August 5, 2020

Konga turns down $300m global funding

Tech Week: Konga set to excite customers with huge discount

•Invested over $120m in two years
•Loses N100m monthly
•Mulls listing on reputable Stock Exchanges

By Prince Osuagwu, Hi-Tech Editor

Despite making a loss of over N100m monthly, e-commerce outfit, Konga says it has just turned down a $300 million funding from a consortium of global investors, just to keep integrity and high level of professionalism in the business.

The company which prides itself as a technology company rather reposed trust on its current investors, saying they have got all it takes to lead its lofty quests to expand into other African countries and eventually taking the top position in the continent’s ecommerce landscape.

Already, the e-commerce giant has invested well over $120m in its Nigerian operations alone since the Zinox Group acquired it in December 2018.

That is also as the company hopes to list its shares in reputable stock exchanges, including the Nigerian Stock exchange, New York Stock Exchange and the London Stock Exchange, which the company revealed have all approached it for listing.

In a television interview recently, Co-Chief Executive Officer, Konga Group, Prince Nnamdi Ekeh revealed that at the start of business, the company was incurring a loss of over N400 million monthly, but with diligence and strategic approach to business the company has managed to reduce the loss to just about N100 million while it hopes to flatten the curve very soon.

He said: “Though we started with a monthly loss of N400m, but with new systems, structure and energy put in place, we have gradually been reducing losses and now about N100m loss per month. E-Commerce is an expensive project but we are best positioned to deliver as a very innovative technology company”.

The young business leader, who described Konga as a technology company revealed that Konga employs directly and indirectly over 150,000 Nigerians. Most of them are merchants, logistics and other service providers.

He added: “We partner to create a trusted and sustainable digitally-driven ecosystem and working hard to scale this to about 250,000 before the end of 2020. We see ourselves as more than just an e-Commerce company. Konga is a technology company and as a technology company, we are positioned to leverage that status in deploying new solutions and innovations.

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“Although we have received several offers from interested investors, we are content with the group that is currently funding Konga. The group is highly ethical and want us to maintain the highest level of integrity. Our investors have assured us of enough capital to survive the next five years at least. This was why we did not accommodate a valuation of $300m from a consortium of global investors last year.

“However, we are also keen to expand into other African markets after taking charge of the Nigerian market. The e-Commerce market in Africa is still a largely untapped one. Therefore, any company that makes the right in-roads will reap huge benefits from it,” he said.

“We have also received enquiries from the New York Stock Exchange, the London Stock Exchange and the Nigerian Stock Exchange to list on these markets. It’s something that will happen as part of our African expansion plan when Konga becomes a multi-billion-dollar business.”

Continuing, he stated: “Our strategies and tact are 21st century influenced, but also taking cognizance of deficiencies in our country and that was why we spent the first two years rebuilding technologies, setting up secure but robust warehousing facilities and delivery logistics nationwide. With these under our control and owned by us, we are driving towards profitability. It is important to note that at Konga, we do not believe in just hype.

“In addition to our status as a technology company, Konga is also Nigeria’s first-ever marketplace and composite e-commerce group. The company is on the verge of rolling out a suite of cutting-edge solutions and services that will excite the market very soon.

“But that is not all. A lot is happening behind the scenes at Konga. We recently announced the re-launch of the Konga Affiliate programme. Also, we developed a solution for corporate procurement which has helped procurement managers in major establishments.

Konga boasts the largest collection of merchants and because of this, pricing is very aggressive, thereby helping procurement managers get the best deals on Konga while also promoting transparency. We are committed to our vision and clearly understand that it is a long term and highly ethical race,” he concluded.