OyaNow, a seven-year-old Nigerian meals supply startup, initiatives it would break even by Q1 2026, in response to founder Abbas Dayekh. This can be a large win for the bootstraped startup, which has seen deep-pocketed opponents like Jumia Meals, Bolt Meals, and Uber Eats exit or shut down as a result of unsustainable unit economics. Its technique? Abandoning the mass market to wager on the wealthy.

Nigeria’s meals supply market, valued at over $1 million in 2024, faces intense strain for profitability. Though startups like Chowdeck, HeyFood, and FoodCourt declare to make a revenue on every supply, these earnings don’t cowl broader working bills; they don’t equal breaking even. OyaNow, one of many nation’s oldest meals supply platforms, is projecting that its new focus will trigger it to interrupt even by 2026. 

Dayekh says this objective is possible as a result of the enterprise is transferring away from worth wars for mass-market enchantment to focus as a substitute on much less price-sensitive customers. The previous strategy would have pushed the bootstrapped start-up into debt, as promotion-driven clients are sometimes disloyal, switching platforms earlier than companies can recoup acquisition prices. In distinction, high-earning clients are much less price-sensitive and stay loyal when provided handy, high-quality service.

“I needed to make a forceful option to tailor to the wealthy,” he instructed TechCabal. He clarified that whereas OyaNow’s cellular app stays typically accessible, its technique and advertising and marketing now goal a extra prosperous client base.

With expertise in offering monitoring options and insights about Nigeria’s e-commerce area, Versa Analysis’s group lead, Busola Akin-Olawore, argues that the best clients of meals supply platforms won’t be swayed by low costs and expressed wariness about companies that depend on worth wars to show a revenue. Meals supply startups that share and have adopted distinctive methods to sort out this.  Heyfood, a Y Combinator-backed startup primarily based in Ibadan, is taking the same strategy to OyaNow by allocating lower than 5% of its advertising and marketing funds to reductions and concentrating on younger city professionals with disposable revenue to outsource home duties, in response to its CEO and co-founder, Taiwo Akinropo.

OyaNow has expanded income streams from solely providing meals supply to offering numerous companies, together with logistics, laundry, automotive leases, and errands through its upcoming “Oya Concierge,” which might be launched through WhatsApp, providing vetted handymen and repair suppliers to customers. 

Dayekh acknowledged that this focus leads to a smaller market share than opponents like Glovo and Chowdeck. OyaNow has over 50,000 customers, a fraction of Chowdeck’s 500,000 customers, Glovo’s estimated 500,000 –700,000 customers, FoodCourt’s 100,000 customers, and Heyfood’s 50,000 customers in Nigeria.

Nevertheless, Dayekh claims OyaNow’s market share amongst prosperous customers surpasses its opponents’. He famous that together with his client base being larger spenders, OyaNow holds extra significance, with the 1% of the market, than its opponents – citing partnerships with high-end distributors like RSVP, Aldo’s, Cilantro, and a mean basket worth of ₦25,000, ($15.56) in comparison with opponents’ ₦5,000 ($3.11) – ₦8,000 ($4.98). For deliveries, the app expenses ₦1800 ($1.12) for the primary 3km and an extra ₦200 for each further km, in contrast with opponents’ ₦500 ($0.31) – ₦1,000 ($0.62) value for short-mile deliveries.

OyaNow has outlasted most of its in style rivals. Dayekh launched the corporate in 2017 after a poor expertise with Jumia Meals, the dominant meals supply platform on the time, alongside smaller gamers like Eden Life. Figuring out a spot in Nigeria’s supply market, he began OyaNow regardless of missing logistics or tech expertise. With out institutional funding, he relied on private financial savings and his community, limiting scale however permitting flexibility in a sector he was new to.

The 2020 lockdowns offered a big alternative; with cities shut down and roads empty, demand for supply apps surged. OyaNow achieved 202% annual development and $344,000 in income by 2020, Dayekh instructed TechCabal. This success attracted acquisition curiosity from a distinguished African funds expertise firm – identify saved off file – in 2021, however the deal collapsed as a result of market circumstances, together with Nigeria’s foreign money devaluation, rising inflation, and investor warning following the worldwide tech inventory downturn, which diminished urge for food for high-risk acquisitions.

Dayekh confronted vital burnout. He left Nigeria for a 12 months, stepping again from lively administration. Throughout this era, OyaNow skilled a “12 months of dullness,” with slowed development as shareholders, primarily buddies and private contacts, sought to exit.

Dayekh personally reinvested in OyaNow, shopping for again fairness from departing shareholders. He described this as a blessing, releasing him from strain to chase unsustainable development metrics. The logistics enterprise was capital-intensive, and competing with deep-pocketed start-ups would have pushed OyaNow into debt. Dayekh returned to restructure the corporate. 

Deciding that the unit economics of mass-market meals supply in Nigeria had been unsustainable, OyaNow deserted heavy subsidies and free supply. “By altering the best way I did it, I went from an especially loss-making operation to virtually breaking even,” Dayekh famous.

OyaNow maintains a lean operation with about 80 workers, together with in-house riders, however collaborates with third-party riders throughout peak seasons, scaling to 120 – 140 riders, Dayekh famous. The corporate prioritises natural channels over pricey conventional advertising and marketing, equivalent to billboards. In November 2024, OyaNow launched a podcast, OyaGistme, to cross-promote the model and talk about the nation’s enterprise ecosystem. Dayekh believes this fits its technique to draw high-value clients.

Finally, OyaNow is taking part in the lengthy sport: localising its operations and patiently ready for market dynamics to shift in its favour. As Dayekh places it, “The one purpose I’m betting on it’s as a result of I do know that finally dynamics will modify and a chance will come up.”