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Google’s new feature makes it easier to shop from search results

By Sarah Perez

Following the big revamp of Google Shopping last fall, Google today is updating the shopping experience on Google Search, on mobile. Now, when you do a web search for clothing and accessories, you won’t just get a set of links to different products and stores. Instead, Google will present a new section where it features the most popular products from stores around the web, which you can filter and browse.

For example, you could search for things like “running shoes” or “women’s leather belt” or “wide-leg pants,” Google explains, then be presented with a selection of items in a new, visual guide. You can then further narrow down what you’re looking for by style, department or size type, and view images. Underneath each item, Google will also display how many stores carry that product and the lowest price. (e.g. “$199+”)

This change will help in particular when you’re trying to find all the stores that carry one particular item — something that hasn’t been easy to do in the past.

And as you view the item in question, you can scroll down to read aggregated customer reviews. When you’re ready to buy, you’ll just click on the link to the store you want to shop.

The feature is powered by Google’s search index, which has organized products from over a million online stores and is regularly refreshed. The new shopping feature isn’t a paid advertisement for retailers either, Google notes. Participating retailers can include their eligible products within this section for free.

The changes are part of a large focus on how the shopping experience can be improved for online retailers as Google revamps to become the go-to platform for finding everything that’s not on Amazon. On that front, Google this week acquired a startup, Pointy, for $163 million to help physical retailers track their in-store inventory.

The company also recently updated the Google Shopping homepage to become a personalized destination based on your habits and purchases, with additions like a price tracker and new ways to shop from both local and online retailers. But many online searchers’ first stop when looking for clothing and accessories isn’t the Google Shopping destination — it’s a simple Google Search. That’s where the new features come in.

Google says the updated experience will begin rolling out starting today and through this week, on mobile devices only.

2019 Africa Roundup: Jumia IPOs, China goes digital, Nigeria becomes fintech capital

By Jake Bright

2019 brought more global attention to Africa’s tech scene than perhaps any previous year.

A high profile IPO, visits by both Jacks (Ma and Dorsey), and big Chinese startup investment energized that.

The last 12 months served as a grande finale to 10 years that saw triple digit increases in startup formation and VC on the continent.

Here’s an overview of the 2019 market events that captured attention and capped off a decade of rapid growth in African tech.

IPOs

The story of the year is the April IPO on the NYSE of Pan-African e-commerce company Jumia. This was the first listing of a VC backed tech company operating in Africa on a major global exchange —  which brought its own unpredictability.

Founded in 2012, Jumia pioneered much of its infrastructure to sell goods to consumers online in Africa.

With Nigeria as its base market, the Rocket Internet backed company created accompanying delivery and payments services and went on to expand online verticals into 14 Africa countries (though it recently exited a few). Jumia now sells everything from mobile-phones to diapers and offers online services such as food-delivery and classifieds.

Seven years after its operational launch, Jumia’s stock debut kicked off with fanfare in 2019, only to be followed by volatility.

The online retailer gained investor confidence out of the gate, more than doubling its $14.95 opening share price post IPO.

That lasted until May, when Jumia’s stock came under attack from short-seller Andrew Left,  whose firm Citron Research issued a report accusing the company of fraud. The American activist investor’s case was bolstered, in part, by a debate that played out across Africa’s tech ecosystem on Jumia’s legitimacy as an African startup, given its (primarily) European senior management.

The entire affair was further complicated by Jumia’s second quarter earnings call when the company disclosed a fraud perpetrated by some of its employees and sales agents. Jumia’s CEO Sacha Poignonnec emphasized the matter was closed, financially marginal and not the same as Andrew Left’s short-sell claims.

Whatever the balance, Jumia’s 2019 ups and downs cast a cloud over its stock with investors. Since the company’s third-quarter earnings-call, Jumia’s NYSE share-price has lingered at around $6 — less than half of its original $14.95 opening, and roughly 80% lower than its high.

Even with Jumia’s post-IPO rocky road, the continent’s leading e-commerce company still has heap of capital and is on pace to generate over $100 million in revenues in 2019 (albeit with big losses).

The company plans reduce costs by generating more revenue from higher-margin internet services, such as payments and classifieds.

There’s a fairly simple equation for Jumia to rebuild shareholder confidence in 2020: avoid scandals, increase revenues over losses. And now that the company’s publicly traded — with financial reporting requirements — there’ll be four earnings calls a year to evaluate Jumia’s progress.

