launch an e-commerce business in West Africa while still at business school in Paris, more experienced entrepreneurs warned the 23-year-old against the idea. “Don’t go for anything too complicated with your first company,” they said. “Africa is too far away. Do something simple to start with.”
The advice was well-meant, but Belkahia and her business partner, Jeremy Stoss, whom she had met at a strategy consultancy, ignored it, packed their bags and headed to Ivory Coast.
They set about persuading retailers in the city of Abidjan to distribute their products on the fledgling online platform, Afrimarket. They tried to register the company in France only for Belkahia to find that because she was foreign (Moroccan) and a student, she could not be appointed as its chairman.
Yet by 2017 Belkahia was part of a small delegation that accompanied French President Emmanuel Macron on an official visit to West Africa; last month she was hailed as an entrepreneurial star by French business magazine Challenges.
I do not trust ideas, I like to look at the data.
Rania Belkahia
Belkahia, now 29, was determined to prove the naysayers wrong. “When the door is closed, you must go through the window,” she says. Brimming with energy, in a smart suit and shirt, she is speaking in her offices near Paris’ Montmartre neighborhood. A pile of samples — toothpaste, deodorant and cleaning products — are on the table in front of her.
Demographic trends across Africa were ripe for e-commerce, says Belkahia, reeling off statistics: A fast-growing middle class is expected to surge by more than half between 2020 and 2030, and mobile internet penetration is set to reach 38 percent by 2020. Meanwhile, online retail penetration remains below 1 percent.
Belkahia emailed Xavier Niel, one of the richest men in France and a well-known angel investor, for backing. When he did not respond she simply repeated the attempt until she piqued his interest. Niel and other angel investors, such as Jacques-Antoine Granjon, founder of e-commerce site Veepee, invested 500,000 euros to fund a pilot phase for Afrimarket in Ivory Coast in 2013. A second fundraising round followed in 2015 to expand into four more West African countries.
So far, Afrimarket has raised a total of 20 million euros from investors, and its workforce has grown to 30 employees in Paris and 180 in West Africa. Initially it offered a curated online marketplace of goods stretching from food, beauty and home appliances to building materials and even live animals.
Rania Belkahia
Source Linkedin
Since then, Afrimarket has added two more lines. One is helping international brands market, sell and distribute products — it recently won exclusive online distribution for three of L’Oréal’s brands in French-speaking Africa. It has also launched a transport and logistics service that conducts “last-mile” delivery for third parties.
Afrimarket now has half a million clients who have made at least one transaction, with an average basket size of between 70 and 90 euros. It processes an average of 250,000 orders a month. The company had 30 million euros of revenues in 2018 and plans to double that this year.
Belkahia, who went to school in Casablanca in Morocco, before moving to France for college, says her bicultural upbringing has been an advantage. “I always had a foot in Europe and a foot in Africa. It has given me both perspectives and an understanding of Africa from on the ground,” she says. She travels to West Africa several times a month.
Belkahia initially trained as an engineer, “which allows me to be very structured and straight to the point,” she says. “I do not trust ideas, I like to look at the data.”
Like many other startups, Afrimarket has performed a pivot. Initially the plan was to sell online products from African retailers to the African diaspora in Europe, before deciding to target a much bigger market: the emerging middle class in West Africa.
Another big shift related to customer delivery. At first Afrimarket relied on other parties for logistics, which meant “we weren’t able to control the end delivery,” says Belkahia. “A customer who has a problem with their delivery is a customer lost.”
The answer was to oversee the entire journey from sourcing of goods through to the last-mile delivery. That came with challenges of its own because many of Afrimarket’s customers in rural areas do not have a formal address, and most pay cash on delivery.
“We work with GPS location so that the customer gives us the directions that allow us to place a point on the map,” Belkahia says. “The moment the delivery person is at the site he tags the address of the customer and then this is recorded in our system for future deliveries.” Afrimarket records data on distances, journey time and traffic volumes to develop its internal algorithms to optimize deliveries.
The moment the delivery person is at the site he tags the address of the customer
Afrimarket’s main competitor is Rocket Internet’s much bigger online shopping platform Jumia, and Chinese e-commerce company Alibaba is also starting to make a play for the continent. But Belkahia believes Afrimarket’s curated marketplace and own logistics give it an advantage, and is pressing on with plans to expand into Guinea, Ghana, Kenya and Tanzania. She says: “I want people to think of Africa and think, ‘We will call Afrimarket because they know Africa, they know Africans and they know how to operate there.’”
Read more: Meet the 22-year-old breaking the blood bank crisis in Cameroon.
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By Harriet Agnew
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Topics:
- AFRICA
- BUSINESS
- Ivory Coast
- Shopping
