- MaxAB, a Cairo-based firm that offers a network of traditional Egyptian food and grocery stores, has raised $40 million in Series A funding
- MaxAB’s platform coordinates procurement and groceries delivery to shops in Egypt and was founded in November 2018 by Belal El-Megharbel and Mohamed Ben Halim
- The company’s workforce has increased by more than 5 times to 1,600 workers, and it is eager to expand further
- It has used its position as a market leader to consolidate its position and scale sustainably in the face of competition
Food and grocery delivery firms have been raising mega-rounds around the world recently, particularly in Europe, since the pandemic has resulted in more individuals ordering online than before. This expansion has resulted in increased volume on e-commerce platforms around the world.
While there has been little activity in Africa in terms of obtaining funds, startups in the Middle East and North Africa (MENA) continue to attract attention, particularly in B2B e-commerce. The most recent of these is coming out of Egypt today. MaxAB, a Cairo-based firm that offers a network of traditional Egyptian food and grocery stores, has raised $40 million in Series A funding.
The company plans to grow its physical footprint across the Middle East and North Africa, claiming to have started in a new city every month this year. It also intends to hire additional people and expand its recently created business verticals, such as new supply chains and embedded finance solutions.
MaxAB’s platform coordinates procurement and groceries delivery to shops in Egypt and was founded in November 2018 by Belal El-Megharbel and Mohamed Ben Halim. Store owners can utilize the site to buy products, request delivery or logistics, and get in touch with a customer service team.
Belal El-Megharbel and Mohamed Ben Halim’s Verdicts
“It’s not only the technological platform; we have our own warehouses and fleet,” says the company. And the concept was straightforward.” El-Megharbel, the CEO, stated. According to him, Egypt’s small merchants, who account for a significant portion of the country’s GDP, have difficulty obtaining inventory.
Manufacturers, on the other hand, must suffer greatly and spend a great deal of expense to serve a market like Egypt, where over 400,000 little mom-and-pop stores sell 90% of the country’s groceries.
“We saw that technology could play a huge part in streamlining this supply chain so that we can have the correct amount of products in the right place at the right time,” said El-Megharbel, who left Careem in 2018 to create MaxAB.
He refers to MaxAB as the Amazon of Middle Eastern retail. There’s a minor resemblance. Finding third-party e-commerce delivery providers to collaborate within emerging nations can be difficult. Those that are available are either costly or ineffective. The firm has its own infrastructure for this reason.
The company does not construct warehouses from the ground up. Instead, it purchases them all together and renovates them to meet its requirements. Following that, MaxAB uses internal technology to better control inventory flow into, out of, and inside the warehouse.
According to El-Megharbel, it was previously focused on providing a single sort of supply chain in a single city. That was before and after it raised $6.2 million in venture funding and added 9,000 retailers to its app. MaxAB, on the other hand, consolidates both infrastructure and technology into a multi-supply chain and multi-city firm with this latest round.
The new development comes on the heels of the company’s rapid expansion over the last two years, which has seen it handle over 55,000 merchants and provide over 2,000 unique products. The company’s workforce has increased by more than 5 times to 1,600 workers, and it is eager to expand further.
Services provided by MaxAB
When it comes to embedded finance solutions, it intends to provide financial services to its merchants. First and foremost, MaxAB can forecast merchant financial health based on the company’s merchant information. It will then work with banks and non-banking partners to provide credit and capital financing to these merchants.
The epidemic has increased technology adoption and improved the company’s unit economics dramatically. MaxAB has used its position as a market leader to consolidate its position and scale sustainably in the face of competition.
“In the Middle East, there is competition. The majority of them are marketplace models, but they do not control their supply chains in the traditional sense. And we own the end-to-end cycle, which makes our approach even more unique. It’s difficult, but we feel it’s what this sector, the B2B e-commerce area for food and grocery, requires,” the CEO stated.
Does the company see any possibility to expand southward into Sub-Saharan Africa, where it might face competition from companies like Sokowatch? El-Megharbel said, “Not in the near future.” “I estimate that the Middle East and North Africa market is worth over $200 billion each year. So, before we move to Sub-Saharan Africa, we have a long way to go.”