Afrigather SafeBoda, the Ugandan bike-hailing startup, is leaving Nigeria to give attention to “bringing the corporate to profitability by deepening its core transportation providing” in Uganda, its largest market.
That is the second time SafeBoda is exiting a market since its founding in 2017. In 2020 SafeBoda exited Kenya after extending its companies to Nairobi lower than two years prior. The corporate mentioned it exited Kenya as a result of detrimental results of COVID-19 on its enterprise.
SafeBoda had a formidable run in Ibadan. In just a bit over one 12 months since launch, the startup crossed the a million rides milestone, rising at a formidable 150% MoM. In one other 11 months, it tripled its traction to 3 million accomplished rides, cementing its dominant place within the area.
However it’s leaving Nigeria as a result of the okada (an area time period for bike taxis) business “in its present state will not be economically viable and sadly requires important funding at this difficult time within the world financial panorama,” the press assertion learn. An organization spokesperson informed TechCabal through textual content that the Nigerian marketplace for its operations was “unprofitable”.
Solely two months in the past, SafeBoda introduced car-hailing pilots in Kampala. On the time, Olaoluwa Arokoyu, Nigeria’s nation supervisor at Safeboda, informed TechCabal that, “The product is already going via a collection of iterations in Uganda, and when it’s finished, we’d run a fast one in Nigeria and launch.”
Discovering revenue
To help the corporate’s path to profitability, SafeBoda has secured further funding (whose cheque dimension or phrases it didn’t disclose) from Yamaha Motor Firm and current buyers, together with Unbound, Allianz X, and JAM Fund. In keeping with the corporate, this new financing will assist it deepen its core transportation providing “whereas persevering with to construct its funds and monetary companies in Uganda”.
“In Nigeria, the core unit economics of the okada enterprise have been very difficult, they have been optimistic, however the margins have been too skinny,” SafeBoda CEO Alastair Sussock informed TechCabal through textual content. In Uganda, nonetheless, the ride-hailing agency is nearer to profitability. “Uganda generates important money circulation and is shifting shortly to full profitability. The unit worth of our companies are considerably larger than Nigeria and our model has deep roots… Uganda is a big market with over 1.5 million [boda] rides taking place on daily basis in higher Kampala alone.” Sussock added.
SafeCar, the corporate’s new car-hailing product continues to be in play. In a press release shared with TechCabal, SafeBoda mentioned its car-hailing enterprise has grown 40% weekly since its launch in early September. “Our SafeCar service is rising very quick and our drivers love the brand new automobile group we’re constructing,” mentioned Sussock.
