Jumia has become the first e-commerce company operating in Africa to list on the New York Stock Exchange

Gova-Media

6 years ago

The largest e-commerce operator in Africa, has officially started trading on the New York Stock Exchange on Friday April 12 as “JMIA”, with shares beginning trading at $18.95, and closing at $25.46. The company offered 13.5 million shares for purchase and raised $196 million.

Jumia’s IPO is now the first major African-focused venture-funded tech company to go public, and will definitely be the flagship for a business sector that is still untapped. Jumia’s major executives were present to ring the opening bell on the exchange ahead of the launch.

This IPO is now another big milestone for Jumia. The company in 2016 became the first African startup unicorn, achieving a $1 billion valuation.

Little history about Jumia

Founded in Lagos in 2012 by Nigerian co-founders Tunde Kehinde and Raphael Kofi Afaedor, along with ex McKinsey Jeremy Hodara and Sacha Poignonnec, the company quickly expanded its operations to 5 African countries: Egypt, Morocco, Ivory Coast, Kenya and South Africa.

Fast forward 2014, the company is present in 14 African countries, including Uganda, Tanzania, Ghana, Cameroon, Algeria and Tunisia. The company offers various services such as: Jumia Food (an online takeout service), Jumia Flights (for travel bookings) and Jumia Deals (for classifieds). Both co-founders Tunde Kehinde and Raphael Kofi Afaedor departed the company in 2015 to form other startups in fintech and logistics.

Jumia has created a complete e-commerce fulfillment platform calledJumia Services, a network of its own-managed and third-party warehousing, order processing, and logistics service providers

The company has also opened itself up to Africa’s traders by allowing local merchants to sell on its online platform. There’s currently over 80,000 active sellers on the platform.

The future of Jumia and e-commerce in Africa

An important question surrounding Jumia, is whether the startup can generate profits, as it has been having important losses in the past years, including negative EBITDA of €172 million in 2018. However, its
revenues have increased steadily, up 11 percent to €93.8 million (roughly $106.2 million) in 2017 and up again to €130 million (or $147 million) in 2018. Also, it is to be noted that most e-commerce startups face major losses for years before being profitable.