Amazon of Africa makes public debut
African online marketplace Jumia made its public debut on the New York Stock Exchange on Friday, reaching a market valuation of nearly US$2 billion (A$2.8 billion), as shares jumped more than 70 per cent to a high of US$24.86.
Jumia’s shares opened at US$18.95, more than 30 per cent higher than its initial public offering price of US$14.50, which generated net proceeds of US$196 million from 13.5 million American Depository Shares, Reuters reported.
The company, which was founded by French entrepreneurs Sacha Poignonnec and Jeremy Hodara in 2012, is backed by Germany’s Rocket Internet, the parent company of Australian online marketplace The Iconic.
Dubbed the Amazon of Africa, Jumia connects 81,000 sellers with its 4 million active customers across 14 countries in Africa. While almost no retail sales currently occur online in Africa, the company said it is banking on an e-commerce boom.
Jumia reported 130.6 million euros in revenue in 2018, up 39 per cent on the previous year, according to Reuters, but high expenses due to advertising and technology spend led to a loss of 170.4 million euros.
In 2018, less than 1 per cent of retail sales sales were conducted online in African countries where Jumia operates, the company said, quoting data from Euromonitor.