KENYA – B2C e-commerce company Copia Global has raised US$50 million in a Series C equity round led by Goodwell Investments, coming three years after its Series B round of US$26 million
The new financing round welcomed new investors such as Zebu Investment Partners, the U.S. International Development Finance Corporation (DFC), and Koa Labs, as well as past investors Lightrock, German development finance institution DEG, and Perivoli Innovations.
According to Crunchbase, the company has raised US$53 million, but including its Series C, Copia’s total funding since inception in 2013 now stands at US$103 million.
Copia Global was founded in Kenya by Tracey Turner and Jonathan Lewis as a B2C e-commerce platform to serve Africa’s middle- and low-income African consumers.
The company said in a statement that it harnesses mobile technologies, a network of local agents, and proprietary Copia Logistics to reach a market that traditional retail and Western e-commerce models cannot.
According to IMF, consumer spending in Africa is projected to reach over US$2 trillion in the next three years and the continent’s middle class is the primary driver of this growth.
However, their shopping needs are not adequately served because of the high logistics costs that make Western-style e-commerce companies such as Jumia operate unprofitably.
Copia, on the other hand, runs a profitable business because of how it approaches the market as it focuses on customers in rural areas that struggle to access the same goods and services in terms of choice, price value and reliability that similar consumers in urban areas or of higher income levels can access.
And though this target market can be hard to locate and individuals may have smaller wallet sizes, their number — which Copia says is about 750 million people across Africa — and collective purchasing power present an opportunity, especially when a company thinks hyperlocal.
The company is building a sustainable business that involves a three-way relationship with customers and 30,000 agents in different communities across Kenya and Uganda.
It is a well-known fact that low-income customers in Africa often distrust e-commerce platforms and most of them would prefer to go to a physical store and get what they want, irrespective of the long distances.
As a strategy, Copia recruits small business owners, who have already established some level of familiarity and trust with customers, and trains them to become agents.
Copia’s value proposition is solid with goods not generally available in proximity to the average consumer, said the CEO.
Goods such as building materials or medicine where customers would typically travel to the nearest city or send a relative to get.
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