Jumia may not be the continent’s standout IPO for much longer. Events in 2019 point to Interswitch becoming the second African digital company to list on a global exchange in 2020.  The Nigerian fintech firm confirmed to TechCrunch in November it had reached a billion-dollar unicorn valuation, after a (reported) $200 million investment by Visa.

Founded in 2002 by Mitchell Elegbe, Interswitch created much of the initial infrastructure to digitize Nigeria’s (then) predominantly cash-based economy. Interswitch has been teasing a public listing since 2016, but delayed it for various reasons. With the company’s billion-dollar valuation in 2019, that pause is likely to end.

“An [Interswitch] IPO is still very much in the cards; likely sometime in the first half of 2020,” a source with knowledge of the situation told TechCrunch .

China-Africa goes digital

2019 was the year when Chinese actors pivoted to African tech. China is known for its strategic relationship with Africa based (largely) on trade and infrastructure. Over the last 10 years, the country has been less engaged in the continent’s digital-scene.

china africa techThat was until a torrent of investment and partnerships this past year.

July saw Chinese-owned Opera raise $50 million in venture spending to support its growing West African digital commercial network, which includes browser, payments and ride-hail services.

In August, San Francisco and Lagos-based fintech startup Flutterwave partnered with Chinese e-commerce company Alibaba’s Alipay to offer digital payments between Africa and China.

In September, China’s Transsion  — the largest smartphone seller in Africa — listed in an IPO on Shanghai’s new STAR Market. The company raised ≈ $394 million, some of which it is directing toward venture funding and operational expansion in Africa.

The last quarter of 2019 brought a November surprise from China in African tech. Over 15 Chinese investors placed over $240 million in three rounds. Transsion backed consumer payments startup PalmPay raised a $40 million seed, stating its goal to become “Africa’s largest financial services platform.”

Chinese investors also backed Opera-owned OPay’s $120 million raise and East-African trucking logistics company Lori Systems’ (reported) $30 million Series B.

In the new year, TechCrunch will continue to cover the business arc of this surge in Chinese tech investment in Africa. There’ll surely be a number of fresh macro news-points to develop, given the debate (and critique) of China’s engagement with Africa.

Nigeria and fintech

On debate, the case could be made that 2019 was the year when Nigeria become Africa’s unofficial capital for fintech investment and digital finance startups.

Kenya has held this title hereto, with the local success and global acclaim of its M-Pesa mobile-money product. But more founders and VCs are opting for Nigeria as the epicenter for digital finance growth on the continent.Nigeria naira

A rough tally of 2019 TechCrunch coverage — including previously mentioned rounds — pegs fintech related investment in the West African country at around $400 million over the last 12 months. That’s equivalent to roughly one-third of all startup VC raised for the entire continent in 2018, according to Partech stats.

From OPay to PalmPay to Visa — startups, big finance companies and investors are making Nigeria home-base for their digital finance operations and Africa expansion strategies.

The founder of early-stage payment startup ChipperCash, Ham Serunjogi, explained the imperative to operating there. “Nigeria is the largest economy and most populous country in Africa. Its fintech industry is one of the most advanced in Africa, up there with Kenya  and South Africa,” he told TechCrunch in May.

When all the 2019 VC numbers are counted, it will be worth matching up fintech stats for Nigeria to Kenya to see how the countries compared.

Acquisitions

Tech acquisitions continue to be somewhat rare in Africa, but there were several to note in 2019. Two of the continent’s powerhouse tech incubators joined forces in September, when Nigerian innovation center and seed-fund CcHub acquired Nairobi based iHub, for an undisclosed amount.

CChub ihub Acquisition

The acquisition brought together Africa’s most powerful tech hubs by membership networks, volume of programs, startups incubated and global visibility. It also elevated the standing of CcHub’s Bosun Tijani across Africa’s tech ecosystem, as the CEO of the new joint-entity, which also has a VC arm.

CcHub CEO Bosun Tijani1

CcHub/iHub CEO Bosun Tijani

In other acquisition activity, French television company Canal+ acquired the ROK film studio from Nigerian VOD company IROKOtv, for an undisclosed amount. The deal put ROK founder and producer Mary Njoku in charge of a new organization with larger scope and resources.

