Landmark Seed Round Boosts North African SMEs
In what is one of the largest ever seed rounds raised by a start-up in the MENA region, Egyptian-based e-commerce platform, MaxAB, yesterday disclosed the completion of a $6.2 million funding.
Founded in November 2018 by Egyptian and Libyan entrepreneurs Belal El-Megharbel and Mohamed Ben Halim, the B2B start-up connects informal food and grocery retailers with suppliers in the country’s most under-served geographies via an easy-to-use app.
Egypt’s $45 billion FMCG food retail market is heavily fragmented and multi-layered, which presents multiple trade obstacles for the country’s 400,000+ traditional retailers. This is what MaxAB is trying to address, using its Android app to close the gap between traditional retailers and brands & wholesalers.
“Nobody has addressed the underserved retailers before; retailers are faced with a limited assortment of products, the hassle of dealing with multiple wholesalers and restricted access to credit facilities,” said El-Megharbel, who is also MaxAB’s CEO.
According to him, the FMCGs at the other end of the supply chain also have limited visibility on market trends, demand patterns and retailers’ business needs which leads to loss of potential revenue opportunities.
The goal is to re-engineer the informal grocery and food market in Egypt, using empowering technologies and innovative supply chains designed to fit the needs of retailers in the areas they serve. MaxAB’s technology-enabled supply chain is helping put the correct amount of food at the right place at the right time.
Brands using MaxAB’s simple and automated service have access to real-time demand monitoring and business intelligence tools, which improve end-to-end supply chain control, and better forecasting.
For retailers in remote and under-served areas, they get access to a wide variety of products, the convenience of ordering stock online in addition to second-day deliveries as well as the added benefit of access to credit facilities.
Since its founding less than a year ago, the 270-strong MaxAB team has built a stock list of over 600 products [including groceries, beverages, dairy, and confectionery & non-food products]. The startup has recorded 50 percent month-on-month growth, with 9,000 activated retailers on the platform already.
“By leveraging technology, MaxAB is redefining the grocery supply chain in Egypt,” Managing Partner at Beco Capital, Yousef Hammad said. “The metrics they have recorded in such a short period are impressive, and we expect to continue to see double-digit growth as they scale.”
With the fresh cash injection, the company plans to expand its reach across Egypt and North Africa, enhance its technology and scale the business. Specifically, MaxAB has a target of reaching 50 percent of Egypt’s population within the next two years before expanding across different markets, it said in a press release.
El-Megharbel added, “This investment round will allow us to accelerate our growth plans and develop new products and services throughout North Africa using the first of its kind B2B e-commerce platform.”
The seed round was co-led by Beco Capital, 4DX Ventures, and Endure Capital, with participation from 500 Startups, Outlierz Ventures, and other local investors.