Jumia, an emblematic company of Africa Internet Group (AIG) founded in 2012, is the first e-commerce website in Africa and currently covers the largest markets, both in terms of population and GDP. The group recently raised more than €75 million with Axa. Orange joined the investors in early April by injecting the same amount. We met the Chairman and CEO.
Leaders League. Jumia has experienced continuous growth since 2012 to become an e-commerce leader in Africa. What are the reasons for this rapid success?
Jérémy Doutté. The market is more of a success factor than the team or the quality of execution, and figures confirm our early intuition. AIG/Jumia is the only group to have had the audacity of conducting this project in multiple African countries and the ability to raise the necessary funds to start work. The culture of AIG, mother group of Jumia, also accounts for this success: difficult situations do not scare us, and we love complexity. In spite of existing opportunities, few companies wanted to go to Africa due to difficulties, especially in logistics. There is thus no miracle. The amount of our work done is incredible, and we spend a lot of time on the continent and 99% of our staff is in Africa today. So this success is the sum of a lot of work, daring and… in particular resilience!
Leaders League. What are the challenges for entrepreneurs in Africa?
J. D. Africa is the new frontier for business, full of opportunities for those who want to work well, but we must naturally think of risks and ask the right questions. It is still very difficult to find well-equipped talent to deal with start-ups’ problems. Places like Silicon Valley and Berlin have allowed talented entrepreneurs to exchange, meet and form networks. This is not yet the case of Africa, which represents a real handicap. Moreover, entrepreneurs naturally need funds to start their business, but the African financing market is still too small.
Leaders League. What advice would you give them?
J.D. Africa requires long-term thinking. You need a lot of patience, a good support system and fierce determination!
Leaders League. The funds raised recently reach beyond the scope of Jumia,since the partnerships with Axa and Orange concern AIG’s capital. How will the funds be allocated?
J.D. Jumia is a very important brand to AIG and benefits from a very substantial portion of this fund allocation. E-commerce is an industry that needs considerable funding for its development, due to practical reasons: working in e-commerce in Africa, you have to deal with infrastructure that is less efficient than in the US and Europe. This requires powerful technology to generate high traffic, an effective payment system and efficient logistics. As such, this capital is usually dedicated to building infrastructure facilities to support the company’s development. We are going to invest heavily in technology to become a benchmark in Africa.
Leaders League. AIG’s other investors are mainly telecom players, with Axa being the exception. What is the value of an insurer and financial player as a new partner?
J.D. Axa is a highly involved company that sees Africa as the next source of global growth: it is a true strategic alliance. Ultimately, we might even become an insurance product distribution network ourselves.