JP Morgan Makes Cash Investment in Nigerian Online Retailer Jumia
Africa’s fastest growing online retailer Jumia has, alongside South African online fashion retailer Zando, announced that U.S.-based J. P. Morgan Asset Management has injected funds into their operations.
J. P. Morgan Asset Management, a leading asset manager for institutions, is investing into their operations via a German holding company in a cash-for-equity investment.
Jumia, like Zando, was launched earlier this year with the support of Rocket Internet GmbH, the European Incubator of internet start-ups.
Zando has grown significantly since it has been launched and has become one of the top five online stores in South Africa.
Jumia’s operation in Nigeria has been at the front of e-commerce activities in Nigeria. It also operates in Egypt and Morroco.
Earlier, Kasuwa and Sabunta was rolled into one operation and became Jumia, in an effort by Rocket Internet GmbH to merge their African ecommerce operations.
Jumia co-founders and joint-CEO’s Tunde Kehinde and Raphael Afaedor are optimistic that Nigeria is going to become an e-commerce haven. According to the two, the investment is a real turning point for Jumia, and e-commerce in Nigeria.
“With this investment, we will strengthen our current footprint, offering our customers more brands, more categories and more services as well as improving operations; we are among the pioneers of e-commerce in Nigeria and this investment confirms that Nigeria will become a very large market in the very near future,” they said.
J.P. Morgan Asset Management Portfolio Manager Robert Cousin, who worked on the deal from New York, confirmed the transaction saying: “We are excited to partner with Jumia and Zando as the companies continue to expand their e-commerce presence in Africa.”
The e-commerce frenzy in Nigeria has become intense with the likes of Kamdora, Konga and Taafoo coming onto the online retailing scene.
Start-ups in Nigeria have been gathering interests from Investors within and outside the country. In July this year, the Nigeria-based Iroko Partners raised US$2 million from Sweden’s Kinnevik, an early investor in Groupon Inc. Iroko has previously raised $8 million from U.S.-based hedge fund Tiger Global in April as investors in emerging markets seek to tap into one of the fastest growing movie businesses in the world.
Paga, a Nigeria-based mobile payment company, also raised its first round of funding in May 2011 from Goodwell West Africa, a microfinance investment vehicle co-managed by investment manager Goodwell Investment and Alltheia Capital in Nigeria. It received another fund(undisclosed amount) into the business from Adlevo Capital, Omdiyar network, Acumen Fund and Capricorn Investment Group.