April 1, 2020
Why Jumia Is Beating Amazon And Alibaba In Africa

Why Jumia Is Beating Amazon And Alibaba In Africa

It’s been dubbed the
“Amazon of Africa”. It’s Africa’s largest e-commerce operator,
surpassing Amazon and China’s Alibaba, and it’s the first African tech
startup to go public on the New York Stock Exchange. Investors had high hopes for Jumia when
it went public on April 12th, 2019. Stocks skyrocketed at first, but
then quickly tumbled on the heels of criticism. This is a fraud being
played on the U.S. marketplace. People started questioning Jumia’s Africans,
too, due to the company’s largely European leadership
and shareholders. We are completely African company. Now, Jumia is adjusting to its
international status and figuring out what that status means for
the African continent. There is an Africa ecosystem that has
developed off the back of the creation of this thing. Jumia was founded in 2012 by Sacha
Poignonnec and Jeremy Hodara, who were both former employees of the
American worldwide management consulting firm McKinsey and Company. Jumia offers customers the ability to
buy products online, like phones and shoes, as well as groceries, flights,
food delivery, and offers bill paying and cellular data recharging. The company sought to build an
online shopping experience, among other digital products that could work
well with Africa’s sometimes ineffective infrastructure. If I said, “you know what, 42nd Street
on 3rd Avenue, I’ll be on the corner waiting for,” you know
exactly where we’ll meet. You can’t do that in Africa. The streets aren’t as signposted. You don’t know the geography, especially
when you think of outside the major cities. In other cases, Jamia cites a
lack of online shopping experience from users. When we ask the people who have
never used online shopping yet, the reason why, the number one reason which comes up
is, “I don’t know how to shop online.” That’s why it was so important to
make sure Jamila addressed its specific user base, and wasn’t just a
cut-and-paste copy of Amazon or Alibaba. Alibaba serviced 4.2 million African customers through its
AliExpress service since it entered the continent. Jumia serviced 4.3 million users and 81,000 active sellers
in the 14 countries it services since it started. Let’s take something that works in the
West, throw it into Africa and see if it works. If it works, we’ll throw money at it. If it doesn’t work, we’ll
kill it very quickly. That strategy for me was fundamentally
flawed anyway, because I believe, you know, anything emanating from an
ecosystem should be solving a problem that is consistent with. Amazon is technically available in 11
countries on the African continent. But neither Amazon nor Alibaba have
the benefit of starting and completely focusing on African countries. Jumia, for example, offers unique features
like pay on delivery, and that piqued the interest of U.S. investors. Everybody’s been looking for
an African unicorn. We’ve all been looking, you know, I’ve
been in this, in the angel business for about a decade now, and all of
us are looking for that, you know, something that validates
the African experience. When Jumia went public on the New York
Stock Exchange, it had a lot of promise. Its stock prices rose 75.6 percent on its first day and
held a market cap of $3.9 billion. And even though it had about
$1 billion in losses at the time, the prospective shareholders
were forgiving. The U.S. was excited to have the opportunity to
buy into the first African tech startup on the New
York Stock Exchange. All of a sudden, here is somebody
coming and say, “guess what, guys, we’ve cracked Africa. You know, we’re
making money gangbusters. This is it.” You know, everybody got excited because
we all want Africa to win. Everybody wants Africa at the table. But the attention Juma was
getting in the U.S. exposed some of its problems. We have no doubt at Citron that
this report that we’ve issued and the supporting documentation will soon be used as
evidence by the FTC in a case against Jumia. In May of 2019, Jumia came under
fire from Citron Research, a stock commentary website run by short seller
Andrew left for what Citron claimed was securities fraud and discrepancies
in its reported key financial metrics. What we learned about Julia is best summed
up in one email that was sent to us from a former executive. And what does he state to us? That Jumia is clearly lying
about every reported number. The report released by Citron brought Jumia’s
stock down over 40 percent in two days, and Citron isn’t the only
entity to raise its eyebrows at Jumia. To be honest with you, there are quite
a number, and I’ve met a few myself, of disgruntled Jumia employees
floating around there. You know, you look at some of
the reporting, there’s some credibility, but I think it’s overhyped. That’s just a personal view. But there’s, there is
no smoke without fire. Jumia is culpable on
some of those things. That is my personal opinion. Jumia Nigeria’s CEO, Juliet Anammah responded
on CNBC Africa to the accusations. This is taken, selected, biased and in
some cases unverified facts with a clear, you know, possibly the intent
of damaging the brand and profiting from it. Citigroup, one of Jumia’s is IPO
leaders released a report debunking most of Citron’s allegations, but noting that,
“Jumia could do more to provide disclosure on some aspects of its
operations as a matter of transparency and best practice.” But it wasn’t just this
scathing report that hurt Jumia. Soon after it went public. The hashtag Jamia is
not African gained popularity. Commenting on the company’s
largely European involvement. Jumia is a German company. Okay? So it’s paying its taxes in
Germany, where the founders and most of the shareholding is based
except for MTN. Its CEOs, which is irrelevant to
the argument, are actually of French origin. Its development team, it’s after
all a tech company, its development team is actually in
Portugal, which is in Europe. Its headquarters is in Dubai. But Jumia CEO Sacha Poignonnec
says Jumia is a. completely African company. We operate exclusively in Africa. We have more than
5,000 employees in Africa. And as you point out… But those are the
warehouses, not the engineers. The reality is in Africa, there’s
not enough development and developers, for example, and we know that and
we need to collectively, the startups and the VCs and everyone, address
that because everything should be in Africa. This is what we want, and
it shouldn’t be like this one day. We need to work on that. It’s not going to happen overnight, but
this is something we have to do, for sure. But Jumia’s African-ness this is not
as critical to some. Despite the company’s offshore management, Jumia has
kickstarted a wave of new startups created by
former Jumia employees. It has grown Africans to the point
where we are now creating companies because of that experience. And that can only be good. We now have our Jumia mafia, just
like you’ve got the PayPal mafia. And that’s what I look at
is what has it created. Jumia has certainly made a big splash
on the New York Stock Exchange, but the bigger impact was
on the African continent. I think the focus and the emphasis has
been too much on Jumia as IPO and all of that. There is an Africa ecosystem that has
developed off the back of the creation of this thing.

