Wasoko and MaxAB, two of Africa’s top business-to-business (B2B) e-commerce platforms, have signed preliminary merger terms to combine forces as a single entity aimed at driving the digitization of Africa’s informal retail sector.
Formerly known as Sokowatch, Wasoko raised $125 million in a Series B funding round in March 2022. The company enables small African retailers to restock inventory at any time through its mobile app, with same-day delivery available across Kenya, Tanzania, Rwanda, Uganda, Zambia, and the Democratic Republic of Congo (DRC).
Founded in 2018, MaxAB allows underserved local stores and mom-and-pop shops in Egypt and Morocco to grow revenues and improve livelihoods. In October 2022, MaxAB closed a $40 million pre-Series B funding round.
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Despite challenging fundraising conditions in Africa, Wasoko and MaxAB have announced a “merger-of-equals” to accelerate the growth of both companies and establish the continent’s most successful digital retail business. Details on the new entity’s name and ownership structure have not yet been finalized.
According to MaxAB CEO Belal El-Megharbel, “This merger is the result of building great teams, years of hard work, and a commitment to innovative solutions for retailers. As a combined force, we can truly tap into the potential of Africa’s informal retail space across e-commerce, fintech and logistics. With natural synergies between us, we will empower customers and partners continent-wide as we start an exciting new chapter.”
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Wasoko CEO Daniel Yu echoed a similar sentiment, stating “When I launched Wasoko in Kenya in 2016, the goal was to build a pan-African company, and this merger represents significant progress towards that vision. By joining forces with MaxAB, we reinforce our pledge to connect consumers and businesses with essential, affordable products across Africa. We look forward to realizing our shared outlook even further together.”
The merger comes as B2B e-commerce firms in Africa face cash flow challenges, forcing many to downsize. For example, Copia Global laid off 700 employees and exited Uganda, while Twiga and MarketForce dismissed hundreds of staff members.
Earlier this year, Alerzo also cut over 15% of its workforce. By combining strengths, Wasoko and MaxAB hope to withstand market volatility through expanded offerings in digital retail, financial services and delivery logistics.