Many outside Africa aren’t aware that Nigeria’s Nollywood is the Hollywood of the continent and one of the largest film industries in the world (by production volume). Canal+ told TechCrunch it looks to bring Mary and the Nollywood production ethos to produce content in French speaking African countries.

Other notable 2019 African tech takeovers included Kenyan internet company BRCK’s acquisition of ISP Surf, Nigerian digital-lending startup OneFi’s Amplify buy and Merck KGaa’s purchase of Kenya-based online healthtech company ConnectMed.

Moto ride-hail mania

In 2019, Africa’s motorcycle ride-hail market — worth an estimated $4 billion — saw a flurry of investment and expansion by startups looking to scale on-demand taxi services. Uber and Bolt got into the motorcycle taxi business in Africa in 2018.

Ampersand Africa e motorcycle

Ampersand in Rwanda

A number of local and foreign startups have continued to grow in key countries, such as Nigeria, Uganda and Kenya.

A battle for funding and market-share emerged in Nigeria in 2019, between key moto ride-hail startups Max.ng, Gokada, and Opera owned ORide.

The on-demand motorcycle market in Africa has attracted foreign investment and moved toward EV development. In May, MAX.ng raised a $7 million Series A round with participation from Yamaha and is using a portion to pilot renewable energy powered e-motorcycles in Africa.

In August, the government of Rwanda announced a national policy to phase out gas-motorcycle taxis altogether in favor of e-motos, in partnership with early-stage EV startup Ampersand.

New funds

The past year saw several new funding initiatives for Africa’s startups. Senegalese VC investor Marieme Diop spearheaded Dakar Network Angels, a seed-fund for startups in French-speaking Africa — or 24 of the continent’s 54 countries.

Africinvest teamed up with Cathay Innovation to announce the Cathay Africinvest Innovation Fund, a $100+ million capital pool aimed at Series A to C-stage startup investments in fintech, logistics, AI, agtech and edutech.

Accion Venture Lab launched a $24 million fintech fund open to African startups.

And Naspers offered more details on who can pitch to its 1.4 billion rand (≈$100 million) Naspers Foundry fund, which made its first investment in online cleaning services company SweepSouth.

Closed up shop

Like any tech ecosystem, not every startup in Africa killed it or even continued to tread water in 2019. Two e-commerce companies — DealDey in Nigeria and Afrimarket in Ivory Coast — closed up digital shop.

Southern Africa’s Econet Media shut down its Kwese TV digital entertainment business in August.

And South Africa based, Pan-African focused cryptocurrency payment startup Wala ceased operations in June. Founder Tricia Martinez named the continent’s poor infrastructure as one of the culprits to shutting down. A possible signal to the startup’s demise could have been its 2017 ICO, where Wala netted only 4% of its $30 million token-offering.

Africa’s startups go global

2019 saw more startups expand products and business models developed in Africa to new markets abroad. In March, Flexclub — a South African venture that matches investors and drivers to cars for ride-hailing services — announced its expansion to Mexico in a partnership with Uber.

In May, ExtraCrunch profiled three African founded fintech startups — Flutterwave, Migo and ChipperCash — developing their business models strategically in Africa toward plans to expand globally.

By December, Migo (formerly branded Mines) had announced its expansion to Brazil on a $20 million Series B raise.

2020 and beyond

As we look to what could come in the new year and decade for African tech, it’s telling to look back. Ten years ago, there were a lot of “if” questions on whether the continent’s ecosystem could produce certain events: billion dollar startup valuations, IPOs on major exchanges, global expansion, investment from the world’s top VCs.

All those questionable events of the past have become reality in African tech, even if some of them are still in low abundance.

There’s no crystal ball for any innovation ecosystem — not the least Africa’s — but there are several things I’ll be on the lookout for in 2020 and beyond.

Two In the near term, start with what Twitter/Square CEO Jack Dorsey may do around Bitcoin and cryptocurrency on his return to Africa (lookout for an upcoming TechCrunch feature on this).

I’ll also follow the next-phase of e-commerce in Africa, which could pit Jumia more competitively against DHL’s Africa eShop, Opera and China’s Alibaba (which hasn’t yet entered Africa in full).

On a longer-term basis, a development to follow is how the continent’s first wave of millionaire and billionaire tech-founders could disrupt 21st century dynamics in Africa around politics, power, and philanthropy —  hopefully for the better.