100 thoughts on “Why Jumia Is Beating Amazon And Alibaba In Africa

  1. At 3 seconds in there’s already a guy wearing a weed shirt 😍🤣 this videos for me!

  2. Wow!!! Well they reAlly had me believing by the thumbnail an all African(by person of color) had a startup on the continent of Africa raised capital and was booming with potential,growth, and more.Turns out a 2 stout white gentlemen are at.the helm of.this "African start up'".SMH….nothing to see.here folks just good ole fashion get the money and get out of dodge. Hahahaha

  3. A truly authentic African competitor to Amazon and Alibaba can't be anything other than nubian and especially not a service offered to blacks that doesn't economically benefit them. It's a fraudulent attempt by outside entities. Mckinsey as the root where Mckinsey is viewed by people of color as yet another western entity that will benefit via inequitable returns over blacks.

  4. USA – lets get the best Europeans to design our bridges and buildings and the Africans to build them
    France – let's get the children of Africans to help us win the World Cup
    France – let's get a grandchild of a German to build the Eiffel Tower, a Corsican to led our military, a Haitian to fight the British
    Egypt – lets get the Nubians to build the pyramids
    English – lets get the Indians to build the East Africans Railroads
    Africans – We made it to the World Cup quarterfinals but our coach was European, get rid of him
    Africans – We have a company that has Europeans employees so let's boycott and damage their brand while we sit around and do nothing
    I have seen this racist, crazy attitude with Africans and African Americans. You are SUPPOSED to get other people to do the work for you. That is how Europeans gain wealth. They learn from people and branch out on their own.

  5. Africa, while we sleep…look at what is being taken from underneath us. We lack integrity when we become leaders and see the white man as a hero…this continent will be taken from underneath us again because we are sleeping. Our people, get into power, they just steal and abuse it's people and then the whites come in slowly. Also the Chinese….mmmhh let's keep sleeping. You will try to find another way to be a citizen on a rock. I mean this is sad.

