Since it launched in 2012, it has been the poster child for African e-commerce. Until recently, it had the same status for the entire tech space since it was the first unicorn and the first to IPO on the New York Stock Exchange (NYSE). In its early days, the company inspired hope that Africa was fertile ground for e-commerce to blossom. And that sparked a wave of e-commerce startups across the continent. But today, the cold reality is setting in that the business is tougher than it looks. Over the last decade, Africa’s e-commerce market has grown exponentially. Data from Statista estimates that e-commerce revenue in Africa has risen from approximately $13 billion in 2017 to $37 billion in 2022. However, profit is still elusive to many startups on the scene. In Nigeria, Jumia’s premier marketplace, two of the biggest e-commerce names—MallforAfrica and Payporte—have shut down due to operational issues. Konga, another e-commerce company trailing Jumia in Nigeria with a total of $79.5 million in VC funding, was eventually sold off at an undisclosed price—widely rumoured as a loss. Jumia is the most-funded e-commerce company in Africa. But it also bears the heaviest cross. As of the third quarter of 2022, the company had accumulated losses of about $2 billion, owing to several factors. One of the loss triggers happened in 2019 when a report by a notorious short seller sent its stock price downhill. Jumia has changed its business model several times and even pivoted to other terrains like fintech, but its losses are still piling up.
