Jumia in Landmark Stock Market Listing
Shares in Africa’s largest e-commerce retailer are set to start trading in New York today in a move that could pave the way for other tech start-ups from the continent.
Jumia is listing about 18% of its shares, giving it “unicorn” status – a technology start-up worth $1bn-plus.
It is the first tech start-up from Africa to float in New York.
The so-called “Africa’s Amazon” has 4 million customers on a continent where just 1% of retail sales are via online.
Jumia was founded in Lagos, Nigeria, by two French entrepreneurs in 2012 and now offers services to most of the African population, in countries such as South Africa, Tanzania, Egypt and Ivory Coast.
Its largest shareholder is MTN, Africa’s biggest telecoms company.
Friday’s flotation on the New York Stock Exchange is expected to raise more than $200m (£153m) for shareholders and for future investment. The shares have been priced at between $13-$16 each.
The BBC’s Africa Editor, Larry Madowo, said that Jumia was not yet profitable and had accumulated losses of nearly $1bn since it was founded.
Although there are technical and infrastructure hurdles to growing Africa’s online retail market, he said a big selling point was that Jumia accepted mobile money payments across a continent where few people have credit or debit cards.
However, he said Jumia faced tougher competition. “Its initial public offering coincides with the launch of a competing app from global logistics provider DHL allowing consumers in 11 African countries to buy directly from global retailers.
“The DHL Africa eShop brings together more than 200 American and British retailers and will deliver directly to homes, something Jumia has struggled with.”
Erik Hersman, chief executive of Nairobi-based internet and software firm BRCK, said Jumia’s listing sent an important signal to other African start-ups that a major stock market listing was possible.
“It’s an important event in the evolution of the African tech scene,” he told the BBC last month.