  6. African company my ass the only thing about this that's African is its workers but the profits are European

  7. You see how those africans are behind this Caucasian haha it's a European company in Africa so yall Africans working for them

  8. Not enough developers in Africa bullshit…I'm not buying on jumia again . Well I guess they do everything in Europe so they don't know much about it's own consumers

  9. Americans are selfish, they don't wanna see anyone rising. They are doing the same to Chinese with Huawei 5G. If you wanna be superior, do the best!

  10. A lot of people are saying its not African owned Well start DOING everyone less talking put it in Action play your part and try to improve Africa.
    Blacks/Whites/Asians/Indians etc.. We are going to need help from one another Just learn from it learn from each other and improve. Changes can be made overtime.

  11. BS. I'm not buying from them anymore. I thought the company runs in Lagos Nigeria. What does he mean there are not many developers in Africa. That's untrue. Lagos alone has tens of thousand of them.

  12. Jumia is not African company it is European company.
    The owner is from Germany that's why the pay Taxes in Germany!

  13. African exploitation at its best yet again! 🤦‍♂️ majority of the proceeds does not benefit AFRICA! When will all this nonsense end!?

  14. Why? Because nationalism, duh..
    It's easy to answer

    If your country can make it, then why not using it than importing other country's product?

    Not only in this sector. But also military, medicine, electronic devices, car, etc.

    Edit: and from what I saw after watching the video and from the comments, this thing is not really 100% from Africa. But hey. At least it is born in Africa. Soo some Africans will think it is African-made product. They're scammed XD

  15. If jumia doesn’t stay mainly african such as leaderships and workers, africans must do something about it. Go out it Africans! Don’t let whities take over the tech too in your continent (:

  16. Learn to appreciate what is on the table. If you have less to cook, work more hard and produce best online shopping sites created by African developer.

  17. 0.58-1.01 is not true. The founders were two Nigerian man in 2012: Tunde Kehinde and
    Raphael Kofi Afaedor. They sold it off in 2014


  18. ahhhhhhh, another story with the same old story, you get happy and hopeful then find out its some more white boys behind it, only using their faces for it while they hold the big positions.

  19. Falsehood: Jumia was founded by a Nigerian, Tunde Kejinde and Ghananian, Raphael Afaedor. Sacha and Jeremy came in after

  20. As a Kurd I see similar behavour with african people. The people don’t unite to get strong as a country and getting a better life. When they see, someone is doing good business, because of their ego they want him to get down. With negative people and their ego, you can‘t go forward. Very sad

  21. I know and understand that it hurts Africans to hear this, but, its true we dont have world standard developers. We dont have the money to support a large scale business like jumia. Also governments across the continent will always screw over locals for international investors because of money. Those are facts and i think we need to debate on how to get passed this type of hurdles.

  22. I do lots of finance videos on Investing, Ecommerce, & Real Estate.
    Come stop by my channel, Appreciate it. Cheers.

  23. Jumia understands their no physical addresses in Africa….and i like that… they didn't try to change us the worked with us. They know we dont trust easily so we are pay on delivery.

  24. Soooo… Jumia is African but is run by white guys. Sure I buy it. But here's the truth, Jumia is like an African skin for Amazon/Alibaba. You buy from Jumia, sellers buy from Alibaba or AliExpress or Amazon. lol. They make Mark Angel Comedy video an Inc and put it on the stock market, then I am still more likely to buy it rather than Jumia.

    It's "African" because its labor workers which are paid by the pennies are Africans.

  25. puts index finger to temple Cant compete with a company if you don't let them operate. Can't really call a monopoly due to poor infrastructure a competitive market. Trust me i live in Nigeria. They didn't BEAT Amazon. Amazon just doesn't operate here. Beat. Lol please. Everyone goes to amazon, then sees "doesn't ship to your location". That's how they beat amazon. Seriously would rather buy things on amazon, send them to my family or friends houses outside Nigeria, and pay to have them send it to me from there or just wake for them to come by than use freaking jumia. If i use jumia it's because i have no choice. But i am an optimist. Maybe amazon is just allowing jumia to gorge on its monopoly… To fatten them up, then swoop in and buy them out. Jumia sucks. Just a giant scam that people have no choice but to use or drive for hours and hours in hot traffic for the chance to MAYBE see it at some dirty market swarming with people that still needs to be haggled over.

