Nigerian startup Gloo.ng is shrinking consumers’ online retailing and turning to B2B e-procurement with Gloopro as its new name.
The Lagos-based company has called on him to forgo e-commerce grocery services, switching to a product that supplies large and medium-sized businesses with everything from desks to toilet paper.
According to Gloopro CEO DO Olusanya, Gloopro’s new platform will generate revenue on a monthly fee structure and a percentage on delivered goods.
Gloopro, which raised about $ 1 million in seed capital as Gloo.ng, is also in the process of ramping up its Series A round. The startup seeks to expand outside of Nigeria on that increase, “before the end of next year. “Olusanya told TechCrunch.
Gloopro’s move away from B2C comes as several notable consumer digital sales companies have failed to launch in Nigeria, the most populous nation in Africa with the largest number of online shoppers on the continent, according to a recent UNCTAD report.
The country is home to the continent’s first e-commerce startup unicorn, Jumia, and serves as an unofficial indicator of e-commerce startup activity in Africa.
Gloo.ng’s switch to B2B e-commerce was due to Nigeria’s economic slump in 2016 and a request from a client, according to Olusanya.
“When the recession hit it negatively affected all e-commerce consumers. We saw that it would take longer to achieve sustainability and profitability,” he told TechCrunch.
Then an existing customer, Unilever, requested an e-shopping solution in 2017. “We saw that the economics of that business unit was much better than consumer e-commerce,” Olusanya said.
Gloopro sees itself as a “secure cloud-based commerce and e-commerce platform…[for]… Corporate purchases “, by description of the company.
“The old Gloo.ng brand, it will rest and shut down completely. The corporate name will be PayMente Limited with the brand name Gloopro, ”said Olusanya.
From the Gloopro interface, customers can order, pay and coordinate the delivery of office supplies at multiple locations. The product also produces procurement analysis and allows companies to designate users and permissions.
Olusanya promotes the benefits of the product by improving transparency and efficiency in the purchasing process.
“It makes hiring transparent and secure. “Many companies in Nigeria still use paper invoices and there are some shenanigans,” he said.
Gloopro began offering the service in beta and building a customer base before ending its Gloo.ng grocery service.
In addition to Unilever, Gloopro’s clients include Uber Nigeria, Cars45, and LaFarge Industrial Equipment Company. Cars45 CEO Etop Ikpe and a Uber Nigeria spokesperson confirmed their client status to TechCrunch.
Gloopro CEO DO Olusanya believes the company can compete with other global e-purchasing providers, such as SAP Ariba and GT-Nexus, by “leveraging our expertise in sourcing and last mile in Nigeria” and on experience around local requirements in Africa.
Gloopro expects to reach $ 4 million in revenue by the end of the year and the company could reach $ 100 million in the course of its international expansion in countries such as South Africa, Kenya, Morocco, Egypt and the Ivory Coast, according to Olusanya. A seed investor informed of Gloo.ng’s estimates confirmed the company’s revenue expectations with TechCrunch.
Gloo.ng’s turn to Gloopro and e-shopping comes during an up and down period for B2C online retail in Nigeria, home to Africa’s largest economy.
Last year, e-commerce startup Konga.com, backed by roughly $ 100 million in VC, was sold in a distressed acquisition, at a loss for investors including Naspers. At the end of 2018, the Nigerian online sales platform DealDey closed down.
Possibly multiple outlets this year reported that Jumia, Africa’s largest e-commerce site and the first unicorn based in Nigeria, is seeking an IPO. But that information is unconfirmed based on a Feb. 8 Bloomberg story with no named sources. Jumia has declined to comment.