More notable 2019 Africa-related coverage @TechCrunch

Pan-African e-tailer Jumia grows 3Q revenue, e-payments and losses

By Jake Bright

Pan-African e-commerce startup Jumia released its third-quarter financial results today.

The numbers and presentation reflected some of the same past trends, with a dash of new, and nary a mention of a declining share price.

The results

Jumia — with online goods and service verticals in 14 countries — posted third-quarter revenue growth of 19% (€40 million) and increased its active customer base 56% to 5.5 million from 3.5 million over the same period a year ago.

Jumia’s Gross Merchandise Value (GMV) — the total amount of goods sold over the period — grew by 39% to €275 million. The online retailer nearly doubled its orders from 3.6 million in Q3 2018 to 7 million in Q3 2019.

Jumia also saw growth in its JumiaPay digital finance product, with total payment volume growing 95% to €32 million in Q3 2019 from €16.4 million in Q3 2018.

This is significant, as the company has committed to generate more revenues from digital payment products and offer JumiaPay as a standalone service across Africa.

The overall pattern of growing revenues and customers YoY has been consistent for Jumia.

But so too have the company’s losses, which widened 34% in 3Q 2019 to €54.6 million, compared to €40.6 million. Negative EBITDA increased 26% to €45.4 million from €35.8 over the same period in 2018.

Jumia pegged a large part of the spike in losses to an increase in fulfillment expenses due to more cross-border goods transactions (with higher shipping costs) on its platform in 3Q 2019.

What’s new

Jumia introduced some new methodologies and measures for its results. “We believe the most relevant monetization metrics for us are market-based revenue and gross profit,” Jumia Group CFO Antoine Maillet-Mezeray explained on the call.

“We don’t see revenue as a meaningful metric to assess the monetization of our business as it is impacted by shifts in the revenue mix between first party and marketplace,” he said.

If and when Jumia does get into the black, I suspect revenue will shift back as key.

On its path to profitability, Jumia CEO Sacha Poignonnec reaffirmed the company’s commitment to generate more revenue from higher margin (straight through) products, such as JumiaPay and Jumia’s classified business, over cost-intensive (and logistically complicated) online goods sales.

“We are focused on driving the adoption and penetration of Jumia pay within our own ecosystem,” he said — meaning across Jumia’s existing buyer-seller universe.

Since its founding in 2012, the company has been forced to adapt to slower digital payments integration in its core Nigeria and allow cash-on-delivery payments, which are costly and more problematic than digital processing.

Poignonnec highlighted Jumia’s commitment to build a financial services marketplace (and revenues) from consumers and partners using JumiaPay and JumiaLending for products such as loans, third-party credit-scoring and insurance, he explained. This has led to Jumia moving into working-capital services for vendors on its platform.

On the movement of online goods, Jumia highlighted the expansion of its JumiaMall service, which offers brands — such as L’Oreal, Samsung and Unliver — more tailored selling options on its website around shipping, product positioning and consumer data analytics.

Jumia also shared info on product mix and diversification, which showed strong upward trends in digital services, the sale of consumer electronics and beauty products.

Share price

Surprisingly absent from Jumia’s earnings call and the subsequent Q&A was any discussion of the company’s share price.

Today’s reporting was slightly more anticipated, given Jumia has faced a short-seller assault, sales scandal and significant market-cap drop since its April IPO on the NYSE.

The online retailer gained investor confidence out of the gate, more than doubling its $14.50 opening share price after the IPO.

That lasted until May, when Jumia’s stock came under attack from short-seller Andrew Left, whose firm Citron Research issued a report accusing the company of fraud. That prompted several securities-related lawsuits against Jumia.

The company’s share price plummeted 43% — from $49 to $26 — the week Left released his short-sell claims.

Then on its second-quarter earnings call in August, Jumia offered greater detail on the fraud perpetrated by some employees and agents of its JForce sales program. 

The company declared the matter closed, but Jumia’s stock price plummeted more after the August earnings call (and sales-fraud disclosure), and has lingered in the $6 range for weeks.

That’s 50% below the company’s IPO opening in April and 80% below its high.

Jumia can offer new metrics to evaluate its performance, but the simplest measure — the ability to generate revenues in excess of costs to turn a profit — will still apply.

The sooner Jumia can go in that direction the faster it can revive its share price and investor confidence.

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