Berlin-based startup, Frontier Car Group (FCG) has secured $400 million investment from OLX Group. The capital infusion is expected to accelerate the growth of FCG into the top five car marketplaces worldwide and make it number one in some African markets. Its subsidiary, Cars45 is currently operating in a nascent market in Nigeria.
Nairametrics was informed that the $400 million would be disbursed into the expansion of FCG’s footprint among emerging markets. This isn’t connected to the operation of Cars45 – which also raised $5 million in 2017 and will seek more investment as the quest for growth increases, according to Cars45 founder and CEO, Etop Ikpe in an interview with Nairametrics.
This isn’t OLX’s first FCG investment: The $400 million fund isn’t the first capital FCG will be receiving from OLX Group. The startup had received $89 million from OLX Group in 2018. This helped in the acquisition of WeBuyAnyCar in the United States.
What this means: The $400 million capital makes OLX Group the largest shareholder in FCG as it is an exchange for new shares and to buy out existing shareholders in FCG.
It also boosts the value of FCG which reported impressive revenue placed at $700 million in 12 months. Since OLX took up stake in FCG, the used-cars marketplace venture has increased its presence from four to ten markets including Nigeria, United States, Argentina, Poland, India, Chile, Pakistan, Indonesia, Colombia and Mexico.
A partnership that works: While speaking about the impact of OLX Group on the operation of FCG, the co-founder and CEO of the group, Sujay Tyle said since OLX began to invest in the startup, the growth of FCG has been on an upward swing
“Together with OLX Group and Prosus, we are aiming to revolutionize the used car market in several emerging and developed economies by adding trust, transparency and a comprehensive suite of services to all participants in the ecosystem.”
He added that, “This is a testament to FCG’s team, the ripe market opportunity, and the results of early integration with OLX in our key markets.”
Also speaking about the deal, Martin Scheepbouwer, CEO of OLX Group, said, “Together with FCG, we are aiming to build the leading global used car marketplace, offering a premium and convenient service to millions of car buyers, sellers and dealers. We’re in a unique position to accelerate the expansion of this platform worldwide.
“Our experience in India is a great proof of concept, where within the space of a year, our joint venture has already increased the number of stores threefold, with car purchase volumes continuing to grow by 10% month-on-month.”
[READ ALSO: Analysis: MTN, buyer beware or aware?]
What you need to know: OLX Group is part of classified units of Prosus, the European company owned by South African firm, Naspers.
DEAL: Tomato Jos secures over N1.8billion series A funding
Tomato Jos secured Series A round funding through a consortium of investment firms
The local production of tomato paste in the country received a huge boost when Tomato Jos, an African agricultural production company, secured Series A round funding of EUR 3.9 million (N1.83 billion) through a consortium of investment firms, who are focused on providing support for small and growing businesses in Africa.
This series A funding is to help position Tomato Jos to further improve the lives and incomes of smallholder farmers and increase the sustainability and stability of food supply in Nigeria.
The funding round was led by Goodwell Investments, through its West Africa partner, Aliyheia Capital with participation from Acumen Capital Partners and VestedWorld.
Tomato Jos was founded by Mira Mehta in 2014 with the vision to create and retain local value add to the tomato value chain, reduce post-harvest losses, and improve the lives of smallholder farmers. Since its inception, Tomato Jos has focused on securing its supply chain through primary production.
The secured EUR 3.9 million Series A funding boosts the transition to its next stage of growth i.e. the processing and distribution of tomato products. The agricultural firm will work with thousands of smallholder farmers on over 2,600 hectares of land, putting more than $1 million of direct income into the local economy each year
According to the founder and CEO of Tomato Jos, Mira Mehta, ‘’Processing has always been the plan for Tomato Jos, but to get there, we spent a long five years working only on farming and primary production to make sure that we had a really solid foundation in place’’.
‘’Everyone at the company is extremely excited to take this big step forward into the world of food processing and value-add production’’.
Although Nigeria is the second-largest producer of tomatoes in Africa, farming inefficiencies create a demand-supply gap resulting in Nigeria also being one of the biggest importers of tomato paste in the world.
A partner at Alitheia, Mobola da-Silva, ‘’Tomato Jos has chosen the right market, business model, and management to succeed as a truly inclusive business within this management. As an agro-processing company that sources from local smallholder farmers and provides access to finance in the form of farming inputs to farmers, Tomato Jos is a good fit for uMunyhu’s inclusive strategy of investing in agribusiness’’.
Tomato Jos, through its initiatives and connecting local farmers to domestic consumers, has helped smallholder farmers’ average yield to grow by over 340% from 5 to 22 metric tons per hectare, while their average income increased by 455%.
CrossBoundary provided advisory support to this transaction through USAID’s INVEST program, funded by USAID Southern and Eastern Africa Regional Missions in support of the US Government’s Prosper Africa initiative.
The MD of Acumen Capital Partners said, ‘’Acumen Capital Partners is thrilled to join Tomato Jos’ Investors to help the company continue to develop a world-class vertically integrated tomato processing operation in Nigeria. Tomato Jos is positioned not only to locally produce tomato paste, which is mainly imported into Nigeria but to help Nigerian smallholder farmers increase their income by increasing their yield by 3-4x’’.