  26. Wtf!! I am a Kenyan and Jumia is not even a talk in Kenya we find it as some cheap backstreets vendors. Naah ain't feelin it. Actually we have lots of successful online developers organisations in Kenya and indigenous. JUMIA whaaat??

  27. I am from Kenyan, and i i cant compare Jumia to Amazon(i import from amazon US) as a buyer from both sides. I only buy groceries from Jumia. Most of Jumia products are chinese, low quality and with unknown brands. The quality electronic items sold at Jumia cost almost twice that of amazon. Jumia's efficiency also can't compare to that of Amazon.

  28. Hey Africans, the white man is your enemy. Get this into your thick african skulls and fight back and your lives will be better

  29. I was born in Africa and I will die in Africa but jumia is not the biggest eShop in Africa since they don't sell there products across Africa, I live in South Africa and I can't buy anything from jumia and South Africa is the most electronically advance country in Africa.

  30. 💯🇺🇸👩🏿‍💻. Kick those Devils out of the African country White Man 👨 is the 👺 Compton California

  31. Its not an african, not german nor euripean but china. And theres alot of businesses hiding in other country but owned by china. And this is one of many scattered.

  32. Anyone who has tried Jumia, Amazon and AliExpress would undoubtedly find Jumia excruciatingly extorting.

    I haven't tried Amazon, but when I saw the prices of goods I bought from Jumia on AliExpress, I felt not so good.

  33. "There are not enough developers in Africa"???? They are mining Africa, (as usual) and perpetuating the lie that Africa can't help itself?! Crazy.Just say you saw an opportunity, and leave it there.

  34. I will say jumia is the best in Ghana when u talk of buying outside the country .but pls and pls we need more item such us RC foam board , magical book, motorcycle engine and so on pls.Thank uuu JUMIA..

  35. Now the world see what business is like dem trying to bring it down because it's in Africa i did own some of this stock and I have to sell it because of the news…..

  36. Citron needs to be sued and i hope somebody do it very soon is a lot of company dem do it to…… maybe other companies are paying them to do it

  37. Only white people can do these kinds of thing and get away with it how can someone go around and destroy people company…. how citron do and get away with it….

  38. Jumia use "the first african startup company" only as a branding, to market itself. So thats why its stock price can go up and it gets the fund it needs.

  39. These people do realize that there are actually beautiful parts of Africa they always show the local streets yet we wonder why they always assume we're all poor

  40. I believe in Jumia. But African retail business will have alot of trouble. Some one is got to look at this new change with a sharp eye. It could open another door to poverty.

  41. Ok so this Citron company is owned by a famous short seller who specializes in making daming reports on various companies? Hmm.. ;p

  42. The company was started in Africa. There are white people who were born in Africa.
    So many racists in the comments.

  43. regarding the EU dominance in the investments of the company: try finding investors in Africa.
    maybe you didn't know, but especially Sub-Saharan Africa isn't the richest.
    also. seeing Amazon partners getting butthurt by an African company is satisfying af!

  44. these neanderthals aren't clever. they issued a fallacious report, then waited to the stock crashed, then bought it up .you see the jump in the graph lol. THAT should be the fraud. that said, i don't care for jumia if they aren't completely black owned and operated. expel them from the continent.

  45. 7:00 Nigeria has a lot of developers that are skilled enough to be outsourced to big tech companies like GitHub[MicroSoft].

  46. Interesting if Jumia is a German tax domicile business they will be well aware the EU is coming after them very shortly for a whole load of extra taxation. This was announced just after the EU returned from it's summer holidays this year…

  47. Its creating jobs and it will create other companies as it grows.. why is everyone hung up on who's ethnicity is what? money is money… it doesn't care what heritage you have

  48. Yes.. It should take over. I support it..
    Jumia won't take your money and close your account but amazon will close your account after taking your money and they will bring false allegations against you and no matter how you call their customer service, they won't do anything about it.. Jeff Bezos and his amazon company had a new way of stealing from the people

  49. Companies aren't 'European' or 'African'; they're global … it's time to move beyond obsolete 20th-Century abstractions.

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