This is a huge boost to the country achieving self-sufficiency in tomato paste production as although Nigeria is one of the biggest producers of tomato in the continent, it is still one of the largest importers of tomato paste in the world.
It can also be recalled that in February 2020, Dangote Tomato Processing Company officially resumed the production of tomato paste after initial hiccups and suspension of operations. This was due to the inadequacy of raw materials.
Facebook’s shares up by 1.2% after it acquires GIPHY
The social media giant will invest in its technology and relationships with content, as users will still be able to upload GIFs.
The shares of Facebook increased by 1.2% when it closed at $209.19 after the Friday trading session at the New York Stock Exchange.
The social media giant had announced earlier on Friday via its news page that a leader in visual expression and creation, GIPHY, was joining the company as part of the Instagram team. Though Facebook has not disclosed the worth of the deal report confirmed that it was a $400 million deal.
What it means: The development would give Facebook’s Instagram users to express themselves in the right way, as the acquisition would further integrate the user’s GIF library into Instagram.
It stated, “GIPHY makes everyday conversations more entertaining, and so we plan to further integrate their GIF library into Instagram and our other apps so that people can find just the right way to express themselves.
“A lot of people in our community already know and love GIPHY. In fact, 50% of GIPHY’s traffic comes from the Facebook family of apps, half of that from Instagram alone. By bringing Instagram and GIPHY together, we can make it easier for people to find the perfect GIFs and stickers in Stories and Direct.
“Both our services are big supporters of the creator and artist community, and that will continue. Together, we can make it easier for anyone to create and share their work with the world.”
What Facebook plans
The social media giant disclosed that it would invest further in its technology and relationships with content and PI partners and that users will still be able to upload GIFs, “developers and API partners will continue to have the same access to GIPHY’s APIs; and GIPHY’s creative community will still be able to create great content.
“We’ve used GIPHY’s API for years, not just in Instagram, but in the Facebook app, Messenger and WhatsApp. GIPHY will continue to operate its library (including its global content collection).”
Founded by Jace Cooke and Alex Chung, GIPHY is an American online database and search engine that allows users to search for and share short looping videos with no sound, that resemble animated GIF files.
Deal: TLcom injects $1million pre-seed funding in Okra
TLcom Capital has invested $1 million pre-seed fundraise in Nigerian fintech platform, Okra to strengthen the latter’s push to build infrastructure for Africa’s next wave of fintech innovation
TLcom Capital has invested $1 million pre-seed fundraise in Nigerian fintech platform, Okra to strengthen the latter’s push to build infrastructure for Africa’s next wave of fintech innovation.
Okra is expected to use the new investment to scale its team and operations, as it caters to its growing client base.
Established in January 2020, the fintech firm’s “super-connector” creates a secure portal and process to exchange real-time financial information between customers, applications and banks. At the moment, African developers and organisations do not have access to real-time banking data, creating large hurdles during the onboarding and verification of customers.
The founding team is proud to boast that Okra is the first in Africa to bridge this gap, delivering a new layer of transparency between organisations and users in the lending, personal & corporate finance and real estate sectors.
With adequate support from the founding team, Fara Ashiru Jituboh and David Peterside, Okra’s technical expertise has already seen them connect with all of Nigeria’s commercial banks. Okra has the likes of Branch, AIICO Insurance PLC, Travelstart, Bamboo, Renmoney and Swipe (YC) amongst others on its clientele list.
Chief Executive Officer, Jituboh, said, “Our thesis is simple — financial innovation cannot exist without the proper infrastructure, which is data. Essentially, how far the African fintech sector can grow is intrinsically tied to the success of infrastructure like Okra and with our core market in Nigeria, we’re opening the door to another level of innovation in Africa’s largest market.
“There are approximately 125mn banks accounts in Nigeria alone — but over the course of the next two years, we will see that figure rise exponentially, which presents huge opportunities for growth. Our role within this is to deliver ease, speed and transparency to key players within the fintech space so they can get back to driving our continent forward.”
Partner at TLcom, Andreata Muforo, explained that his company is always on the lookout for startups with the potential for high value-generation and Okra’s technology provides the foundation for new fintech solutions in Africa for years to come.
“Equally, it was important for us to know that their leadership had the entrepreneur-led focus, which is crucial for execution. Fara’s background was vital here. She’s an expert in over 20 programming languages, worked with multiple Fortune 500 companies and is a great example of why we’re committed to investing in more female founders. She leads by example and we have seen her and David build a really exciting business, in a little under a year, we’re excited to help them grow further.”
Co-Founder and Chief Operating Officer, Okra, Peterside, said, “When we started Okra last year, our priority was to help African fintech and banks build the best in class technology and solve problems for their customers. This investment marks the next chapter of this mission.
“For too long, simple financial tasks like budgeting, internal reconciliations and credit assessments have been additional stressors for businesses and we’re filling a long-standing gap in the market. Our aim is to make these processes as seamless and pain-free for our clients so they can focus on their core services.”